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  • Category: Miscellaneous

    Is maintaining minimum balance in savings bank account justified?

    The banks are insisting on maintaining a monthly minimum average balance in savings bank accounts. The Axis Bank insists on Rs10000/ minimum in savings bank account.The State Bank of India reintroduced this rule on 01-04-2017. It made a profit of Rs 1771/ crores by penalising the savings bank accounts which fell short of the minimum average balance from 01-04-2017 to 30-11-2017. This is more than the Rs 1581.55 crores it earned as a profit during the quarter ending September. The banks earn their profits by lending money deposited in the banks. On one side the non-performing assets are increasing. is it justified to levy penalty on the customers whose money is used by the banks to earn profits?
  • #622053
    Banks have been exploring various ways to penalise the regular depositors and goes scott free with those who were the will-full defaulters. I am totally against the banks insisting to have minimum hefty balance in the savings account. After all they are giving pittance interest and for that we have to maintain big balance. Savings money of account holders are the pocket money for the bankers and they use them at their will. On the one hand our PM Modi has induced people to open Jan Dhan account for zero amount and now the banks are asking to maintain amount. Our PM only should talk to bankers to stop this loot.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #622061
    Stipulation for minimum balance was there in early times also. But that just pittance in the old generation banks. Even that they were not recovering strictly and were even condoning in many cases.
    The strict penalisation and higher amount of penal charges was brought in by the new generation banks. However as the clients were mostly high networth and the banks were giving better service in terms of mechanisation and computerisation, no one was complaining about that.

    When all banks including the old generation banks were compelled to implement full computerisation and automation and give all latest facilities, the old generation banks had to find revenue for these . So they were asked to charge for the services.

    The scene changed when banks were asked to pay savings bank interest as per balance on each day closing. Earlier they weer to give SB interest only on the minimum balance available. That served as a cushion for them. As they had to pay interest for the last rupee kept, they also wanted to charge for not keeping minimum balance.

    However as the clientele is more middle class in these banks, they felt it as disturbing when the banks reduced the interest rate on deposits. In relation to the interest on deposits for the same amount, the penal charges are exorbitant.Moreover instead of the simple clause of keeping a certain amount always as minimum, the complicated terminology also confuses people.

    I am also a victim of arbitrary charging of banks.
    (Refer this thread)

  • #622063
    I'm not really aware of the banking system but minimum balance thing is justified according to me because banks can withdraw some amount from the accounts then and keep the transactions oiled up. But I would wish that the minimum amount should be thousand or five hundred.
    Levying penalty is the only way of ensuring that the account holders do what they're intended to.

    The stronger a light shines the darker are the shadows around it.

  • #622066
    The rule of Bank to maintain big amount of minimum balance in the bank savings account is absolutely unreasonable and sort of loot with bank customers as the bank does not extend special benefit to customers who are maintaining sizable amount in their savings account. That is there is no special interest is extended by bank to savings account holder upon maintaining sizable amount or more than minimum balance amount in their account. Actually, if bank does not able to extend the special interest on amount in the savings account then bank should not levy any charges upon bank balance not maintaining below minimum balance which is unreasonable amount. Being smart citizen of India, every one should oppose such kind of loot by bank and put forward request to Bank authority, RBI, and government for withdrawal of such unfair charges and rule to maintain high amount of minimum balance which should not be more than Rs. 500/1000 as per economy of Indian and facility of banks.
    Hence, it is totally not justified with respect to savings interest rate, another facility to saving account holder like insurance, loan, etc.

  • #622067
    It is not correct that banks to insist for minimum balance in the accounts. That to minimum Rs.10,000/-. People are encouraged by governemnt to open accounts in banks as zero balance accounts and asking some people to maintain minimum balances. This is like using a very big ammunition to kill a sparrow. These banks are giving huge amounts of loans to some people who are not interested in returning the money and enjoying their life in foreign countries. But the same bank officers are trying to fix the people who struggle in the life of their two times a day meal. So banks should make these banks to stand straight and help the people who really deserve help and see that these people will not be at a loss.
    always confident

  • #622653
    Unfortunately, we live in a world where the authorities are penny wise and pound foolish. They all have crores and crores of bad loans and debts that nobody questions because they would all loose their jobs. They do not have the moral courage to go after the big fish and crooks who have milked the system. Instead they find an easy target, ie the regular customers who have to earn a honest living and use the bank for his or her regular activities. Imagine if for a few days we stop using the bank and do our activities in cash, they will be soon running behind us with all sorts of offers and perks. I feel we have made to become too dependent on the banks and now face hardship for the fault of someone else.

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