Reserve Bank of India (RBI) has asked banks to inform their customers about fall in minimum balance well in advance. Penal charges should be levied only to the extent of the shortfall in such balances. These guidelines will come into effect from 1 April 2015.
In the event of a default in maintenance of minimum balance, banks should notify customers clearly by SMS/email/letter, giving them a period of one month to restore the balance to avoid penal charges. RBI said banks should not take undue advantage of customers’ difficulty or inattention. Instead of levying penal charges for non-maintenance of minimum balance in ordinary savings bank accounts, banks should limit the services available on such accounts to those available to basic savings bank deposit accounts and restore the services when the balances improve to the minimum required level.
With several banks deciding to go by the new RBI cap on ATM transactions that curtails the number of free ATM transactions per month, using ATMs for withdrawing cash has become costlier. Banks will reduce the number of free ATM transactions to five per month for its savings account-holders; thereafter the charge will be Rs20 per usage. However, for savings account-holders of other banks, or cross-bank transactions, the number of free transactions has been reduced to three from five previously. This decision comes in the wake of the new RBI guidelines passed in August 2014 and circulated on 1st November for six metro cities, namely, Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bengaluru.
The Tata group’s jewellery brand Tanishq has revived its ‘gold harvest’ scheme which was discontinued a few months ago due to the new Companies Act regarding such schemes as public-deposit schemes. “We have started the gold harvest scheme again last week. We had to come up with a new scheme to comply with the new law. The return now is around 12% and the rate of return cannot exceed 12%, which our previous scheme exceeded. We are planning a national launch soon,” Titan chief executive for jewellery division CK Venkataraman said.
The old golden harvest scheme was popular with customers as they had to deposit equated sums for 11 months; the company paid the last instalment. The customer could then buy gold worth 12 months of deposits.