CHENNAI: State Bank of India (SBI), India’s largest lender, will resume charging customers who don’t maintain monthly account average balance (MAB) in their savings bank accounts from April 1. These charges will be based on the difference between the minimum balance required and the shortfall.
The minimum monthly balance for savings bank account holders in metropolitan areas is Rs 5,000. Similarly, in urban areas, SBI customers will need to maintain a monthly average balance of Rs 3000. In semi-urban areas, the amount is Rs 2,000, while for rural areas, the monthly average is Rs 1,000.
For metropolitan areas, if the shortfall is greater than 75 per cent, the charges would be Rs 100-plus service tax. Similarly, in urban areas, if the shortfall in MAB is less than 50 per cent, then a charge of Rs 40 plus service tax will be levied.
If the shortfall is between 50 and 75 per cent, then the account holder will have to pay Rs 60 plus service tax, and if the shortfall in the average balance is more than 75 per cent, a charge of Rs 80 plus service tax will be levied.
SBI had relaxed the minimum balance criteria for savings bank accounts a few years ago in a bid to lure new customers. Now that the bank is set to merge its five associate banks with itself, thereby becoming a banking behemoth with close to 50 crore customers, the latest move could fetch the bank handsome revenue even if only a portion of the customers default in maintaining MAB.
Meanwhile, SBI has reduced interest rates on term deposits maturing between 180 days and one year, and between 456 days and three years with effect from March 1.
The country’s largest bank by assets will now pay 6.5 per cent on deposits with maturities between 180 days and less than one year, and 6.75 per cent on those maturing between 456 days and less than three years.