Banks Have Been 'Thug' On The Name Of Minimum Balance
Banks Have Been 'Thug' On The Name Of Minimum Balance
Most banks are resorting to deliberate charges on accounts that have fewer balance than minimum balance in Savings accounts that violate the Reserve Bank's guidelines. There is a rule of RBI to take penalty against the amount of balances less than the minimum balance, but most banks are taking penalties more than that. Most banks are not taking reasonable penalties, not considering RBI directives.
According to a study conducted by Professor Ashish Das of IIT Mumbai's Department of Mathematics, most banks charge about 78 per cent of the shortfire amounts each year. RBI has prepared guidelines on penalties for consumers, but even after 3 years, its implementation is not being done properly.
According to the report, penalties should be imposed in the proportion of the amount of loss (shortfone) as per the guidelines of the RBI and penalties should be linked to the cost of providing savings account service.
Interestingly, compared to Public Sector Banks, Guideline is increasingly being followed in multinational banks. Because the minimum balance amount in multinational banks is very high and if the money is less than that, then the penalty amount also becomes bigger.
Das says that the banks have the freedom to decide how much should be the minimum balance the bank has. But that does not mean that banks charge as much money as possible while deciding the penalty. RBI mandates that the cost of providing services is to be fined. This means that calculating the cost of the banks savings account, calculating loan and overalls cost is not appropriate.
Read this News Report
