Fees for ATM transactions differ across banks and account types.
While banks help you save, borrow, and invest, their services can come at a cost. Any fees a bank levies on its customers are called bank charges.
ADVERTISEMENT
Banks levy fees for Savings Account services such as ATM transactions over a certain limit, account closure, and wire transfers. While these bank charges may appear small at first, they can quickly add up. To get more from your bank, here’s how to avoid these common bank charges.
Although certain bank charges cannot be avoided, you can reduce several of them from your monthly/annual expenditures, such as ATM fees, minimum balance fees, and interest certificate fees. We explore some of the most prominent bank charges and how to avoid them in this article.
ATM fees
Fees for ATM transactions differ across banks and account types. You are generally allowed 5 free monthly transactions (withdrawals) at your bank’s ATM kiosk and 3 to 5 withdrawals at any other bank’s ATM booth. To avoid this bank charge, keep transactions limited to the permitted withdrawals.
To get more from your bank, make sure you choose one with an extensive ATM network so that you can make more free withdrawals. To reduce ATM usage, make card payments where possible and pay bills directly from your account.
Standing instruction fee
Banks offer the convenience of avoiding late payment penalties, but the service isn't free. Most banks charge a flat fee for setting up standing instructions. In addition, there’s a recurring fee each time a transaction is processed, such as EMIs and phone and credit card bill payments.
Account closure fee
Yes, you often have to pay to close a bank account. In India, banks generally allow free account closure within 14 days or after a year of opening the account; closing in between will cost you around Rs 500.
In the absence of specific RBI guidelines, such fees vary from bank to bank. So, if you want to close your account but avoid paying the fee, you’ll need to wait until the next year.
Balance and interest certificate issuance fee
Some banks may charge a fee for providing a certificate confirming a savings account's balance. This certificate may be required for various purposes, such as visa applications, scholarship applications, or loan applications.
Similarly, an interest certificate is a document that shows the amount of interest earned on a savings account over a particular period, typically a financial year. Banks may charge an interest certificate issuance fee to provide this document to their customers.
While these are important certificates to keep, you shouldn’t have to be charged for their issuance. With IDFC FIRST Bank, you can avoid balance and certificate issuance charges through their Zero Fee Banking services on savings accounts.
Cheque bounce fees
Charges for cheque bounce are applied when a cheque bounces.
A cheque can bounce due to any of the following reasons. Hence, it is vital to verify all the details carefully, including:
- Insufficient funds
- Spelling errors
- Mistakes in dates
- Overwriting
- Signature mismatch
- Closed bank account, and
- Mismatch of the amount in words and figures
ATM balance inquiry fee
Non-financial transactions such as balance checking and mini statements are also considered actual ATM transactions liable to bank fees if you exhaust your limit.
However, internet banking does not attract bank charges. Hence, using your mobile banking app or website is an excellent way to avoid ATM balance inquiry fees.
Physical copy of bank statement
A paper statement is a hard copy showing your account activity, including deposits and withdrawals, over a period. These savings account charges are unnecessary, as most banks provide free online statements. To avoid paying these bank charges, check your account online or on the mobile app.
Paper statements may be needed occasionally – to prove to someone that you have paid a bill. Print a hard copy of the online statement to avoid paying these bank charges.
Minimum balance fee
The minimum balance fee is the bank fee charged when your account balance drops below a certain agreed amount/balance. The RBI has no stipulated guidelines regarding this type of bank charge. Therefore, you must closely monitor your expenses to ensure that the minimum balance is maintained in your account.
Stop payment fee
You can make a ‘stop payment’ request to your bank to prevent payment on a personal cheque with the wrong amount or name filled in. The bank fees for this service can vary, so make sure you check the fine print. When writing cheques, be careful to fill in the right amount and name.
SMS alert fee
The SMS alert fee is the bank fee charged to customers for receiving text messages related to transactions or events associated with their savings accounts. The alerts are sent to the customer's registered mobile phone number, providing real-time updates on their account activity.
Some, like IDFC FIRST Bank, offer a Zero Fee Banking service with no charges on for using SMS alerts. You can receive transaction notifications free of cost and stay updated on your account activity.
Conclusion
Consider taking proactive steps to avoid these fees to protect your savings.
If you want to get #MoreFromYourBank, it helps to do your research to find one that provides quality services at the lowest cost possible. Opening a bank account online with IDFC FIRST Bank*, will help you earn more from your savings account with its Zero Fee Banking promise, which offers 28 commonly used savings account services for no charge. In addition, you get attractive interest rates and monthly interest credits.
Do keep in mind some fees are unavoidable, while others can be avoided if you choose the right banking partner and practise financial prudence.
Disclaimer: IDFC FIRST Bank offers Zero Fee Banking on Rs 10,000 Average Monthly Balance (AMB) Savings Account and higher account variants, subject to maintenance of AMB in the account. These services are being offered free in good faith, and in case of abuse, the bank reserves the right to charge fees as per market norms. All rights reserved.
Subscribe today by clicking the link and stay updated with the latest news!" Click here!
