Hidden Bank Charges and ways to avoid them.
Banks have been notorious to charge their customers without their knowledge. The facilities that you use and often praise come with a rider that is unknown to you. The cumulative cost of all the service charges that the bank applies from issue of cheque books to ATM charges could amount significantly and affect your balances. A very good friend of mine, who is a Banker with a reputed Government Undertaking Bank, informed me about the traps that they lay and how to safeguard my money. I am sharing the same inputs. Become an informed customer and care for the small transaction fees that Banks charge.
1) Do maintain Average Monthly Balances.Banks in India ask their account holders to maintain a minimum balance. Overdrawing money beyond this limit amounts to penalty up to Rs. 250 per month. For best, open an account that does not mandate to maintain the minimum balance criteria. 2) Visit Charges.In case you do not use ATM, and withdraw using cheque or withdrawal slips, STOP. Start counting your number of visits to the Bank every month. Banks charge a service fee for every visit beyond a specified limit. Be informed and ask your banker the limit of number of visit. No Bank will disclose this information unless you become conscious and ask it for yourself. If the number of cash deposits and withdrawals from a branch is high, then the bank charges a cost for using services of additional staff (like cashier), tackling fake currency and paying for extra security. You can avoid paying this extra cost by limiting your visits to a bank. Use ATM for cash withdrawal For deposits and cheque payments, make use of direct fund transfers via online banking.
3) ATM charges
Apart from first five transactions, other Bank ATM's are chargable. Beyond that, the charges for withdrawal or a transaction are maximum of Rs. 20/-. As far as possible, use your own bank ATM. Try getting an account opened in Banks that have a good ATM network. This will help you track down ATMs Quicker and within comfortable reach. nsactions at other bank ATMs are free.
Money transfer via internet comes with a price between Rs. 5 and Rs. 25 per transaction. Using a cheque is more economic.
4) Issue of Cheque books/ Replacement of Lost ATM cards/ Telephone Banking/ Net Banking/ SMS Alerts/ Printed Bank records
All are without any doubt cchargeable Go to your bank and inquire the prescribed charges for each. In case you are not using any of the services, kindly apply to cancel the service and save your money.
STOP PAYMENTS also have their own share of pinching on the customers pockets. Be careful while issuing cheques and avoid stop payments.
Banks have a limit for issuing cheques and new booklets beyond that come at cost of Rs.2 per cheque.
5) Cheque transaction charges
In case a cheque bounces, and is returned, check your passbook records for the charges the bank has applied. Also ask for the At par cheques, which are used for making payment in other cities. Such transactions require addition cost of clearing, which is again borne by the issuer of the cheque.
6) Shopping online
Shopping online comes with a hidden banking charge. Banks earn from your transactions, and give back a few to you as reward points. This makes banks happy, and gives you a false feeling of getting a bigger piece of cake.
Monitor these costs. Be an informed customer.
