SBI Savings Account Minimum Balance Comes Down to ₹1,000

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Are you an SBI Savings Bank Account holder? If yes, this news is for you! Country’s largest lender, i.e. State Bank of India (SBI) recently halved the maximum money withdrawal to ₹20,000/- to the previous limit of ₹40,000/-.

Few months ago, SBI announced that the customers holding savings account are required to maintain a sufficient monthly average balance in their accounts. In addition to this, SBI has also specified different monthly average balances (MAB) for the accounts associated with different bank branches and will charge a penalty for non-compliance of the same. Well, that means, the customer will have to pay a penalty for keeping an insufficient monthly average balance, whose amount is determined by the degree of deviation from the required minimum balance. Below are the charges for the non-maintenance of the minimum account balance.

SBI Savings Account Maintenance Charges: Minimum Balance Rules

Talking about the different bank branches for determining the specific amount of penalty, State Bank of India has classified its branches into four types. These branches are: Metro, Rural, Urban and Semi-urban. According to SBI’s website, if you are someone who is holding a savings bank account in a metro or urban bank branch, you need to maintain a monthly average balance of ₹3,000. Account holders in semi-urban SBI branches are required to maintain a balance of ₹2,000, while on the other hand, the customers in rural branches need to keep a monthly balance of ₹1,000.

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Penalty for Insufficient Balance

SBI has slashed charges for not maintaining average minimum balance in savings accounts. The new charges will be effective from April 1, 2018. Metro/Urban Branches: SBI savings bank account holders in metro or urban branches need to pay a penalty of ₹15 from the earlier ₹30-50 plus GST for non-compliance of the same. Earlier, the customers of metro or urban branch, completing a month with a monthly average balance shortfall of up to 50% (₹1,500-3,000) were charged with an amount of ₹30 plus GST as a penalty. However, if the shortfall was between 50% and 75%, an account holder had to pay a penalty of ₹40 plus GST. While on the other hand, those with a shortfall of more than 75% had to pay a penalty of ₹50 plus GST.

Semi-Urban/Rural Branches: Customers holding savings bank accounts in these branches would pay ₹12 and ₹10 GST on not maintaining minimum average balance, much lower than the earlier charge of ₹40 plus GST every month.

For a better understanding, let’s get to the table below showing both the existing and proposed charges on non-maintenance of average monthly balance.

Branch LocationsAMB Shortfall RangeProposed Charges (Per Month in ₹ )Existing Charges (Per Month in ₹)
Metro & Urban Up to 50%

Above 50%-75%

Above 75%
10

12

15
30

40

50
Semi-UrbanUp to 50%

Above 50%-75%

Above 75%
7.50

10

12
15

30

40
RuralUp to 50%

Above 50%-75%

Above 75%
5

7.50

10
20

30

40

Note – Applicable GST will be applied over the charges as stated in the table

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SBI Bank Accounts which are Exempted from Minimum Balance Requirement

You would be glad to know that there are some types of SBI bank accounts which are exempted from the minimum balance requirement condition. Yes, Basic Savings Bank Account, Financial Inclusion Accounts, No Frill Accounts, Salary Package Accounts and Small Accounts are such account types, where SBI doesn’t ask its customers to maintain a minimum monthly average balance.

ATM Cash Withdrawal Limit at SBI

India’s largest lender – SBI has reduced maximum cash withdrawal limit via ATM to 50% which means only ₹20,000/- per day. The new changes will be applicable from October 31, 2018. Until then, you can withdraw ₹40,000/- via ATM per day. The limit has been reduced to curb instances of frauds via ATM. Another purpose is to boost up digital payments since dispite so much given by the government towards digital transactions, India is not yet ready to become Digital India. As per the bank officials, most of the daily transactions are under ₹20,000/- so reducing the limit would not have much effect on customers.

SBI Cash Withdrawal Charges

The cash withdrawal from ATMs will also attract a charge of up to ₹20 if the number of transactions is more than 3 times from other bank’s ATMs in a month and ₹10 for more than five withdrawals from SBI ATMs. However, there will be no charges on withdrawals from the own ATMs of State Bank of India (SBI) within the maximum limit of ₹25,000. In addition to this, in the case of withdrawals by its customers from ATMs of other banks and there will be no charge if the balance exceeds by ₹1 lakh.

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The bank has announced the charges on the closure of the savings bank account. Below are the details of the revised charges on the savings bank account closure.

SBI Savings Bank Account Closure Charges

PeriodExisting Closure ChargesRevised Closure Charges
Free look period - Up to 14 Days of Account OpeningNILNIL
After 14 Days up to 1 Year of Account Opening ₹500 + GST₹500 + GST
Beyond 1 Year of Account Opening₹500 + GSTNIL
Account closed on settlement of accounts of deceased depositors₹500 + GSTNIL
Closure of Regular Savings Bank Account by BSBD Account holders₹500 + GSTNIL

*The above charges are effective since October 1, 2017.

SBI Merger

State Bank of India (SBI) has announced that the chequebooks, IFSC codes of its five associate banks will be invalid from September 30, 2017. This decision has been taken in lieu to SBI Merger with its five associated banks namely State Bank of Bikaner and Jaipur (SBBJ), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Patiala (SBP) and State Bank of Hyderabad (SBH).

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Bajaj Finserv10.99% - 16.00%
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ICICI Bank10.99% - 18.40%
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Kotak Bank8.90% - 8.75%
DHFL9.05% - 9.95%
Reliance Home Finance8.75% - 14.00%