Mumbai, April 6: India’s largest lender State Bank of India has introduced a slew of measures as part of its recent revamp. The changes include newly-introduced transaction charges, penalties on not maintaining minimum account balances and transfer of customers from the recently merged associate banks among other key steps. The measures

The changes are part of State Bank of India‘s plans to launch a brand new identity and place itself among the world’s leading banks. Further intentions include plans to make the bank more technology savvy, modern and able to meet the growing financial needs of the population.

It is for the same reason that SBI’s 5 associate banks including the State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Hyderabad, State Bank of Travancore, State Bank of Patiala and Bharatiya Mahila Bank (BMB), have been merged with the main bank.

Speaking of the changes, SBI chairman Arundhati Bhattacharya has said in a statement, “Also along with the merger…we felt the need to position SBI as a contemporary brand, ready to connect with a diverse audience in a world that is rapidly going digital.”

Commenting on the changes to the bank logo, the bank said, “The monogram has been refined for greater clarity and ease of use. The iconic SBI Blue has been refreshed, and the family of colours expanded for scale of usage and approachability. The overall visual language has been designed to ensure consistency and recall across all touch-points.”

Key changes adopted by SBI from April 1:

  • State Bank of India has introduced a mandatory requirement of a minimum account balance for all of its customers. The amount, which will is reserved as the monthly average balance (MAB) requirement, has been established keeping in mind the location of the customer. The MAB amounts have been divided into four location-based categories as ‘metro’, ‘urban’, ‘semi-urban’ and ‘rural’.
  • While the Monthly Average Balance has been fixed as Rs 5000 for metros, the MABs for urban and semi-urban branches has been fixed at Rs 3,000 and Rs 2,000 respectively. On the other hand, customers based in rural India will have to maintain a sum of Rs 1000 as the minimum balance in their accounts.Earlier, the monthly average balance (MAB) for a savings account across the country was Rs 500, for those without the facility of a chequebook and Rs 1,000, for accounts with the cheque book facility.

  • Non-compliance to the assigned Monthly Average Balance will attract penalties. The penalty will vary between  Rs 20 and Rs 50 for rural areas and between Rs 50 and Rs 100 for all the other regions. The above rule, however, will not be applicable to the holders of Surabhi, Basic Savings Bank and PM Jan Dhan Yojana accounts.
  • The bank has also introduced transaction limits on customers depending on the region. While transactions in metropolitan regions will be limited to three a month from SBI ATMs, people residing in rural, semi-urban and other parts of the country will be allowed to withdraw cash from ATMs five times in a month.
  • Further, State Bank of India customers can also use ATMs of other banks 3 times a month in urban areas and 5 times a month in rural areas. The bank has permitted account holders with more than Rs 1,00,000 bank balance to withdraw money an unlimited number of times a month. However, a Rs 50 charge will be applicable for every transaction above the set limit.

Transaction Charges final

  • SBI has also introduced limits on the number of transactions that can be carried out via mobile and internet banking for customers with a minimum average balance of Rs 25,000 and below. Account holders possessing sums between Rs 1,000 and Rs 25,000 in their account, can use debit transaction facilities twice a month via bank branches and 40 times via online and mobile banking. Those with balances below Rs. 1,000 can use online and mobile banking facilities only 20 times a month.
  • The State Bank of India has also inducted various fees on services that were earlier provided for free. Apart from increasing the locker rent, the free locker usage by customers has been limited to 12 times a year. After this limit, customers will have to pay Rs 100 and the applicable service tax for visiting their own locker. Charges on cheque books have been increased to Rs 75 (plus service tax) for a 25-leaf chequebook and Rs 150 (plus service tax) for a 50-leaf chequebook.

The above slew of measures have obtained mixed reactions from the bank’s customers across India. While some have called for a no transaction day today as a mark of protest, many are disappointed that India’s prime public sector bank has incorporated more charges for various services as compared to key private banks. Here is the minimum account balance as required by various banks:

Comparison with other banks

While leading banks such as HDFC Bank and Axis Bank require that the minimum account balance be maintained at Rs 10,000 in metros and urban areas and Rs 2,500 in rural areas on a quarterly basis, the State Bank of India requires a minimum balance of Rs 5000, 3000 and 1000 respectively. Other nationalised banks, however, require much lesser amounts as monthly average balances in accounts. Among them, Bank of Baroda and Punjab National Bank require only sums of Rs 1000 for metros and urban areas and Rs 500 for rural areas on a quarterly basis from their customers.