The State Bank of India’s (SBI) decision to levy charges for bank transactions and impose penalty for non-maintenance of minimum balance in all savings accounts has drawn strong criticism from both the banking sector as well as customers.
The All India Bank Employees Association (AIBEA) and the All India Bank Officers Association (AIBOA) organised a protest earlier this week against the SBI’s “arbitrary” decision to impose service charges on its customers as they feel it could exclude the poor people from the banking system.
S. Nagarajan, general secretary of the AIBOA, told The Sunday Guardian: “Imposing incidental charges on customers is arbitrary and public sector banks cannot specify the minimum balances to their customers.”
In the protest held earlier this week by both the organisations across the country, members and employees demonstrated outside SBI branches. They also put up posters at the SBI branches highlighting their demands to withdraw such charges levied on customers. Some members also protested by wearing badges and carrying posters inside the SBI branches across the country.
J.P. Sharma, president of AIBEA’s Delhi Chapter, told this newspaper: “Such a decision is against the principle of inclusive banking in a poor country like India. This is an arbitrary move by the bank to charge customers for every transaction.”
The SBI has started charging its customers from 1 April this year, including penalty for non-maintenance of Monthly Average Balance of Rs 5,000 for metro cities, and Rs 3,000, Rs 2,000 and Rs 1,000 for urban, semi-urban and rural areas, respectively. Failure to maintain Monthly Average Balance in accounts will attract penalty of up to Rs 100 plus service tax. For rural areas, the penalty ranges from Rs 20-50 plus service tax.
Charges for depositing and withdrawing money in savings bank accounts have also been fixed. Only three free deposits would be allowed monthly, and three free withdrawals.