Bank accounts are widely used by students, employees, business owners, and retirees to receive pensions. Each account has rules for maintaining a minimum balance.
Adhere to these rules to avoid charges that vary from bank to bank. Let’s examine the specific situation in Dent.
Over the past five years, public sector banks have collected Rs. 8,495 crores in customer penalties due to non-maintenance of minimum balance in savings accounts.
The State Bank of India (SBI), the largest public sector bank in the country, used to charge customers for not meeting the minimum balance requirement.
Still, this provision has been removed, meaning there are no charges for having a zero balance in SBI accounts. However, other banks still impose charges for non-maintenance of the minimum balance.
During the last five years, government banks such as Indian Bank, Bank of Baroda, and Canara Bank have collected significant amounts from customers due to non-maintenance of minimum balance, with Rs. 1538 crores, Rs. 1466 crores, Rs. 1251 crores, and Rs. 1158 crores, respectively.
Banks determine the minimum balance requirement based on their services and should provide accurate information to customers.
This requirement is usually assessed based on the average monthly balance, which is the average of the closing balances for each day in a month. It is calculated by adding the closing balances for each day and dividing them by the total number of days in the month.
Remember, falling below the minimum balance will incur charges, which will be deducted directly from the bank account. You want to avoid this situation, so it’s crucial to keep an eye on your balance.
Here’s a detailed summary of the minimum balance requirements and charges in leading banks so you can make informed decisions about your accounts:
- SBI will not charge minimum balance fees starting in 2020.
- HDFC savings accounts in metro and urban areas require a minimum balance of Rs.10,000 or a fixed deposit of at least Rs.1 lakh.
- The SEBI Urban account demands a minimum balance of Rs.5,000 or a fixed deposit of Rs. 50,000, with a 6% penalty or Rs.600 for non-compliance.
- ICICI Bank Savings Account mandates a minimum balance of Rs.5,000, with an additional charge of Rs.100 and a 5% deduction from the monthly average balance.
- Punjab National Bank requires a minimum balance of Rs.500 in rural areas, Rs.1000 in SEBI Urban bank accounts, and Rs. 2000 in urban and metro accounts, with charges of Rs.400, Rs.500, and Rs.600, respectively.
- At Yes Bank, a charge of up to 5% will be imposed on any shortfall from the minimum balance or excess amount.