Reserve bank of India ruled that no penalty can be imposed on the dormant account by the banks. RBI issued a note dated 27 May 2014 regarding this. Full RBI note is as under.
Please refer to Part B of the First Bi-monthly Monetary Policy Statement 2014-15 announced on April 1, 2014, proposing certain measures towards consumer protection such as non-levy of penal charges for non-maintenance of minimum balance in any inoperative accounts.
2. In this connection, a reference is invited to para 4.4 of our circular RPCD.CO.RRB.BC.No.100/03.05.33/2013-14 dated May 12, 2014 on Customer Service in Regional Rural Banks wherein RRBs were advised to inform customers regarding the requirement of minimum balance in savings bank account and levy of charges for non-maintenance of the same at the time of opening the account in a transparent manner.
3. In terms of para 3 of our circular RPCD.CO.RRB.RCB.BC.No.24/07.38.01/2012-13 dated August 22, 2012 on ‘Financial Inclusion- Access to Banking Services - Basic Savings Bank Deposit Accounts’ RRBs were advised that no charge should be levied for non-operation/activation of Basic Savings Bank Deposit Accounts (BSBDAs).
4. It is advised that, henceforth RRBs are not permitted to levy penal charges for non-maintenance of minimum balances in any inoperative account.