Banks Offer Zero-Balance Accounts To Promote Financial Inclusion: Sitharaman

(MENAFN- KNN India) New Delhi, Mar 9 (KNN) Finance Minister Nirmala Sitharaman on Monday said that banks provide zero-balance savings account facilities to ensure financial inclusion and universal access to banking services.

Replying to a question in Lok Sabha, the minister said Basic Savings Bank Deposit Accounts (BSBDAs), including accounts opened under the Pradhan Mantri Jan Dhan Yojana, do not require a minimum balance and are exempt from penal charges. These accounts provide basic banking services such as deposits, withdrawals and ATM access free of charge.

According to the government, around 72 crore BSBDAs, including Jan Dhan accounts, are currently not subject to penalties for non-maintenance of minimum balance.

For savings and current accounts other than BSBDAs, banks may levy charges for not maintaining the Minimum Monthly Average Balance (MAB) as per board-approved policies and regulatory guidelines issued by the Reserve Bank of India. The RBI requires such charges to be reasonable, transparent and aligned with the cost of providing banking services.

The minister said Public Sector Banks (PSBs) collected about Rs 8,092.83 crore between FY2022–23 and FY2024–25 from customers for non-maintenance of MAB in savings and current accounts.

However, this amount accounted for only 0.23 percent of the total income of PSBs during the period, indicating that such charges form a small portion of overall bank revenues.

She added that several PSBs have reviewed their service charge structures to enhance customer-centric banking. State Bank of India had already waived penal charges for non-maintenance of minimum balance in savings accounts in March 2020, and nine more PSBs abolished such charges in 2025, while the remaining two banks have rationalised the charges.

The minister also said the RBI does not maintain information regarding court judgments on waivers or refunds of such penalties. As per available information, no general direction has been issued by the Supreme Court of India or any High Court mandating banks to waive or refund these charges.

Banks are required to notify customers through SMS, email or other means when minimum balance requirements are not maintained and generally provide time for customers to restore the balance before any penal charges are applied, in line with RBI guidelines.

(KNN Bureau)

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