State Bank of India is reintroducing penalties for low balance and hiking its transaction fees from April 1. This is the first time in five years the bank is levying a penalty for accounts dipping below the monthly minimum balance.
In 2012, SBI had stopped the practice. The public-sector bank, with a presence across continents, has merged with five associate banks — State Bank of Mysore, State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Hyderabad and State Bank of Patiala. The consolidated entity formally comes into being on April 1.
The government-owned bank has also decided to revise charges on cash handling.
SBI will charge Rs 50 for every additional transaction after three cash deposits at its branches. The maximum deposit allowed at a non-home branch is Rs 2 lakh a day.
Thereafter, the branch manager is vested with the power to accept more cash. The bank has also hiked the fee for cash withdrawal, after three such transactions, to Rs 150 from the earlier Rs 100.
Account holders are allowed to use SBI ATMs for free five times a month in Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad.
In the six metros, they can use other bank ATMs three times a month. Once this limit is exhausted, they will be charged Rs 20 for every financial transaction and Rs 8 for every non-financial transaction.
As far as SBI ATMs are concerned, customers are charged Rs 10 for every additional financial transaction and Rs 5 for every additional non-financial transaction.
Fine plus service tax
According to a circular on the bank’s website, if an account holder in a rural area does not have a minimum balance of Rs 500, the penalty is Rs 20 plus tax a month. Service tax is added to the all penalties.
The penalty goes up if the shortfall is higher. If the customer has less than Rs 250 in the account, it is Rs 50 a month.
In urban areas, if the balance is less than Rs 1,500, the customer pays a penalty of Rs 40 a month. If the balance is less than Rs 750, the penalty is Rs 80 a month.
In the metros, the minimum balance is Rs 5,000. If an account holder falls short by Rs 2,500, the penalty is Rs 50. If the balance is below Rs 1,250, the penalty goes up to Rs 100 a month.