Mumbai: Days after reports emerged about the exorbitant fee it collected, State Bank of India said on Friday that it was considering revising minimum balance amount and penalty charges for non-maintenance of monthly average balances (MAB) in their savings accounts.
Last week, Parliament was informed that the country’s largest lender pocketed a neat Rs 1,771 crore from customers via penalties, higher than the bank’s registered profit of around Rs 1,500 crore in Q2, FY18.
“A review of the monthly average balance is something we have been looking at continuously since we had brought it back in April and we have already brought it down in October a bit. Now we are in the process of reviewing it again,” said P K Gupta, managing director, retail and digital banking, SBI.
Speaking to media on the sidelines of an event here, he added that the bank was doing a comprehensive review of the MAB and penalty for non-maintenance, based on the feedback and will soon announce it.
SBI, which counts over 40.5 crore savings account holders, reintroduced MAB charges from April 2017 after a gap of five years. Currently, the bank has a MAB of Rs 3,000 (down from Rs 5,000) for the metro and urban accounts and the non-maintenance penalty varies Rs 30-50 plus taxes (down from Rs 50-100). For semi-urban and rural branches, the amount is fixed at Rs 2,000 and Rs 1,000, respectively, and the penalty for non-maintenance is in the range of Rs 20-40 plus taxes.
The bank recently said that on average balance of Rs 3,000 in the metros, it earned only Rs 6 a month whereas for a minimum balance of Rs 1,000 in rural, it earned Rs 2 per month, which is meagre compared to the services offered and the corresponding costs incurred by the bank (free cheque books, eight free ATM transactions, free branch transactions).
According to SBI, accounts like the Prime Minister’s Jan Dhan Yojana, small accounts and basic savings bank deposit accounts, pensioners, minors and all social beneficiary accounts are exempt from MAB requirement and no charges ever have been recovered. (Reuters)