Money & Banking
Banking Service Charges: Our online survey results

A Moneylife online survey on banking service charges shows a growing sense of frustration among customers about the constant and stealthy increase in charges. But many respondents don’t even know about these charges!

Bank customers are frustrated at the ever increasing charges being passed on to them, sometimes with the knowledge, or sometimes keeping them in the dark. In addition to high inflation, escalating costs of health and education, the friendly neighbourhood bank, which promised ease, convenience and efficiency, is quietly springing ever-increasing charges on discerning bank customers. The findings of Moneylife’s survey on banking service charges explained exactly why banks get away with it.


We received 1,579 responses to the survey. About 93% of the respondents have more than one bank account; 40% have more than three bank accounts. A significant majority (67%) have an account in private banks and 57% in nationalised banks. This means that the respondents are educated, tech- and social-media-savvy persons, in the higher income brackets. About 8% have a foreign bank account and 8.5% have an account in a co-operative bank. Around 69% have regular savings accounts, while 31% are high-end, priority customers. Only 25% of the respondents have salary accounts with banks. Surprisingly, 1.2% said they have a no-frills account as well, while 14.6% operate a current account.

The demography of the survey is heavily skewed against the female customers, with 92.6% of the respondents being male. Also, most of the respondents who avail the banking facility are between twenty and sixty years of age.

A third of our respondents (32%) are in the 20 to 35 age group; 26.6% are between 36-45 years, another 26.3% are between 46 to 60 years. Senior citizens, aged between 61-70 years and 71 years and above, constitute 11.5% and 3.6% of the respondents, respectively.


While a large discerning group is aware and angry about the slew of new charges, a shocking 60% of respondents were unaware of various charges and have never checked if their bank announces them transparently. Over 71% of account-holders do not want to change their bank for various reasons—and this is the answer to why banks are able to hike bank charges with such impunity.


We found that customers of private banks and nationalised banks were more aware of costs and charges, while a majority of customers in the two extremes—foreign banks and cooperative banks—responded with a ‘don’t know’ on most cost-related queries. Clearly, account-holders in foreign banks do not bother to check, while those of co-operative banks probably don’t avail of many of these services. Our own research shows that all three categories of banks (foreign, nationalised and private banks) are not very forthcoming about the entire spectrum of bank service charges such as the annual debit card fee, automatic teller machine (ATM) transaction charges, national electronic fund transfer (NEFT), real time gross settlement (RTGS) charges, SMS alert fees, minimum balance requirement and penalties.

Banks levy a slew of service charges on the customers like annual fee for debit card or ATM card, and for a duplicate pin number for the debit card or ATM card number, or for a new card in case of loss or damage. About 43.6% of the customers in nationalised banks reportedly pay between Rs100 to Rs500 annually for the debit card and ATM card. The figure is 17.55% and 14.56% in case of the foreign banks and co-operative banks respectively. Our survey has revealed that often people do overlook, or ignore certain charges, which are slyly introduced by the banks: for example, charges levied after the sixth transaction at ATMs. More than 50% of the respondents were simply unaware of the amount charged in these cases.


There are a plethora of charges that banks levy on various issues. But the most startling insight of the survey is the fact that in spite of not being fully satisfied with the services of their individual banks, majority of our respondents refused to change the bank. Our survey shows that about 36% of our respondents do not consider changing their banks because they have their salary linked with the bank and a whooping majority of 49% consider it as too much trouble to change the bank account.


In the cases of returned cheques, 48.8% of the customers in foreign banks and 46.5% of the customers in cooperative banks do not know that they are charged. Anywhere between Rs50 to Rs500, with the exception of IDBI Bank. The story is the same with the Electronic Clearance Service (ECS) and National Electronic Money Transfer, where the customers are unaware of the amount charged from them. Taking a cue from the strong campaign by Moneylife magazine, along with bank unions, the RBI assured us that it would facilitate electronic transfers as prescribed by the Damodaran Committee. An astounding majority of 65% of the respondents in our survey never knew the banks have account closing charges, especially if the account is deactivated within a year.


In the recent past, Moneylife has written about various charges levied on the customers by the banks.




Yash Verma

3 years ago

You have done yeoman's service by conducting this survey but am afraid it is not going to help the common man because he is too lazy to change the bank fearing hassles. It is not a big deal to change the bank, believe me. Yash Verma, Pune

kaushik shukla

3 years ago

the outcome of survey is an eye opener for common man , however this will not change the mindset of people, they still will continue with same bank.

pawan agrawal

3 years ago

we must take up this issues in the criminal court

Vaibhav Dhoka

3 years ago

Most of banks levy one or other charges silently.In case of Bank of Maharashtra Bhawani peth,Pune branch where I have savings account ,bank charges me Rs 6 on two occasion one while applying for United India's bank assurance on 27/6/2013 and another by paying Rs 10000=00 by payslip to other savings account 24/9/2013.No where these charges are listed on banks website.As amount is small customer overlooks same.

Where did Syria’s chemical weapons come from?

There is intriguing evidence pointing at long-ago help from Moscow, and help from Western European countries

In the wake of a recent Russian-U.S. deal averting American airstrikes, Syria has begun to answer questions about its chemical weapons stockpile. One thing inspectors don’t have the mandate to ask is where those weapons came from in the first place. But evidence already out there suggests Syria got crucial help from Moscow and Western European companies.

When Secretary of Defense Chuck Hagel was asked recently about the origins of Syria’s chemical weapons, he said, “Well, the Russians supply them.“ Hagel’s spokesman George Little quickly walked back that statement, saying Hagel was simply referring to Syria’s conventional weapons. Syria’s chemical weapons program, Little explained, is “largely indigenous."

But declassified intelligence documents suggest Hagel, while mistakenly suggesting the support was ongoing, was at least pointing his finger in the right direction.

A Special National Intelligence Estimate dated Sept. 15, 1983, lists Syria as a “major recipient of Soviet CW [Chemical Weapons] assistance.” Both “Czechoslovakia and the Soviet Union provided the chemical agents, delivery systems, and training that flowed to Syria.” “As long as this support is forthcoming,” the 1983 document continues,” there is no need for Syria to develop an indigenous capability to produce CW agents or materiel, and none has been identified.”

Soviet support was also mentioned, though with less details, in another intelligence estimate dated Feb. 2, 1982. That report muses about the U.S.S.R.’s motivation for exporting chemical weapons to Syria and other countries. The Kremlin saw gas as useful for allies fighting against insurgencies: For the countries that had actually used it in combat – Kampuchea, Laos, Afghanistan and Yemen - the authors conclude that the Soviet Union saw it as a way of “breaking the will and resistance of stubborn guerrilla forces operating from relatively inaccessible protected sanctuaries.”

The 1982 report goes on to say: “The Soviets probably reasoned that attainment of these objectives – as quickly and cheap as possible – justified use of chemical weapons and outweighed a small risk of exposure and international condemnation.” Last week, German newspaper Süddeutsche Zeitung reported that intelligence sources in the country are convinced blueprints for four of the five Syrian poison gas plants came from Moscow.

Evidence gathered from what we now know was a sarin attack last month is also suggestive. According to an investigation by Human Rights Watch, one of the weapons used in the attack was “a Soviet-produced 140mm rocket.” Meanwhile, the UN’s own report shows a picture of Cyrillic letters on the remnants of the rocket.

It’s impossible to know the exact extent of Soviet and Russian help. U.S. intelligence was not particularly focused on the Syrian program, says Gary Crocker, a proliferation specialist at the State Department’s Bureau of Intelligence and Research in the 1970s and 1980s. Most analysts did not know much about its program: “Detailed information on the Syrian program was only accessible to very high level intelligence officials,” Crocker said.

There are also indications that the Soviets grew increasingly uneasy with Syria’s ability to deliver the deadly gas by long-range missile. Concerned about Syria’s buildup, the head of the Soviet chemical warfare corps, General Vladimir Pikalov,flew to Syria in 1988. According to reports from the time, he decided against supplying the country with SS-23 missiles, which would have been able to deliver poison gas deep into Israel.

But the Soviets don’t appear to be the only ones who provided some help.

“Soviets provided the initial setup, then the Syrians became quite proficient at it. Later, German companies came in,” Crocker said.

As then- CIA director William Webster said in Senate testimony back in 1989: “West European firms were instrumental in supplying the required precursor chemicals and equipment.” Asked why the companies did it, Webster answered: “Some, of course, are unwitting of the ultimate destination of the products they supply, others are not. In the latter case, I can only surmise that greed is the explanation.”

Indeed, Syria received precursor chemicals from the West until well into the last decade. Last week, the German government acknowledged that between 2002 and 2006, it had approved the export to Syria of more than 100 tons of so-called dual-use chemicals. Among the substances were hydrogen fluoride, which can be used to make Teflon, and also sarin. The exports were allowed under the condition that Syria would only use them for civilian purposes. The British government also recently acknowledged exports of dual-use chemicals to Syria.

Both the British and German governments said there’s no evidence the chemicals were used to make weapons.

It’s not the first time Germany may have turned a blind eye to potentially dangerous trade. In the 1980s, for instance, German and French companies were crucial in building poison gas plants in Iraq and Libya . Stricter export controls in Europe were only installed after a web of companies that supplied the chemical weapons programs in the Middle East was exposed in the late 1980s. The New York Times embarrassed the German government by revealing the connection between German company Imhausen-Chemie and a Libyan poison gas plant in Rabta. (Times columnist William Safire German later called the plant “ Auschwitz-in-the-sand.”)

In the following years, German authorities indicted more than 150 managers of companies involved in Saddam Hussein’s program, which he had used to kill thousands of Kurds. According to one report, from the late ‘90s, more than half of the proceedings were stopped. Most of those that went to trial were acquitted or paid fines, a handful received jail time.

Just how deeply were German companies involved in Syria’s program? We may never know. A long-ago proposal by the German Green party to install a fact-finding commission to comprehensively investigate the web of German companies supplying Middle Eastern states – and government knowledge of these exports - was voted down by all other parties in parliament.



Sensex, Nifty head lower: Wednesday closing report

For Nifty to arrest its downtrend, Nifty has to close above 5907

Except for a small positive move, which happened yesterday, the market fell for the third day, ahead of the expiry of the futures and options which is tomorrow. Except for a little while when the indices today moved in the green, the benchmarks were pulled down in to the negative and stayed there till the end of the session.


The Sensex and the Nifty, for the first time after three trading session, opened in the positive. The Sensex opened at 19,947 and immediately hit its daily high of 19,978 while the Nifty opened at 5,902 and hit a high of 5,911. In the noon session the indices hit their lows after which they made smart recovery. The Sensex hit a low of 19,659 and closed at 19,856 (down 64 points or 0.32%). The Nifty hit a low of 5,811 and closed at 5,874 (down 19 points or 0.32%). The National Stock Exchange (NSE) recorded a volume of 59.53 crore shares.


The top five gainers among the other indices on the NSE were Media (2.60%); PSU Bank (1.76%); Infra (1.59%); Pharma (1.32%) and PSE (1.21%) while the top five losers were FMCG (1.00%); Finance (0.99%); Bank Nifty (0.93%); Energy (0.91%) and Realty (0.25%).
Of the 50 stocks on the Nifty, 22 ended in the green. The top five gainers were BHEL (8.91%); Sesa Goa (4.34%); Hindalco (3.75%); State Bank of India (2.86%) and NTPC (2.51%). The top five losers were BPCL (3.28%); Reliance Industries (3.21%); HDFC Bank (2.91%); M&M (2.81%) and DLF (2.64%).

Minister of Petroleum & Natural Gas Dr M Veerappa Moily on Tuesday, 24 September 2013, ruled out any steep increase in diesel and cooking-fuel prices. The government's decision on Tuesday, 24 September 2013, not to raise fuel prices has sparked concerns about the government's fiscal deficit. Moily asked the people of India to conserve petroleum products to help the government's finances and reduce the country's oil-import bill.


The Cabinet Committee on Economic Affairs on Tuesday approved the proposal of the ministry of petroleum and natural gas on the policy on exploration and exploitation of shale gas and oil by National Oil Companies (NOCs) on acreages under the nomination regime. This policy will allow NOCs to carry out exploration and exploitation of unconventional hydro-carbon resources particularly, shale gas and oil in their already awarded onland petroleum exploration license/petroleum mining lease acreages under the nomination regime.


Cabinet Committee on Economic Affairs on Tuesday approved the methodology for auctioning coal blocks, enabling the government to allot coal mining licences through competitive bidding to private companies.


Prime Minister Manmohan Singh constituted the 7th Pay Commission today. The new pay scale recommended by the Pay Commission will be implemented from 1 January 2016.


The government is formulating a scheme to encourage technological acquisition and R&D activities in the capital goods sector to help reduce dependence on imports of such goods.


US indices had a mixed performance on Tuesday. The drop in consumer confidence and worries over a Washington debt-ceiling fight outweighed a rise in home prices and easing concerns over the Middle East.


Investors are worried about Washington’s new budget for the fiscal year that starts on 1 October 2013 and, more importantly, over whether to lift the debt ceiling. Ratings firm Moody's Investors Service on Tuesday said a failure by the US government to raise the country's debt limit would result in a worse outcome for financial markets than a government shutdown.


The Conference Board's index of US consumer confidence slumped in September to a four-month low and a separate report showed a gauge of manufacturing in the region covered by the Federal Reserve Bank of Richmond shrank in September. The Case-Shiller report on US home prices showed prices rose in July, but at a slower pace.


US President Barack Obama on Tuesday said that the US is committed to finding diplomatic solutions for the Syria conflict and for the ongoing dispute with Iran over its nuclear program.


Except for Hang Seng (up 0.13%) and NZSE 50 (up 1.15%) all the other Asian indices ended in the negative. Jakarta Composite, top loser, down 1.20%.


European indices were trading mostly in the red. US indices too were trading in the negative.


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