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RBI/2004/175
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DBOD.No. Dir. BC. 78/13.03.00/2003-04
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April 22, 2004
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All Scheduled Commercial Banks (excluding RRBs)
Dear Sir,
Committee on Procedures and
Performances Audit on Public Services – Report No. III – Banking
Operations : Deposit Accounts &
Other Facilities relating to Individuals (Non-business)
Please refer to the DO letter dated
April 6, 2004 addressed to you by our Executive Director, Smt. Shyamala Gopinath
on the above subject.
2. The recommendations of the Committee
on Procedures & Performance Audit on Public Services (Chairman, Shri S.
S. Tarapore) with reference to minimum balance in savings bank accounts and
addition / deletion of names of joint account holders have been examined by
us and it has been decided to issue the following clarifications.
- Minimum balance in savings bank accounts
In terms of the paragraph 22
of our Master
Circular No.DBOD.Dir.BC.11/13.03.00/ 2003-04 dated August 14, 2003,
at the time of opening savings bank accounts, banks should inform their customers
about the requirement of maintaining minimum balance and levying of charges
if such minimum balance is not maintained. Any subsequent change in this regard
should be informed to the account holders. The Committee has observed (Sr.No.
6, Appendix III to Summary of Recommendations) that banks are adding charges
without informing the existing depositors. The Committee has recommended that
any charge levied subsequently should be transparently made known to all depositors
in advance with one month’s notice. Accordingly, the banks should inform,
at least one month in advance, the existing account holders any change in
the prescribed minimum balance and the charges that may be levied if the prescribed
minimum balance is not maintained.
- Addition or deletion of the name/s of joint
account holders
In terms of the paragraph 16 of
our Master
Circular No.DBOD.Dir.BC.11/13.03.00/ 2003-04 dated August 14, 2003,
banks have been advised that NRE deposits should be held jointly with non-residents
only. The Committee has observed (Para 8, Annexure I of Summary of Recommendations)
that some of the banks have interpreted that these instructions are equally
applicable to NRO accounts and that NRO accounts can not be held jointly with
residents. It is clarified that Non-Resident Ordinary (NRO) accounts may be
held by non-residents jointly with residents.
3. Please acknowledge receipt.
Yours faithfully,
(Prashant Saran)
Chief General Manager
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