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January 05, 2018

SBI is going to cut Minimum Balance Requirement for Savings Accounts

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The State Bank of India (SBI) is going to change it's rules for maintaining minimum average balance in savings accounts. The bank is also going to slash the penalties for non-maintenance of MAB (Monthly Average Balance).

Two days ago, a report has emerged saying the lender profited from fines. The bank has made Rs 1,772 crore in fees by imposing penalties for nonmaintenance of minimum balance between April and November 2017. These charges were slapped on customers who failed to maintain the minimum monthly average balance in their accounts. The amount is said to be more than the bank’s July-September quarter net profit of Rs 1,581.55 crore and nearly half of the Rs 3,586 crore it earned as net profit during April to September last year.

SBI started facing wide criticism for this step. So now, the bank is going to change the requirement from monthly average balance to quarterly average balance besides slashing the minimum balance requirement to around Rs 1,000 in metros.

SBI had originally increased the minimum balance requirement to Rs 5,000 in June. However, following public backlash the bank brought down the minimum balance requirement to Rs 3,000 in metros, Rs 2,000 in semi-urban and Rs 1,000 in rural centres.

The bank is going to release a notice regarding the new changes in detail.

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