Thursday, June 9, 2011

Abolition of bank service charges a good initiative by SBP

SBP vide BPRD circular no.07 of 2011 issued directives for the commercial banks to stop the process of recovering of service charges from the PLS deposit accounts. SBP vide BPD circular no.23 of July 4, 2003, allowing banks to recover service charges on deposits accounts commensurate with the services provided by them.
Service charges badly affected the savings of small income group. The concept of saving account in the bank was to increase the savings. The purpose of saving account for profit purpose. Amount will be increased with the passage of time. It was quite shocking for common man who has come to know that his account balance is zero after deduction of service charges Rs.50 plus FED every month. The customer urged bad remarks for the banking sector and banker shift all toward policy of Govt regarding service charges in order to normalize the customer. Resultantly, customers advised the banks to immediately close their accounts.
Another headache for the customer, banker demanded account closing charges for closure of account in addition to pain of recovery of service charges. So, in this way long-lasting relationship and trust of the customer had vanished. If we say Service charges prove as a weapon to cut relationship from the bank of small income group will not be wrong.