We all know that we must maintain some specified minimum balance in our savings account. Otherwise, banks used to penalize us. But do you know after few months they must not levy any penalty!!!. Very few know these small banking rules.
It is clearly mentioned in RBI guidelines also that if savings account holder not maintain the minimum balance then there must be some penalty. Banks need to intimate customers about the rules and amount of penalty to be levied in a transparent manner. However, if the account holder continues the account with non- maintaining the minimum balance then RBI specified some rules, which are very much customer friendly and usually most banks not following. So let us see what those measures are.
1) Banks must inform you about the penalty levied on non-maintenance of minimum balance-
In case account holder fails to maintain the minimum balance then banks should inform the customers through SMS/Email/Letter. So even if you aware about penalty on non-maintaining of minimum balance, banks must inform you about the penalty levied to you.
2) Banks must limit the services available to such savings account-
In case customer not maintained the minimum balance, then banks must not continue to charge. Instead, they must reduce the services available to that of Basic Savings Bank Deposit Accounts. Once the balance restored, then they convert the account to its original account. However, how many banks follow these rules?
For your information, Basic Savings Bank Deposit Accounts are those savings accounts, which meant for basic banking transactions and you no need to maintain minimum balance. Along with that, usually there will be some restriction on services.
3) The penalty must be in proportion to the shortfall-
Usually banks penalize you to the full amount of penalty for not maintaining the minimum balance. However, let us say you have Rs.4, 000 in your account and banks specified limit of maintaining minimum balance is Rs.10, 000. In addition, bank rule claims that not maintaining a minimum balance will cost you Rs.1, 000. In that case, banks cannot levy you full amount. Instead, it should be proportionate. To say in simple words, it must be equal proportional of actual shortfall. In the above example, it is Rs.600 but not Rs.1, 000 as you have balance of Rs.4, 000 in your savings account.
Whether all banks follow this rule? Check out yourself 🙂
4) Account balance must not turn into negative-
If you continuously not maintained the minimum balance required by banks then they must not charge continuously so that your balance turns into negative. Instead, they must take the above two steps to bring it to always in positive balance.
5) Banks have to wait for a month before levying penalty-
If an account holder fails to maintain the minimum balance even after repeated intimation to him/her, then banks must levy charge only after a month of waiting period. So they cannot charge you if your balance falls short of minimum balance for a single day.
Hope above information will be helpful in your banking.
Image courtesy of [Stuart Miles] at FreeDigitalPhotos.net