Category Archives: Cheque Collection Policy

Bharatiya Mahila Bank sets foot in Bhubaneswar


It was turn of Bhubaneswar to welcome BMB into its fold. In the first week of June 2014, the first branch in Odisha was inaugurated in Bhubaneswar. A galaxy of women achievers graced the occasion.

The inauguration was done by Dr.Pratibha Satpathy.

The branch is located at: 778, Maharishi College Road, Sahid Nagar, Bhubaneshwar-751007

The Sahid Nagar layout was planned in the late 60’s as an upscale residential area. Over the decades the face of Sahid Nagar has changed from a residential to a commercial area.


Indian inoperative bank accounts not eligible for Penal Charges

One of the conditions a customer signs while opening a bank account is acceptance of penal charges in case minimum balance is not maintained as per the Terms and Conditions of the respective Saving/Current Bank product.

This clause of levying penal charges was applicable to inoperative accounts too.

Q: What are inoperative accounts in the Indian banking context?

Ans: A savings as well as current account should be treated as inoperative / dormant if there are no transactions in the account for over a period of two years.

a)    For the purpose of classifying an account as ‘inoperative’ both the type of transactions i.e., debit as well as credit transactions induced at the instance of customers as well as third party should be considered. However, the service charges levied by the bank or interest credited by the bank should not be considered.

b)   There may be instances where the customer has given a mandate for crediting the interest on Fixed Deposit account to the Savings Bank account and there are no other operations in the Savings Bank account. Since the interest on Fixed Deposit account is credited to the Savings Bank accounts as per the mandate of the customer, the same should be treated as a customer induced transaction. As such, the account should be treated as operative account as long as the interest on Fixed Deposit account is credited to the Savings Bank account. The Savings Bank account can be treated as inoperative account only after two years from the date of the last credit entry of the interest on Fixed Deposit account.

c)    Operation in such accounts may be allowed after due diligence as per risk category of the customer. Due diligence would mean ensuring genuineness of the transaction, verification of the signature and identity etc. However, it has to be ensured that the customer is not inconvenienced as a result of extra care taken by the bank.

d)   Banks should charge any fees for activation of inoperative account.

e)    Interest on savings bank accounts should be credited on regular basis whether the account is operative or not. If a Fixed Deposit Receipt matures and proceeds are unpaid, the amount left unclaimed with the bank will attract savings bank rate of interest.


Reserve Bank of India, vide Notification No: RBI/2013-14/580 DBOD. Dir.BC.No. 109 /13.03.00/2013-14 Dt.May 6, 2014, clarified on levying penal charges on non-maintenance of minimum balances in inoperative Accounts

The reference point is 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.

The other RBI circulars referred here are :

01)Circular DBOD. Dir. BC. 53/ 13.10.00/ 2002-03 dated December 26, 2002 on ‘Minimum Balance in Savings Bank Accounts’ advising banks to inform customers regarding the requirement of minimum balance in savings bank account and levy of penal charges for non-maintenance of the same at the time of opening the account in a transparent manner.

02)Terms of para 3 of our Circular DBOD. No. Leg. BC.35/09.07.005/2012-13 dated August 10, 2012 on ‘Financial Inclusion- Access to Banking Services – Basic Savings Bank Deposit Accounts’ it was advised to banks that no charge should be levied for non-operation/activation of Basic Savings Bank Deposit Accounts (BSBDAs).


Hence, Reserve Bank of India has advised banks henceforth not to levy penal charges for non-maintenance of minimum balances in any inoperative account.

“Instead of levying penal charges for non-maintenance of minimum balance in ordinary savings bank accounts, banks should limit services available on such accounts to those available to basic savings bank deposit accounts and restore the services when the balances improve to the minimum required level,”

Rejoice- No more foreclosure charges/prepayment penalties on Floating Rate Term Loans

In 2012, Reserve Bank Of India, vide Notification No: DBOD. No. Dir.BC.107/13.03.00/2011-12 dated June 5, 2012 , had advised banks not to charge any penalities on foreclosure on floating rate home loans.

However, nothing was mentioned about the other term loans wherein the interest rate was on floating rate.

This anamoly was corrected today vide Reserve Bank of India Notification No: RBI/2013-14/582 DBOD. Dir.BC.No.110/13.03.00/2013-14 dt.May 7, 2014. Reserve Bank of Indis has advised banks not to charge foreclosure charges/prepayment penalties on all floating term loans sanctioned to individual borrowers.

This circular comes to effect, immeidately.

Background:  Part B of the First Bi-monthly Monetary Policy Statement 2014-15 announced on April 1, 2014 proposing certain measures for consumer protection. It was indicated that in the interest of their consumers, banks should consider allowing their borrowers the possibility of prepaying floating rate term loans without any penalty.

Floating Rate Term Loans means the interst charged to the term loans is plus or minus a fixed benchmark. The benchmark rate is fixed every quarterly or half-yearly depening on the respective countrie’s practice

Oops you cannot pay Bangalore Development Authority (BDA) Tax online

On the BDA website, there is a hyperlink guiding BDA tax payers to the online payment page. The only problem is that the link does not open, and the standard operating message is

“Oops! Google Chrome could not connect to

Try reloading: ops.­bdabangalore.­org/­bdaops”

BDA hopes to collect two types of dues:

01)Shop Rental Payment

02)Property Tax Payment

Shop Rental Payments – BDA has commercial properties spread across Bangalore.  IT collects lease rentals or normal rentals from the tenants basing on the agreement between BDA and the tenant.

Property Tax Payment – BDA allots sites to the local residents. The local residents have to pay Property Tax on the vacant sites i.e till a building in constructed on the site.

Bangalore Development Authority came into being with effect from 16th January 1976 under a separate Act of the State Legislature.

Since the last two months the web page interface through which owners have to pay tax for BDA property has crashed and doesn’t load.

Ila Devi, Systems Manager, BDA, said the software had a bug that prevented it from generating receipts for payments made online. And, the payments were also not getting updated to the database.

There is a 24×7 automatic complaint registration no 155302 and aggrieved citizens can call the number to redress their grievance.