In order to attract new customers, State Bank of India (SBI) has done away with minimum balance criteria for saving banks account. The bank will not levy any charge for breaching minimum balance criteria.
The facility is available to existing customers also, SBI said in an advertisement.
For the normal SBI savings account with cheque book facility, a customer had to maintain a minimum balance of Rs 1,000 in his or her account failing which it attracted penalty.
The waiver would help the bank in improving customer base, an official said, adding, it will also help the bank in generating low cost deposits as the savings bank account earns interest rate of just 4%.
As of March 2012, SBI had 15.39 crore saving banks accounts. During 2011-12, the bank opened 2.19 crore such accounts.
On the other hand, the minimum balance requirement for savings bank account of private sector bank like ICICI Bank, and HDFC Bank is Rs 10,000.
It is high time that banks like ICICI and Axis Bank review their quarterly average minimum balance requirements. These banks charge as much as Rs 800 and above if the amount falls below the minimum balance requirement.
