State Bank of India, India’s largest bank, has clarified that it did not suo motu close 41.16 lakh accounts, citing its closure due to merger of the bank with its associate banks as the reason.
The merger of SBI and associate banks prompted depositors to close accounts
State Bank of India, India’s largest bank, has clarified that it did not suo motu close 41.16 lakh accounts, citing its closure due to merger of the bank with its associate banks as the reason.
In April 2017, five associated banks were merged with SBI.
As a fallout, customers who held multiple accounts in different associate banks as well as in SBI closed their savings bank accounts, SBI said. This led to higher than usual number of accounts closing during the year.
Customers who have not been maintaining their average monthly balance in these accounts have been provided the option of converting their regular savings accounts to basic services accounts free of charge, the bank said.
Meanwhile, the service charge for non-maintenance of average monthly balance has been reduced by 75 per cent from 1 April 2018.
Over 2 crore new accounts
The bank said about 2.1 crore new savings accounts were added in fiscal 2017-2018. Of this, 1.1 crore accounts are Jan-Dhan or basic savings accounts, which are exempt from the requirement of maintaining an average monthly balance.
SBI currently has 41 crore savings bank accounts.