SBI reduced minimum balance limit for savings account, effective on April 1

Remigio Civitarese
Marzo 13, 2018

SBI cuts down charges on minimum balance maintenance.

The State Bank of India (SBI) on Tuesday announced a decrease in the penalty it charges for non-maintenance of average minimum balance in savings bank account.

The charges for non-maintenance of AMB for customers in metro and urban centers have been reduced from a maximum of Rs. 50 to Rs.15 per month, excluding Goods and Services Tax (GST).

SBI has also slashed charges for not-maintenance of Rs2,000 as ABM in bank accounts in semi-urban areas to Rs7.50-12 and Rs1,000 in accounts in rural area to Rs5-10.

‎"We have reduced these charges taking into account the feedback and sentiments of our customers".

At present, you have to maintain the minimum balance of Rs. 3000 in metro cities in your account.

According to the last notification issued by the bank, account holder in urban, semi-urban and rural places had to maintain a minimum balance of Rs 3000, Rs 2000 and Rs 1000 respectively. The revised charges will be effective from April 1.

The bank believes that the above revision in AMB will benefit 25 crore customers.

Public sector banks (PSBs) are reeling under bad loans.

Interestingly, while SBI provided relief to customers in regards to AMB in savings account, it also encouraged customers for shifting towards Bank Saving Bank Deposit (BSBD) account.

The bank has a deposit franchise having 41 crores savings bank accounts out of which 16 crore accounts under Pradhan Mantri Jan Dhan Yojana/BSBD and of pensioner/minors/social security benefit holders were already exempted.

The move will benefit 25 crore customers of the bank. While ICICI charges Rs 100 plus 5 percent of the shortfall in required MAB, HDFC Bank charges up to Rs 600 for not maintaining the balance. Currently, the charges are in the range of Rs20-40.

"When an SBI customer uses a debit card at some other bank ATM, then SBI has to pay Rs 17 to the bank". For instance, HDFC Bank Ltd has an AMB requirement of Rs10,000 for regular savings accounts in metro and urban centres, and Rs5,000 in semi-urban branches.

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