RBI Stops Banks From Charging Minimum Balance Charges On These Accounts: Huge Relief For Bank Customers?


Mohul Ghosh

Mohul Ghosh

Jan 06, 2024


The Reserve Bank of India (RBI) has issued new guidelines for banks regarding inactive accounts. As per the rules, banks cannot charge penalty fees to customers for not maintaining minimum balances in accounts that have been inactive for over two years.

RBI Stops Banks From Charging Minimum Balance Charges On These Accounts: Huge Relief For Bank Customers?

An inactive account is defined as one that has not had a customer-induced transaction for two years or more. However, accounts opened for receiving direct benefit transfers or scholarships should not be treated as inactive regardless of transaction history.

RBI: No Minimum Balance Charges

The amended guidelines will come into effect from April 1st, 2024. Their purpose is to help reduce the growing volume of unclaimed deposits in bank accounts across India.

Banks have been directed to inform account holders via written communication when their accounts turn inactive. If the account holder does not respond, the bank should contact their nominee or introducer on record.

Inoperative Accounts Need Not Pay Charges

As per the RBI, inactive accounts cannot have any penalty charges levied for non-maintenance of minimum balance. Reactivation of such accounts will also be free of charge.

The central bank report shows unclaimed deposits rose 28% to Rs. 42,272 crore in March 2023. Banks transfer balances of accounts unused for 10 years or more to the RBI’s Depositor Education and Awareness Fund.

Earlier RBI guidelines prohibit banks from allowing account balances to turn negative due to non-maintenance fees. However, violations of the rule have occurred in some cases.


Mohul Ghosh
Mohul Ghosh
  • 1722 Posts

Subscribe Now!

Get latest news and views related to startups, tech and business

You Might Also Like

Business
Dec. 8, 2022

Beat The Burden Of Medical Inflation With A Health Insurance

As disease rates rise and medical technology develops, treatment costs climb. It’s essential to understand that medical costs are not exclusively associated with hospitals. The cost of prescription drugs, diagnostic procedures, ambulance and operating room fees, consultations with doctors, and other costs are also constantly increasing. All of them could put a big strain on […]

Business
Dec. 8, 2022

3 Biggest Changes Of iOS 16.2 Update That Every iPhone User Should Know!

In its latest update Apple said that it is preparing for the iOS 16.2 update for iPhones across the world. Notably, like the previous release, there are a couple of changes coming for the iPhones.  iOS 16.2 Update Release Date So far, Apple has not announced a release date for iOS 16.2 update. Reportedly, the […]

Business
Dec. 8, 2022

300 Microsoft Employees Create Employee Union, First Time Ever: This Is How Microsoft Reacted

Around 300 workers at Microsoft Corp.’s ZeniMax Studios have commenced the process of forming a union which is said to be the first at the software giant in the US.  Here, Microsoft Corp.’s ZeniMax Studios known for popular video games including Skyrim and Fallout. Forming Union In Microsoft Corp Moreover, the quality assurance employees at […]

Business
Dec. 7, 2022

India Beats China In Air Travel Safety: Ranking Jumps From 102 To 48 In Global Aviation Safety

India’s air safety protocols and executions have improved drastically over the years, as validated by the findings of a specialized agency of the United Nations, the International Civil Aviation Organization or ICAO. The UN watchdog has upgraded India’s ranking in terms of aviation safety to the 48th position, jumping past the rankings of countries like […]

Recent Posts

Related Videos

   

Subscribe Now!

Get latest news and views related to startups, tech and business

who's online