Banks to Provide Zero Balance Accounts to All

By SiliconIndia   |   Tuesday, May 8, 2012   |    3 Comments
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Bangalore: The Reserve Bank of India (RBI) has instructed all banks to provide basic savings or ‘no-frills’ accounts to all customers, as reported by Shruti Verma Khare of MyDigitalFC. RBI will shortly furnish details regarding related guidelines of such accounts.

This equates to customers not being under any obligation to have a minimum balance in their accounts. This feature shares some common traits of bank accounts but does not provide cheque-books and allows only limited ATM transactions. This feature was previously available only to under-banked and rural customers.

In its annual monetary policy, RBI quoted that , “Financial inclusion has been high on the agenda of the Reserve Bank of India. With a view to providing a fillip to this concept, banks were advised, in November 2005, to make available a basic banking no-frills account with either nil or very low minimum balance. The nomenclature of the account in this manner has tended to signify that these accounts are opened more with a view to indicating achievement of numerical targets under the financial inclusion plans. On a review, it has been decided to modify the guidelines on opening of basic banking no-frills accounts with a view to doing away with the stigma associated with the nomenclature and making basic banking facilities available in a more uniform manner across the banking system.”

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Reader's comments(3)
1: Have you seen the AD on a bus in Hyderabad - It says we provide ATM service anywhere in INDIA at all ATM free. This bank is Mahesh Bank and has very few ATM's in the CITY Only. Pity that such rules are made when so many people are simply using the banks to send money. This increases the crowd in Bigger banks and affects their working. I have seen people misbehave and shout for small reasons without knowing the rules. Having every one on the same priority is bad for the Bank and incorrect for those giving good business to the Bank. Such practice should be limited to rural areas.
Posted by:Venkateshwaran - 15 May, 2012
2: Banks should pay maximum interest on the minimum balance which customers have to maintain to open an SB account. This money remains with the banks for ever till the customers close their accounts. Therefore it should be treated as a Super Fixed Deposit. I closed an account after 40 years and the interest on the minimum deposit was only 4%. This was quite shocking. Banks charge for every small thing like issuance of cheque books, verification of signature, deposit or withdrawl of money in another branch of the same account.
Posted by:ALRawal - 09 May, 2012
3: If only this were good for more ATM withdrawals, else what's the point?
Posted by:Richa - 08 May, 2012
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