Current RBI Governor Dr. Raghuram Rajan thinks unconventional and totally out of the box. This was yet again demonstrated as the RBI issued two initiatives which will certainly bring cheers from the ‘aam junta’.
Initiative 1: Minors above 10 years can open and maintain bank accounts
When I was 14 year old, I asked my mother (who is still a bank employee) whether I can operate and manage a bank account on my name? She flatly refused, stating that a guardian needs to be present in order to do so. The whole charm of bank account and maintaining cash transactions vanished as I had wanted to do so on my own terms. I was finally able to open my own bank account when I was 18 years old.
But not anymore! Minors (any child who is less than 18 years old) above 10 year old can now open and operate bank accounts on their own, without any parental or guardian requirement. These account would be savings only, and all the regular features such as debit card, cheque book etc would be issued as per the norms.
Thankfully, there won’t be any overdraft facility so that the transactions can be completed under the credit limit only.
This is a huge step towards financial education & inclusion of our young generation, who can experience the pleasures and pains of banking from a young age. And, if seen from a broader angle, this will encourage responsible spending and financial planning from the beginning itself.
Initiative 2: Banks cannot charge penalty on dormant accounts
This is a huge relief for salaried employees and for those who have to open multiple accounts due to necessity and sometimes by mistake.
Banks charge penalty for those accounts which are dormant and not maintaining a minimum-balance. Even though there has been no transaction and the concerned person has not used any banking services, banks do charge a fee just because it’s written in the rules.
I have myself experienced it first hand as I had some 4 to 5 dormant bank accounts, opened by my previous employers. Once the job is left, the account gets neglected and banks start charging penalty on them.
Yes, it is a responsibility of the bank account holder to close the account but the problem is that the account can’t be closed by giving a call to the concerned bank; you need to physically visit the bank, submit an application and complete the due procedures, which are often avoided due to lack of time.
This new initiative by RBI will certainly help to deal with these non-necessary and totally irrelevant maintenance charges levied by banks.
3 cheers to RBI for these 2 brilliant initiatives!