SBI or State Bank of India offers small account, which is for customers who do not have KYC (Know Your Customer) documents. However, there are many restrictions in operation of the account due to the relaxed KYC norms, according to SBI's website. This type of account is primarily meant for poorer sections of society to encourage them to start saving without any burden of charges or fees, noted SBI. However, upon submission of KYC documents, the account can be converted to regular savings account. Individuals above 18 years of age can open the account singly or jointly.
Here are key things to know about SBI's small savings account:
1. Interest rates: SBI offers the same interest rate on small account as those on regular savings bank accounts. The bank offers an interest rate of 3.5 per cent per annum on deposits less than Rs. 1 lakh.
2. Amount: Customers do not require to maintain an average minimum balance (AMB) in this account. The maximum balance amount that can be maintained in small account is Rs. 50,000. However, if the balance exceeds Rs. 50,000 or total credit in the account exceeds Rs. 1 lakh in a year, no further transaction is permitted until the full KYC procedure is completed, said SBI.
3. Withdrawal and transfer limit: Aggregate of all withdrawals and transfers in a month should not exceed Rs. 10,000, and the aggregate of all credits in a financial year is restricted to Rs. 1 lakh.
4. ATM card: Customers also get a RuPay ATM-cum-debit card free of cost. Credit of money through electronic payment channels like NEFT and RTGS is also free.
5. Other facilities: Small account holders are allowed a maximum of four withdrawals in a month, including ATM withdrawals at own and other bank's ATMs. One doesn't need to pay account closure charges.
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