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No penalty if minimum balance is not kept in inoperative bank account: RBI

The Reserve Bank on Tuesday asked banks not to levy penalties on customers who don't maintain a minimum balance in any inoperative account as part of a consumer protection initiative.

‘It is advised that henceforth banks are not permitted to levy penal charges for non-maintenance of minimum balances in any inoperative account,’ RBI said in a notification.

Several banks, including the State Bank of India, do not levy any charge if the minimum balance is not maintained in an inoperative savings account.

The RBI directed banks in 2012 not to charge customers for non-operation or activation of basic savings bank deposit accounts. For operative accounts, customers of ICICI Bank and HDFC Bank are charged Rs 750 per quarter if they don't maintain a minimum average quarterly balance of Rs 10,000 in urban centres and Rs 5,000 in semi-urban areas. In the first bi-monthly monetary policy statement for 2014-15 released last month, the RBI had said banks should also not take undue advantage of customer difficulty or inattention.
‘Instead of levying penal charges for non-maintenance of minimum balance in ordinary savings bank accounts, banks should limit services available on such accounts to those available to basic savings bank deposit accounts and restore the services when the balances improve to the minimum required level,’ it said.

Meanwhile, minors above 10 years of age can open and operate independently savings bank account and use other facilities like ATM and cheque books.The Reserve Bank on Tuesday issued the guidelines allowing minors to operate bank accounts independently with a view to promote financial inclusion and bring uniformity in opening of such accounts in banks. RBI had earlier permitted minors to open fixed and savings deposit bank account with mothers as guardian. Modifying the guidelines, the RBI said that all minors can now open a savings/fixed/recurring bank deposit account through either his/her natural guardian or legally appointed guardian.

The minors who have attained 10 years of age, would be allowed to open and operate savings bank accounts independently.
‘Banks may, however, keeping in view their risk management systems, fix limits in terms of age and amount up to which minors may be allowed to operate the deposit accounts independently,’ the RBI said.

‘Banks are free to offer additional banking facilities like Internet banking, ATM/debit card, cheque book facility, etc, subject to the safeguards that minor accounts are not allowed to be overdrawn and that these always remain in credit,’ the RBI said. On attaining majority, the minor would be required to confirm the balance in his/her account.

If the account was operated by the natural/legal guardian, fresh operating instructions and specimen signature of the minor should be obtained and kept on record for all operational purposes, the RBI said.
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