Bank is a safe place for people to invest and save their money. In India most of the banks works on the order of Reserve Bank of India (RBI). The term Bank specifies of conducting or maintaining customers or companies account, paying or collecting cheques on behalf of customers and maintaining records in terms of account statements for customers. All the Banks follow the basic principles of Accounting where debit is what comes in and credit is what goes out, Debit all expenses or loss and Credit is all incomes or gain and debit is the receiver and credit is the giver.
Previously transacting from banks or cheques or Automated Teller Machines were the only modes of channels but now we have Call center, Mobile Banking, Online Banking too from where we can transact our transaction. As per RBI there are many rules and regulations which need to be followed by banks as well as by customers before doing any transaction.
Below are few things to remember to avoid fees or penalties on your account.
Minimum Balance Limit: Some Banks give an option to have zero balance account while some expect their customers to maintain Rs. 10,000/- as their quarterly balance. The person who has zero balance does not have to worry much however the accounts with minimum balance limit of Rs.10,000/- needs to maintain the same during the quarter else will be levied with a fine. Try to keep a regular check on the account to avoid minimum balance limit fine.
ATM Machines: Currently if you are using an ATM card or Debit card at your own bank ATM’s then you are not levied with any charges. But if you use any other banks ATM for withdrawing cash, checking balance or changing ATM PIN you will be charged a fine to use their ATM if it exceeds more than five transactions. If it’s a cash withdrawal from a Non-Bank ATMs then you will be charged rs.20 and for a non cash transaction the charges are rs.9.
Ignoring Bank Documents: Many of us overlook the bank documents like account statements, overdraft notices or other important documents sent by them. The account statements can be required for many several reasons like opting for housing loans, address proof, applying for credit card but if we overlook this statement then we will be levied for charge to get the duplicate statement from bank. Yes there is a process of getting the statements online by online banking but it’s for those who know how to use the online facility. Also there are many offers and discount coupons sent by bank for your benefit but if you ignore them and throw it away you will lose the opportunity of buying things on discount.
Returned Cheque: Returned cheque happens when a customer has issued a cheque and it returns or bounces (not honored) due to several reason then a penalty is been charged both to the sender as well as to the receiver. If you have issued a cheque and it bounces due to insufficient funds then you are charges with a high penalty. But if someone else have deposited the cheque in your account and it bounces then you will be charged but for a lesser amount. The amount varies from Rs. 100 to Rs. 750 or sometimes it may result into criminal cases.
Stop payment: Stop payment happens when you have issued a cheque but suddenly informs the bank to not clear or to stop the payment due to some reason than will be charged with a higher penalty fee by the bank. However many banks do not charge the penalty if the stop payment is done online.
Account Closure: Most of the customers are not aware that some banks do charge fee if the account is closed within six months to one year of opening account. Also there are circumstances that the customer had a zero balance salary account with ABC bank from XYZ Company. Now he leaves XYZ and joins MNO Company and from there he gets salary account from JKL bank. Now after few months or a year the salary account of ABC bank will convert into the savings account and as per bank policy will have to maintain the minimum balance limit and if fails will be charged with a fine for non maintenance. Hence it is always good to close the previous bank account if you are not using it else will be charged with some or the other fine which you are not even aware of.
I hope you all have a clear understanding on how to get rid of fines and penalties. These charges can be avoided if we have a look at our bank account on daily basis or at least twice in a week. Hence it is always recommended to monitor your bank accounts and stay away from the known/ unknown charges.