To access the banking system through various platforms/processes, banks provide different kind of services to depositors. Bank charge is a fee that banks charge depositors to access these banking services. Recently, banks have started charging depositors for each and every transaction done by them including those that were previously free of charge. Account holders have to pay to avail the services provided by the banks. For eg: To deposit or withdraw cash from bank branches, account holders have to pay an amount ranging from Rs 10 to Rs 200 or more. ATM services are also no longer provided free by banks. All the services through ATMs are being charged.
In the recent budget session of the parliament, the government a shared detailed list of bank charges and chargeable and free components of the services.
Who all are affected by bank charges?
EVERYONE, with a bank account. But the most affected are the poor, middle class and working-class people.
How bank charges are targeting the poor and benefitting the rich?
Banks providing free services to rich people and charging the poor for every service they use. This differential treatment is being done on the basis of the balance in bank accounts. If the balance in the account is higher than a certain amount (Rs25,000 and above, varies from bank to bank), account holders are given privileges of FREE services and NO charges.
But the majority of bank customers belong to middle and low-income households with monthly income even less than 25,000. It would be impossible for people to maintain huge sums of money as minimum balance, given their financial commitments. To fine for not having a minimum balance, is effectively punishing people for being poor.
Similarly, banks are charging people for using bank branches(after a certain number of deposit and withdrawals). This will particularly affect old people, pensioners and those who do not have any knowledge of or access to technology. It would also affect the rural and semi-urban people, where infrastructure for internet connection is less.