PSBs collect Rs 5,000 crore from customers in FY18 as minimum balance penalty

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500_rupeesAs many as 21 Public Sector Banks and three leading private sector lenders have collected a sum of Rs 5,000 crores from consumers for non-maintenance of minimum balance in their accounts during 2017-18.

India’s largest public lender State Bank of India (SBI) reintroduced the rule of maintaining the minimum balance on deposits going below monthly average balance basis from April 2017. The bank that was suffering from a net loss of Rs 6,547 crore, collected nearly half the amount raised by the 24 banks put together (Rs 4,989.55 crore).

However, for the additional income of Rs 2,433.87 crore under this head, SBI’s losses would have escalated further.

Followed by SBI, private lender HDFC Bank collected the second highest penalty for not maintaining the minimum balance. It collected Rs 590.84 crore, which is lower than its previous collection at Rs 619.39 crore in 2016-17, revealed the official data.

As per the Reserve Bank of India (RBI) guidelines, banks are allowed to levy service/miscellaneous charges.

Account holders under the Basic Savings Bank Deposit (BSBD) scheme as well as Pradhan Mantri Jan Dhan Yojna, are exempted from maintenance of minimum balance.

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