Banks play a major role in life of common people, businesses, economy. We see banks as trustworthy organisation where we can get many money related services. But what if I told you that banks today are not seeing you as a customer but as a profit making machine. They are levying heavy charges on your bank accounts and earning hefty amounts through you. Let’s discuss how banks are looting us in today’s scenario!
ICICI Bank, one of the biggest banks in India- has started levying a new convenience fee from 1st November. If you deposit money in the bank’s ATM from 6 pm to 8 am, then a fee would be charged from your account. If you deposit a cumulative sum of more than 10,000 in the entire month in the bank, then too a fee would be charged.
This is going in other banks too. Like Axis Bank is already charging fee for cash deposit transactions during non-banking hours. And if money is withdrawn more than 3 times a month, one needs to pay Rs 150 to the bank.
Hidden Bank Charges
Banks are already charging us with ATM transaction fees, cash transaction fees, debit card fees, credit card fees, duplicate statement fees and money transfer fee. These multiple fees are already known to majority of public.
Minimum Balance fee is also now part of the group. If your bank balance goes lower than monthly limit, then your account will be automatically charged with the fees.
Every year banks earn hefty amounts from these fees. The fact is, from April 2015 to September 2018, banks charged around 10,000 crores as fees from common man’s accounts. And these fee include only minimum balance fee and using ATM more than free limit fee.
Banks has reduced their FD interest rates due to corona as their are less customers and more savings by people in the banks. Now banks have to pay these reduced FD interests whether their are less loan customers. So banks give targets to their relationship managers to sell mutual funds, portfolio management services, pension plans, ULIPs. These all services give banks a lot of commission and banks have no responsibility of returns they earn from them. These are kind of selling third party services to earn commission.
Like Banks sell mutual funds of their own companies to earn commission as a distributor. For Example, Canara Bank mostly sell Canara Robeco Mutual Funds to their customers. And when fund house distributed commission of 92 crores, Canara bank got 35% of that commission as distributors. Same with SBI bank and also private banks are not far away in this game.
Brazen miss selling to senior citizens and others
A bigger danger is posed to those who are not that financially tech savvy especially Senior Citizens, who do not know that much about investing money. They are sold high commission based market linked products. And these products makes bank happy but customer feel unsatisfied and cheated.
Who sells 10 year non liquid policy to a 70 year old senior citizen?! Instead of FD, a 7 year insurance policy with a 5 year wait period!
Need home loan? Yes, take it. But you have to also pay for home loan insurance with it.
Free credit card with 50,000 waived fee. But you still have to pay 18% GST on that 50,000 waived fee. And many other instances happening every second!
The solution is that you will have to become more watchful and will have to read bank statement, read all the terms and conditions, watch over credit card bills. And if you see something fishy- Email immediately. Don’t use phone, Email the problem. Keep a record of your emails!
And consider your relationship manager to be less of a a friend as they are more inclined towards bank. Seek out some relatives or friends who can help you in these matters.
Politicians seeks your ‘Vote’ and Banks seeks your ‘Note’! Be aware and question them both!