The State Bank of India (SBI) on Thursday issued a clarification after a recent study claimed that the bank was levying 'unreasonable' charges for various services provided to zero-balance account or basic savings bank deposit (BSBD) account holders.

The study by IIT-Bombay found that the largest public sector bank of India had collected Rs 300 crore from additional charges on various services provided to BSBD account holders.

The study claimed that the SBI’s decision to levy a charge of Rs 17.70 for every debit transaction beyond the four free transactions in a month on BSBD accounts cannot be considered as reasonable.

The SBI in its statement said that in August 2012 the Reserve Bank of India (RBI) had announced that banks were free to charge reasonable fees on services after four debit transactions a month. Accordingly, SBI introduced charges for debit transactions beyond four free transactions in BSBD accounts with effect from June 14, 2016 with prior intimation to the customers.

In August 2020, the Central Board of Direct Taxes (CBDT) had advised the banks to refund all fees collected from account holders for making digital transactions on or after January 1, 2020. The CBDT also asked banks not to collect any further charges for digital transactions from account holders, in order to encourage cashless transactions.

The CBDT suggestion came on the basis of an older directive from RBI which was released in August 2019. The RBI directive asked banks to provide basic minimum services to BSBD account holders without levying any fees on such services. These included depositing cash and four minimum monthly withdrawals.

The SBI claimed that following the CBDT circular, it has refunded the charges collected for all digital transactions to the BSBD account holders with effect from January 1, 2020 to September 14, 2020. The bank has stopped recovering charges in such accounts on all digital transactions from September 15, 2020 onwards.

SBI, however, still retains the charges on all debit withdrawals after four free transactions in a month.

The bank explained that the reasoning behind these charges is to encourage BSBD account holders including Pradhan Mantri Jan Dhan Yojna (PMJDY) account holders to switch to cashless transactions. The bank has also waived fees levied on SMS services and on maintenance of monthly average balance to all its Savings Bank account holders.

“Customer Centricity has always been the Bank’s focus. SBI has been determinedly working towards offering a convenient banking experience to all its diverse range of customers," SBI said in its statement.

(Edited by : Jomy)