LOOT: It would be more economical to withdraw cash from a bank for which you pay only Rs10 as against withdrawing from an ATM which will cost you Rs21 per transaction.

By Arvind Pinto

Public sector banks have started looting and plundering the aam aadmi again for putting their trust in nationalized banks. Not only has the rate of interest on fixed deposits fallen sharply, steep charges have been slapped on every routine service. To add insult to injury the customer has to pay Rs10 on every cash transaction. But going digital is not going to save your money as ATM and debit card charges have also been raised.

POST-DEMONETIZATION the government has slowly but surely ensured that Indians use the banking system to store or hoard their money. The government of the day wishes that all economic transactions are made through the medium of the banks. Go into any bank and one will realize the problems of either withdrawing or even depositing cash. Now with the return of covid the lines outside banks are no longer for exchanging your old notes, but for either depositing or removing money from your account.

MINIMUM AVERAGE BALANCE
ALL banks require their customers to maintain a minimum monthly average balance in their accounts. For most banks the minimum required to be maintained is Rs10,000 in urban locations and Rs1,000 in villages. Failure to maintain the minimum average balance will result in the bank debiting the account 5% on the shortfall. For a bank customer who uses the bank to park his monthly earnings, sometimes maintaining a minimum becomes hard. Further being penalized for withdrawing one’s own money is like paying the bank for parking one’s hard-earned money with the bank.
Further, the penal rate that the bank charges its customers is further increased by a proportionate tax called Goods & Services Tax (GST). Therefore, the customer not only pays a penal charge for a fall in the minimum balance but also increases the government coffers with GST.

CANNOT WITHDRAW YOUR OWN MONEY!
IN the drive to make Indians use the banking system for their financial transactions, the government of the day has made the opening of bank accounts mandatory. Today most Indians put their income and savings into a bank account. But should a person wish to withdraw her own money from the bank, there are restrictions regarding withdrawal. Most banks have a limit of Rs1 lakh using a self cheque for withdrawal. Thus, you have a transport operator who has to be paid Rs1.20 lakh, who will not be able to go to the bank to withdraw this amount.
Further, if you have to pay your carpenter more than Rs50,000 and give him a self cheque, the bank will not honor this cheque. Third party withdrawals are capped at Rs50,000. Worse still if you are away from your home branch and are in need of money, you would be able to withdraw only Rs25,000 using a withdrawal form. However, do remember to carry your account passbook along otherwise you will not be able to withdraw your own money!

DOOR STEP BANKING
FOR the old and disabled you can get the bank to come and visit you. In fact, for the common citizen going to a bank in a city is a nightmare! In most banks due to covid restrictions the number of persons allowed inside a bank is limited. Now only the old and infirm are allowed a quarterly free collection of cash

AUTOMATED TELLER MACHINES
THE Automated Teller Machines (ATM) are a lifeline for those in need of cash, especially beyond banking hours or on bank holidays. At first a person could avail of an unlimited use of an ATM to withdraw cash. From January 1, 2022 banks allow their customers four free usages for cash withdrawals. Over and above the monthly free usage, customers will be debited Rs21 each time they use the ATM for a cash withdrawal.
With ATM frauds on the rise, customers are warned to ensure that their PIN is not shared with anyone, neither should one keep the PIN with ATM cards. Banks are now refusing to pay for such frauds, where these occur, when a customer either shares his PIN number or keeps the PIN together with the ATM card, in case the card is stolen!

FEES THAT BANK COLLECTS
ALL banks invariably ask you for your mobile number; although there is no law that requires you to have a mobile connection to open a bank account. Once you give your mobile number, the bank will then use your mobile number to send you messages on the short messaging service (SMS) for which your account will be debited each quarter for charges varying from Rs15 to Rs20. This is one method of extra income that all banks make.
Banks have now equipped their customers with debit cards, while some banks also push their credit cards on to you. But these cards are not free. There is an annual charge for debit cards ranging from Rs200 to Rs350 depending on the kind of card. Don’t try to use the debit card abroad. For you will be paying extra by way of commission every time you swipe the debit card abroad. Then there are graded charges each time you ask for a duplicate bank statement, you generate a PIN, there are charges for demand drafts, NEFT. In short, no bank service is free. All bank services are chargeable, and all this for the luxury of having a bank account.
Customers deposit money by way of a cheque in the bank and likewise make payments to their creditors by writing out a cheque to them. Should there by a case where a cheque is dishonored the poor customer is charged. In some cases, the fault may not be yours but you are debited. In a certain case, a bank that had issued a cheque to a certain person had misspelt his name. When the person had deposited this cheque into his bank account, not only was the cheque returned, but the poor man’s account was debited for Rs20 being cheque returned! Of course, despite the banking customer grievance policy, banks rarely admit their mistakes.
Today for the transfer of money, banks make use of the Electronic Clearing System (ECS). Sometimes these ECS transactions fail since the account may not have the required amount that is to be transacted. Sometimes, the account number is wrong, and at times the name of the beneficiary is misspelt. All banks charge heavily for failed ECS transactions. HDFC charges Rs350 for each rejection in a quarter and the penalty for each subsequent rejection is Rs750.
If we ever thought that banking was free. Think again. In the end the common man is charged for each of the services that the bank gives you. Besides the charges that one pays, the daily harassment of submitting your PAN and Aadhar card, whenever you want to even ask for any service, makes banking a nightmare rather than pleasant experience!