The country's largest bank, State Bank of India, on Thursday said that the bank has retained charges on cash withdrawals over and above four free withdrawals per month but has stopped recovering charges in such accounts on all digital transactions.
The Reserve Bank of India, in August 2012, had mandated that banks are free to levy reasonable charges in BSBD (Basic Savings Bank Deposit) accounts beyond four free transactions. The availment of such additional services shall be at the option of the customers, it had said.
In view of the regulations, the SBI introduced charges for debit transactions beyond four free transactions in BSBD accounts with effect from June 15, 2016 with prior intimation to the customers.
In August 2020, the Central Board of Direct Taxes (CBDT), however, advised banks to refund the charges collected, if any, on or after January 1, 2020 on transactions carried out using the digital mode and not to impose charges on future transactions carried out through such modes.
The objective is also to encourage BSBD account holders including PMJDY account holders to adopt digital payment through the prescribed modes vis-a-vis the cash transactions.
In terms of CBDT directives, the SBI refunded the charges recovered in respect of all the digital transactions to the BSBD customers with effect from January 1, 2020 to September 14, 2020. Additionally, SBI has stopped recovering charges in such accounts on all digital transactions from September 15, 2020, while retaining charges on cash withdrawals.
The bank has also waived fees levied on SMS services and on maintenance of monthly average balance to all its Savings Bank account holders while promoting financial inclusion in the country.