Banks impose charges for various services and these can be seen on the bank's portal as well as at the time of filling the account opening form. The bank discloses all its charges as per the Reserve Bank of India's directives.
Sometimes, all the bank charges seem almost the same which make a customer ignore the differences. But the distinction can be observed while analyzing the same and comparing the charges which are not generally known. Following are the eight charges which a customer must know:-
1. Charges Related to the Minimum Balance in Account (MAB):
Most of the banks excluding the State Bank of India enforce customer to maintain minimum balance around Rs. 2,000 to Rs.10,000.If the specified minimum balance is not maintained, then the customer has to pay some penalty as account non-maintenance charge. It is about Rs. 250-350 per month in HDFC and Axis Bank respectively.
2. Account Closure Charges:
If the customer wants to close his/her bank account before the minimum specified operation period, he/she has to pay approximately Rs.150-300 for it. ICICI Bank charges Rs.500 if the account is closed within a year from opening.
3. Transfer of Account:
Transferring the account from one branch to another may charge Rs.100-500. SBI charges Rs.102 including postal charges. However some banks allow free account transfer after completion of a specified period of operation.
4. Charges related to Passbook:
Generally banks do not charge for issuing and updating passbook but it could be charged if it is updated from the other branch of the bank in the same or a different city. Ex: SBI charges Rs10 for such operation.
5. Charges relating to Cheque book:
Now, most of the banks issue CTS complied cheque books. At present there is no charge on replacement of old non CTS cheque books. However, issuance later can be charged at Rs.2 per leaf depending on the bank's rule. If the cheque bounces due to insufficient balance then a fine of Rs.100 to 500(approx) is charged. HDFC charges Rs.350 for the first return of cheque in a quarter and thereafter Rs.750 if another cheque returns in the same quarter.
6. Charges relating to Debit cards:
Banks charge a fixed amount annually for giving services of debit card; it is around Rs.50-200. There is also a charge on cash withdrawal of more than specified times from other bank's ATM. IDBI charges Rs.8 per non-financial transaction, like balance enquiry and Rs.20 per financial transaction after 5 transactions in a month from other bank's ATM.
7. Charges on using Internet banking :
Charges on electronic bill payments, money transfer, etc. For instance, charges for payment of Railway e-ticket are Rs.10 to 20 per booking.
8. Cash transaction at branch:
Some banks like HDFC, ICICI, YES Bank are trying to force their customers to use ATMs, Internet Banking, Credit Cards, etc. to reduce their branch maintenance charges. So, they have levied charges depending on the cash transaction from the branches above a certain limit and frequency of transactions. HDFC charges Rs.100 per transaction after free cash transaction limit.
Almost all the banks have a list of charges listed on their website and can be easily checked by anyone. Apart from these, there are some other charges as well which are levied occasionally on some specific activity.
Some customers get annoyed from their banks due to such unknown charges. To avoid sudden and unexpected surprise, customers should choose their banks after analyzing the terms and conditions properly. The banks can be selected on the basis of Service quality, Availability of additional financial services, Affordability on the basis of service cost , etc. Banks are constrained to follow the RBI's guidelines for maintaining transparency in operations. Hence, understanding the terms and conditions would be in the hands of the customer itself, in order to avoid unnecessary charges.