No Penalty charged on PMJDY Accounts for not keeping Minimum Balance

The Minister of State in the Ministry of Finance, Shiri Pankaj Chaudhary, in a written reply to a question asked in Lok Sabha, said, “No penalty is charged on PMJDY accounts for not keeping the minimum balance.”

The Minister Shri Digvijaya Singh asked the following questions:

Will the Minister of FINANCE be pleased to state-

(a) the rules regarding penalty charges for non-maintenance of minimum balance by Public Sector Banks (PSBs) and Private Sector Banks; and

(b) the number of accounts charged a penalty over the last five years, bank-wise and year-wise?

The Minister of State in the Ministry of Finance, Shiri Pankaj Chaudhary, replied:

(a) and (b) Reserve Bank of India (RBI), vide its circulars dated 20.11.2014 and 01.07.2015, has laid down guidelines regarding the levy of penal charges on non-maintenance of minimum balances in savings bank accounts. Banks are permitted to fix penal charges, in accordance with their Board Approved Policy, provided that the penalties are a defined percentage levied on the difference between the actual balance maintained and the minimum amount agreed upon when the account was opened. Banks accordingly have formulated slab structures for recovery of charges considering different geographies and segments.

As per extant RBI guidelines, banks are required:

i. To inform the customers regarding the requirement of minimum balance at the time of opening the account. Any subsequent changes should also be intimated to the account holders.

ii. In case of non-maintenance of minimum balance, the bank should notify the customer about the penal charges, which will be applicable if the balance is not replenished within one month from the date of notice.

iii. It should be ensured that the savings account does not turn into a negative balance solely on account of the levy of charges for non-maintenance of the minimum balance.

The RBI has informed that it does not keep track of the number of accounts on which penalties are imposed by Public Sector Banks (PSBs) and Private Sector Banks (PVBs) for failure to maintain a minimum balance.

Furthermore, no minimum balance is required for Pradhan Mantri Jan Dhan Yojana (PMJDY) accounts. As a result, no penalty is imposed on PMJDY accounts for failing to maintain the minimum balance requirement.