11 public banks charge Rs 2,331 cr for non-maintenance of minimum balance

For the recovery of this charge from account holders, public sector banks have formulated slab structures based on different geographies and segments

Account holders of 11 public sector banks have been cumulatively charged Rs 2,331 crore for their failure to maintain a minimum balance in savings banks in FY24. This is a rise of 25.63 per cent from Rs 1,855.43 crore in FY23.

According to an Indian Express report quoting Ministry of Finance data, these 11 banks have collected Rs 5,614 crore from account holders for not maintaining the minimum balance in the last three years.

These 11 banks are -- Bank of Baroda, Bank of India, Bank of Maharashtra, Canara Bank, Central Bank of India, Indian Bank, Indian Overseas Bank, Punjab & Sind Bank, Punjab National Bank, UCO Bank, and Union Bank of India.

 

Among these, Punjab National Bank (PNB) collected the maximum amount of Rs 633.4 crore from its customers, followed by Bank of Baroda (Rs 386.51 crore) and Indian Bank (Rs 369.16 crore), the finance ministry data added. For the recovery of these charges, banks have formulated slab structures based on different geographies and segments.

Minimum bank balance: RBI norms

According to RBI norms, banks are required to inform the customers regarding the requirement of minimum balance at the time of opening the account. Any subsequent changes should also be intimated to the account holders.

Additionally, RBI norms mandate banks to ensure that savings accounts do not touch a negative balance solely on account of the levy of charges for non-maintenance of minimum balance. Besides, the banks are also required to notify the customer about the penal charges which will be applicable if the account balance is not replenished within one month from the date of notice.

It is worth mentioning that the country's largest public sector bank -- State Bank of India -- stopped charging a penalty for not maintaining a minimum balance since FY20.