RBI: No More Negative Balance In Your Savings Accounts

The Logical Indian

May 18th, 2016 / 1:10 PM

Source: Times of India | Image Courtesy: genxhelp fablefeed

The RBI has issued a directive that negative balance will not be imposed on saving accounts as penalty charges. The central bank has asked the banks to immediately stop imposing charges for not maintaining a minimum balance once the balance touches zero, reported Times of India.

The same norm came into effect last year, yet several banks were still continuing to impose negative balances in savings accounts until now. In case if banks still continue such practice, then the RBI has given the customers an option to approach the banking ombudsman.


What is negative balance?
When salary accounts are opened with a bank, the banks usually waive minimum balance requirements. However, if the customer quits his/her job, then the account does not remain salary account any more. Since there is no salary flow, the begins to debit an amount as penalty for not maintaining the minimum balance, which often results the balance to turn negative. This is called negative balance.

Although the banks do not look to recover funds from negative balance accounts, but the customer loses money if he/she deposits money in the account.

Banks like HDFC, ICICI, Axis have maintained to Times of India that they do not create negative balance.


The Logical Indian believes this will provide benefit for the customers and will result into creation of more bank accounts in India.


Contributors

Written by :

Edited by :

Related Stories

SBI

SBI Closes Over 41 Lakh Savings Accounts For Not Keeping Average Minimum Balance 

SBI

SBI Slashes Charges For Non-Maintenance Of Minimum Balance In Savings Account Up to 70%

Sugar

How The Sugar Industry Hid Negative Health Impacts Of Sugar For More Than 60 Years

RBI Clarifies It Is Mandatory For Bank Accounts To Be Linked With Aadhaar Under Money Laundering Act

Aadhaar

Never Passed Order To Link Bank Accounts With Aadhaar: RBI In RTI Reply

SBI Waives Closure Charges For Savings Accounts That Are Over Six Months Old

Latest on The Logical Indian

My Social Responsibility

My Story: “I Arranged My Own Intercaste Marriage & Helped 150 Other Such Couples Get Married”

News

In A Peculiar Bid To Combat Water Crisis, UP Assembly Adopts Half Glass Water Policy

Exclusive

Bihar Flood: This Group Of Student Volunteers Are Extending Help Flood Victims

Get Inspired

#SareeTwitter: Saree As A Tool Of Revolution, Power & Politics

Awareness

Community-Based Care Improves Lives Of Rural Elderly

Awareness

How The Legacy Of A Colonial Hunter Has Inspired Conservation Efforts In The Forests Of South India

x

Stories that deserve attention, delivered to your inbox!

Handpicked, newsworthy stories which deserve the attention of a rational generation.