Several banks have recently started levying charges on savings account customers if the number of withdrawals during a period of six months, including those from automated teller machines, exceeds the stipulation set by the banks.
This has come as a shock to many customers, who found that their bank has debited a few hundred rupees as the charge from their accounts.
Many of them complained that the amount was debited without prior notice about the charge.
S. Rajadurai, a Velachery resident and an account-holder in a nationalised bank for over three decades, said “Last month, the bank debited Rs.534 from my account for exceeding 50 withdrawals that is permitted for a period of six months. The bank charged at the rate of Rs.6 per transaction beyond the limit, which is exorbitant.”
Customers complained that though it was part of the banks' norms, many of the institutions began implementing the rules only recently. G.Sunil, a resident of Kilpauk, said “I frequently use ATMs. On the one hand, banks insist on use of ATMs to reduce workload on branches. On the other, they also levy such charges.”
Officials of various banks, including private sector, said that the regulations were not new. An official of Federal Bank said the number of withdrawals and the charges varied according to each bank. It may seem a recent trend as the banks are able to monitor the accounts better as a result of computerisation.
Some banks do not take into account the cash transactions at ATMs for levying the charges. A senior official of Indian Bank said customers who withdraw more than 50 times in six months have to pay the charges. Measures are afoot to revise the norms, including the type of debits, to be included under the levy.
State Bank of India officials said the number of debits — by way of cash and cheque withdrawals — permitted has been reduced from 50 to 30 for six months. This is to encourage people to use other options such as ATMs, mobile and internet banking.
A few banks, including United Bank of India, decide on the levy based on the number of debit transactions in the savings bank account pass book.
On the customer reaction, an official of a bank said that not much has been done to create awareness about the charge as only a few customers exceeded the stipulated number of transactions.
Reserve Bank of India officials said the banks followed the guidelines of Indian Banks Association, a self-regulatory body. M. K. Singh, General Manager, Department of Banking Supervision, RBI, said the amount chargeable for debiting beyond the limit and the number of transactions was not mentioned in the guidelines. Customers could complain to the banks if the charges were arbitrary.
He also highlighted the recent RBI directive of payment of interest on savings account on a daily basis. Up to March, the interest was calculated on the minimum balance in the account between 10th and the last day of the month. Banks have been advised to implement the payment of interest on the balance maintained daily from this month.