Bangalore: The Reserve Bank of India has shown its disapproval on the prepayment charges levied by the banks and has instructed the banks to stop such practices. These charges hinder a customer to pay off his loan and move to another with better terms. As per a customer most of the people who avail loans fear paying this extra two percent bank service charge. Even SBI has started levying this charge, reports Rupee Times. The inconvenience faced by the customers came to the RBI's notice while responding to a query on the levied charges under the Right to Information Act. The bank has also notified that it has received many such complaints earlier. By levying such penalty charges, banks want to retain their customers who want to avail a loan with better terms and conditions. "By doing so, banks are limiting their customers' options. Instead they should try to retain them by offering them competitive rates. Doing away with the prepayment charges will help in attracting more customers for the banks," RBI said. Earlier the banks were questioned on the same prepayment charges issue by groups like National Consumer Disputes Redressal Commission have already questioned banks on this issue, yet the banks have failed to come up with a proposal with standard rates.