People often keep their savings in bank accounts for emergencies, but many times customers do not follow the guideline of maintaining a minimum balance in the account. So banks charge them penalties. Public sector banks in the country have earned around Rs 8,500 crore from this minimum balance penalty in the last five years, Minister of State for Finance Pankaj Chaudhary revealed this while answering a question in the Lok Sabha.
He said that even though the country’s largest government bank SBI is not charging a penalty for minimum balance from the financial year 2020, its amount has increased by 38 per cent. He also informed that six out of 11 government banks charged penalties for not maintaining a minimum quarterly average balance. However, four banks – Indian Bank, Canara Bank, Bank of Maharashtra and Central Bank of India – did not impose penalties for not maintaining the minimum balance.
Which bank earned the most?
According to the data, SBI earned the most from minimum balance penalty. The bank had earned Rs 640 crore from this in 2019-20, however, it later stopped collecting the penalty. After this, in 2023-24, Punjab National Bank earned Rs 633 crore from penalty, Bank of Baroda earned Rs 387 crore, Indian Bank earned Rs 369 crore, Canara Bank earned Rs 284 crore and Bank of India earned Rs 194 crore.
What is the minimum balance to maintain in which bank?
Different public sector banks have different arrangements regarding minimum balance and its penalty. For instance, as per Punjab National Bank website, savings account holders are required to maintain a minimum balance of Rs 2,000, Rs 1,000 and Rs 500 in urban, semi-urban and rural areas respectively. Failure to do so can result in a fine of Rs 100 to Rs 250. While for current account holders, the minimum balance for rural, semi-urban, urban and metropolitan categories is ₹1,000, ₹2,000, ₹5,000 and ₹10,000 respectively.
According to the Canara Bank website, a savings account holder is required to maintain Rs 2,000 in urban and metropolitan areas, while Rs 1,000 in semi-urban areas and Rs 500 in rural areas. In case of lesser balance, a fine of Rs 25 to Rs 45 along with GST will have to be paid, depending on the amount. Similarly, there are other provisions regarding penalties as well.
