The Reserve Bank of India (RBI) has increased the scope of free facilities for Basic Savings Bank Deposit (BSBD) accounts with zero balance. The Reserve Bank has instructed banks not to consider these accounts as an ‘inferior’ or ‘makeshift’ option, but to provide them with the same service as a normal savings account.
If someone submits a written or online application, the bank will have to convert the savings account into BSBD within 7 days. These instructions will be effective from April 1 next year.
According to Economic Times, banks have also been told that if any customer requests, his existing savings account should also be converted into BSBD account. According to the new rules, every BSBD account should have the facility to deposit cash, withdraw money online or through cheque. Also, there will be no restriction on depositing money any number of times in a month.
These facilities will be available
- Customers will get an ATM or ATM-cum-debit card without any annual charge.
- You will also get a check book with at least 25 pages in a year, free internet and mobile banking and free passbook or monthly statement.
- Withdrawal of money at least four times in a month will be free.
- Digital payments – like card swipe (PoS), NEFT, RTGS, UPI and IMPS will not be counted towards this four-time limit.
Banks will not accept any condition
These facilities will be available only on demand of the customer and banks cannot make them a condition for opening or operating an account. Those who already have a BSBD account, if they request, they will also get these new free facilities. If banks want, they can provide some extra features but they cannot impose the condition of maintaining ‘minimum balance’. It will be the choice of the customer whether they want to get that feature or not. There is no need to deposit any money to open a BSBD account.
RBI rejected banks’ suggestions
Banks had suggested that certain conditions should be fixed for opening BSBD accounts based on the income and profile of the customers. But the Reserve Bank has rejected this suggestion. The Reserve Bank says that imposing such conditions will not fulfill the purpose of the BSBD account, which is to provide an affordable banking product to all.
Banks had also said that these accounts could be misused, such as for money laundering. Therefore they wanted that facilities like internet and mobile banking should be banned. But RBI did not accept even this demand. Banks had also said that they want to impose some restrictions on depositing money or maintaining balance in the accounts of minors, so that the risk can be reduced. The Reserve Bank has accepted this.