- The Reserve Bank of India (RBI) has announced in a draft circular that banks are required to provide customers with a “basic savings bank deposit” (BSBD) account.
- This account comes with free services and doesn’t require a minimum balance.
- According to the RBI, the ongoing digitization of the banking sector calls for a BSBD account that aligns with the changing needs of customers.
- These guidelines aim to enhance customer service for BSBD account holders and promote greater financial inclusion and digitization.
- The BSBD accounts are part of the Pradhan Mantri Jan Dhan Yojana, allowing individuals without any other bank account to open one at any bank branch or through a business correspondent (Bank Mitra).
The Reserve Bank of India (RBI) has announced in a draft circular that banks are required to provide customers with a “basic savings bank deposit” (BSBD) account. This account comes with free services and doesn’t require a minimum balance.
According to the RBI, the ongoing digitization of the banking sector calls for a BSBD account that aligns with the changing needs of customers. These guidelines aim to enhance customer service for BSBD account holders and promote greater financial inclusion and digitization.
The BSBD accounts are part of the Pradhan Mantri Jan Dhan Yojana, allowing individuals without any other bank account to open one at any bank branch or through a business correspondent (Bank Mitra). So far, over 566 million accounts have been opened, holding deposits totaling ₹2.67 trillion.
In the draft circular, the central bank has urged banks to actively promote the availability and features of BSBD accounts.
The RBI emphasized that banks should clearly explain the differences between BSBD accounts and other types of savings accounts when customers inquire about opening a deposit account.
Customers also have the option to convert their existing savings bank deposit accounts into BSBD accounts.
As per the circular, banks must offer unlimited deposits through cash, electronic channels, and ATMs or cash deposit machines for BSBD accounts. They should also provide free ATM services or debit cards, a yearly cheque book with at least 25 leaves, internet and mobile banking, and a passbook or monthly statement at no additional cost.
Moreover, BSBD account holders are entitled to at least four free withdrawals (including transfers and ATM transactions) each month.
Digital transactions such as Unified Payments Interface, National Electronic Fund Transfer, Real-time Gross Settlement, Immediate Payment Service, and Point of Sale are unlimited.
Additionally, the RBI has indicated that banks may offer extra services, whether free or charged, in a fair and transparent manner, ensuring customers are informed.
In a recent announcement, the RBI clarified that if you have a BSBD account, you won’t be able to open another one at any bank.
So, before you decide to open a BSBD account, the bank will ask you to confirm this with a declaration.
Additionally, if you hold a BSBD account, you won’t be able to open any other savings bank account at the same bank. But don’t worry—you can still open term-deposit accounts if you wish!