NEWS
RBI extends free digital banking service to ‘No-frills’ account holders
RBI Governor Sanjay Malhotra said bouquet of services offered to basic savings bank deposit account holders is proposed to be expanded to include digital banking services.
RBI Governor Sanjay Malhotra said bouquet of services offered to basic savings bank deposit account holders is proposed to be expanded to include digital banking services.
The Reserve Bank of India (RBI) has said that basic savings bank deposit (BSBD) account holders can enjoy digital banking services free of cost.
Such account holders get free of cost essential banking services such as cash deposit at bank branches, ATMs/CDMs and a minimum of four withdrawals (including ATM withdrawals) in a month. Now the RBI proposes to add to the bouquet digital banking services.
"The bouquet of services offered to basic savings bank deposit account holders without levy of minimum balance charges is proposed to be expanded to include digital banking (mobile/internet banking) services," RBI Governor Sanjay Malhotra said.
How does the RBI define a basic savings bank deposit account? All the existing ‘No-frills’ accounts opened pursuant to guidelines issued and converted into BSBD account in compliance with the guidelines issued in as well as fresh accounts opened under the said circular should be treated as BSBD account, the RBI states.
The holder of a basic savings bank deposit account will not be eligible to open any other savings bank account in the same bank. If a customer has any other existing savings bank account in the same bank, he/she will be required to close it within 30 days from the date of opening a basic savings bank deposit account.
The aim of introducing such an account is a part of the efforts of the RBI for furthering financial inclusion objectives.
Such accounts are subject to provisions of the PML Act and Rules and RBI instructions on Know Your Customer (KYC) / Anti-Money Laundering (AML) for opening of bank accounts issued from time to time.
The BSBD account can also be opened with simplified KYC norms.
“The ongoing digitalisation in the banking sector necessitates a BSBD account that is in sync with the customer’s changing requirements. Therefore, it has been decided to review the extant instructions on BSBD accounts to provide affordable banking facilities to the public and drive enhanced usage of BSBD accounts to deepen financial inclusion,” the RBI said on Wednesday.
