Monday, September 18, 2017

State Bank of India now Reviewing Minimum Balance Charges in S/B Accounts

State Bank of India is reviewing the feedback received from customers on the issue of penalty charges for certain categories of accounts for non- maintenance of monthly average balance

Mumbai, September 17 (PTI): State Bank of India (SBI) said it is reviewing charges for certain categories of accounts for non- maintenance of monthly average balance (MAB) after receiving feedback from customers.

In April this year, the country’s largest lender reintroduced charges on non-maintenance of monthly average balance (MAB) after a gap of five years.

“We have received feedback from our customers on the issue and we are reviewing those. The bank will take into account those and make an informed decision,” the banks managing director (national banking group) Rajnish Kumar told PTI.

“We will internally debate whether any moderation for certain categories of customers like senior citizens and students needs to be done anywhere. The charges are never cast in iron.”

As per the list of revised charges of SBI, failure to maintain monthly average balance in accounts will attract penalty of up to Rs100 plus goods and services tax (GST).

In metropolitan areas, there will be a charge of Rs100 plus GST, if the balance falls below 75% of the MAB of Rs5,000. If the shortfall is 50% or less of the MAB, then the bank will charge Rs 50 plus GST. In rural areas, the monthly average balance requirement has been kept at Rs1,000.

Any shortfall in maintaining minimum balance in rural areas can attract penalty in the range of Rs20 to Rs50 plus GST.

Kumar said the bank has over 40 crore savings bank accounts, which includes 13 crore of Basic Savings Bank Deposit (BSBD) and Pradhan Mantri Jan-Dhan Yojana (PMJDY) accounts. The bank has exempted BSBD and PMJDY accounts from maintaining the minimum balance requirement.

Out of the 27 crore normal savings bank accounts, nearly 15-20 per cent are those where customers are not maintaining monthly average balance. The bank in April had given notices to all those account holders who did not have monthly average balance and asked them to keep the minimum balance in May.

“When they did not maintained the monthly average balance in May then we recovered in June. We had recovered Rs235 crore from such account holders as penalty,” Kumar said.

He said there is huge cost in maintaining the savings accounts and banks should be allowed to recover some costs.

“There are lots of operational costs. We also have to invest huge amount of money in technology. There are some costs which I think bank should recover,” Kumar said, adding the charges which SBI is levying for non-maintenance of minimum balance is very competitive as compared to other lenders.

He said a normal savings account holder has an option to convert his account into BSBD account which will exempt him from maintaining monthly average balance.

Wednesday, September 13, 2017

SBI Card to debut contactless payments

Mumbai, September 11:  SBI Card customers could soon make payments by merely tapping their smartphone on a swipe machine. SBI Card is updating its mobile application to enable customers make contactless payments at point of sales (PoS) terminals using a technology called Host Card Emulation (HCE) which enables dematerialisation of the card.

Cardholders of the bank already use smartphones as an alternative for cards on the Samsung Pay platform and the bank will next month launch its proprietary application which enables virtualisation of the card in a smartphone using near-field communication (NFC). "Among our recent innovations we have enabled our card for Bharat QR code by incorporating the feature in our app," said Vijay Jasuja, CEO, SBI Cards.

SBI Cards, which recently entered into an agreement for partner GE to exit the venture, is looking to double its base from 50 lakhs in two years. The company, which is the second-largest issuer in India, has a renewed focus on SBI customers through pre-approved cards.

SBI Card has doubled its base in three years to over 50 lakhs and is recording fastest growth in issuance with 15% market share of cards in force (CIF) as well as card spends. "Before demonetisation the card volume growth rate was around 60,000 cards per month which increased to over 1 lakh cards per month post-demonetisation period and has now grown to around 2 lakh cards per month," said Jasuja.

At present, 15-20% of cards come from co-branded partnerships like Big Bazaar and Tata. State Bank of India customers account for 35% of cards. Bulk of the customers (45%) are from the open market. "While going after the whole lot does not make sense considering that the bank has a 50-crore customer base and we do not have the capacity for that, we will be picking them up in lots," he said.

Jasuja said that the company would invest in boosting infrastructure and working with partners. The company has recently identified top 100-200 institutions in the country where students in their final year of graduation, who are not yet employed, will be eligible for a credit card. Over the last one year the monthly card spend has grown from an average of Rs 3,500 crore per month to Rs 5,500-crore plus per month.

Thursday, September 7, 2017

Say hello to Sia, SBI's intelligent chat assistant who will answer your queries

Mumbai, September 5:  India's largest public sector lender State Bank of India (SBI) has come up with its own Artificial Intelligence-powered chatbot who will take care of customer queries by giving out information on SBI's range of products and services.

Sia, which is currently undergoing beta testing, said it is 'still learning' when asked a few questions. Please verify the information provided from other sources, it said.

Sia is designed to answer customer questions regarding home loans, education loans, car loans, personal loans, recurring deposit, term deposit, etc.

According to a NDTV Profit report, SBI had said that its new digital platforms like SBI inTouch are widely using bots and artificial intelligence such as IBM Watson, to perform a variety of jobs, especially in improving customer experience.

More than 80 per cent of the SBI's transactions are done in non-branch journeys, i.e. not touched by any SBI employee - only through machines, it said.

Aadhaar seeding scam takes root

Ranchi, Jharkhand, September 1: Rohit Kumar Pandit (22), BTech student of a private engineering college in Ranchi, and Om Prakash Singh, with the help of a banking agent (banking correspondent) of UBI's Jhumri Telaiya branch in Koderma in Jharkhand, linked his Aadhaar number with the savings account of a college to embezzle more than Rs 11.33 lakh in 30 days, exposing a serious threat to the unique ID seeding that the Narendra Modi government at the Centre is so aggressively promoting.

Wednesday, September 6, 2017

Mis-selling of insurance products by the banks are on the rise

Kolkata, September 4:  Septuagenarian Anusua Basu wanted to make a one-time investment of Rs. 1.5 lakh in an equity-linked savings scheme (ELSS) for tax gain. She paid the amount and was ready to wait for the three-year lock-in period to get over to earn her returns.

She was, however, in for a shock when her account was debited for Rs. 1.5 lakh the second year as well.

On receiving the premium renewal notice the second year, she realised that her bank had sold her a ULIP instead. When she went to the bank looking for the relationship manager who sold her the policy, she was informed that the person concerned had moved out.

Anusua is not alone. Instances of mis-selling of insurance products through bank branches are on the rise. Customers easily give in to the aggressive marketing techniques of some bank employees primarily on account of the trust reposed on the bank they have been banking with. Though there is no official data on the number of policies mis-sold, calls made to banking and insurance ombudsman offices in Mumbai, Kolkata, Chennai and Ahmedabad confirm there is a rise in complaints from people on mis-selling by banks.

Mis-selling refers to certain ‘unfair business practices’, including wrong sale of product, loading on products and promise of higher returns. “The number of complaints from people about mis-selling by bank branches has increased. However, a complaint may not necessarily mean that the product was always mis-sold,” a banking ombudsman officer from Mumbai told BusinessLine on condition of anonymity.

Mis-selling expected to rise:

According to industry experts, instances of mis-selling are expected to rise in future with banks and insurance companies going aggressive on the bancassurance channel, more so under the open architecture model, unless attention is paid to developing simpler products and equipping bank employees with adequate knowledge and infrastructure.

Under open architecture, a bank can have tie-ups with up to three insurers — in each of life, non-life and health segments.

“Mis-selling is prevalent in almost all kinds of channels, but the open architecture model will throw up more challenges,” said P Nandagopal, Founder and CEO, Insurance Inbox.

Aggressive push:

With the Insurance Regulatory and Development Authority of India (IRDAI) issuing guidelines on open architecture in 2015, banks and insurance companies have been looking at this segment aggressively to scale up their business.

While on the banks’ part it is a way to earn fee-based income, for an insurance company this would mean better penetration across the country, including the rural markets.

Need for simpler products:

Friday, September 1, 2017

SBI launches chatbot to assist customers

State Bank of India has enabled a chatbot to field queries
on the bank's retail products from visitors to its website

Mumbai, September 1: State Bank of India (SBI) has enabled a chatbot to field queries on the bank’s retail products from visitors to its website. Named SBI Intelligent Assistant (SIA), the bot responds to customer inquiries on home loans, education loans, car loans, personal loans, recurring deposits and term deposits. Chatbots are digital robots that can carry on a conversation through audio or text. Mrutyunjay Mahapatra, deputy MD and chief information officer at SBI, told FE that the decision to introduce a chatbot was taken as it was felt that navigating the website could be a bit of a task for a customer.

“Most of the time, customer touch-points with the bank are for three things — sales, service and enquiry,” Mahapatra said, adding, “We found that for enquiry and navigation, a customer has to navigate quite a bit or go to call centres, where the agent may not be fully knowledgeable.” The chatbot was developed by Allincall, a start-up backed by IIT Bombay, and uses machine learning and bot experience to respond to customer queries.