NEWS

SBI banking to be costlier for average man

State Bank of India (SBI) is said to be reviewing charges for certain accounts for non-maintenance of monthly average balance (MAB) after receiving feedback from customers.

In April this year, the country’s largest lender reintroduced charges on non-maintenance of monthly average balance (MAB) after a gap of five years.

“We have received feedback from our customers on the issue and we are reviewing them. The bank will take into account those and make an informed decision,” the banks managing director [national banking group] Rajnish Kumar told.

As per the list of revised charges of SBI, failure to maintain monthly average balance in accounts will attract penalty of up to ?100 plus GST.

In metropolitan areas, there will be a charge of ?100 plus GST, if the balance falls below 75% of the MAB of ?5,000. If the shortfall is 50% or less of the MAB, then the bank will charge ?50 plus GST.

In rural areas, the monthly average balance requirement has been kept at ?1,000. Any shortfall in maintaining minimum balance in rural areas can attract penalty in the range of Rs. 20 to Rs. 50 plus GST.

The bank in April had given notices to all those account holders who did not have monthly average balance and asked them to keep the minimum balance in May.

“When they did not maintain the monthly average balance in May then we recovered in June. We had recovered Rs. 235 crore from such account holders as penalty,” Mr. Kumar said.

He said there is huge cost in maintaining the savings accounts and banks should be allowed to recover some costs. The charges which SBI levy for non-maintenance of minimum balance is very competitive as compared to other lenders.

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