Union Government have asked State Bank of India (SBI) and other Public Sector banks to reconsider imposing penalty on non- maintenance of minimum balance and cash withdrawal charges from April 1.
According to a published report in UNI, sources in the Finance Ministry, Government has taken the decision of SBI and some other banks seriously as it is going to adversely affect masses. Sources said that during the election period in Uttar Pradesh and Manipur, the decision of the banks, may give a negative perception about the functioning of the central government.
However, Congress too reacted sharply on the decision to impose penalty on minimum balance and transaction charges after 3 to 4 transaction through banks or ATMs.
Many associations and bodies have shown their unhappiness over the decision of the banks. It may be recalled that State Bank of India has decided to increase manifold the minimum balance required for maintaining savings account from April 1, hitting 31 crore depositors including pensioners and students.
The monthly average balance (MAB) requirement has been increased to as high as Rs 5,000 for branches in six metros. Savings bank account holders of SBI and its five associates (merging with it on April 1) will have to maintain the monthly balance or else they will invite a penalty ranging from Rs 20 (rural branches) to Rs 100 in (metro cities).
As of now, monthly average balance (MAB) for a savings bank account is Rs 500 without facility of cheque book and Rs 1,000 with cheque book across the country.
According to decision, the bank will start charging Rs 50 after the first three cash deposits of the month. This limit is prescribed for saving bank accounts. For current account holders the cash transaction charges can be as high as Rs 20,000.