IDBI ASKING 35K FOR ACCOUNT CLOSURE

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Deal Cadet
aniket1587

My friend has 2 current accounts in IDBI bank, both accounts r now dormant, he went to branch to close the accounts but the manager said he needs to pay minimum average balance charges Rs 35000 before closing the accounts.

is there any solution to this?? can anyone suggest a way to waive off these non-maintaince charges?? does RBI allows banks to collect such huge amount in the name of MAB charges??

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Deal Lieutenant Deal Lieutenant
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I think someone has mentioned in DD if you just ignore those dormant accounts it will just autoclose in 10 years i think…
not sure though..

Edit: I was assuming it was savings account.
For current account I have no idea.
Thanks @teriab33 for pointing this.
smile

Post Tycoon Post Tycoon
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As per RBI, MAB Charges can be levied upto available balance only. Your balance cannot be negetive

Entertainer Entertainer
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Dormant accounts are the bank fraudster employees’ (managers) treasure chest to hide their scams. They discourage customers from closing old dormant account by levying heavy charges, giving reasons photo/signature/name mismatch and account not found in updated database. Bring this and that.

Deal Cadet Deal Cadet
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My dormant account was closed by Kotak Mahindra bank without any charges. I don’t think anything would happen if you leave it alone.

Deal Lieutenant Deal Lieutenant
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aniket1587 wrote:

@DealFinder @shreyu2105 i have read somewhere that the banks will report this balance to CIBIL

What CIBIL is going to ‘compute’ with the dormant accounts..
Account becomes dormant due to ineffectiveness of bank managers..
It is the banks’ responsibility not customers!!.. stuck_out_tongue

Deal Subedar Deal Subedar
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DealFinder wrote:

What CIBIL is going to ‘compute’ with the dormant accounts..
Account becomes dormant due to ineffectiveness of bank managers..
It is the banks’ responsibility not customers!!.. stuck_out_tongue

The problem is, common logic does not work with CIBIL score.

Most Current accounts come with an overdraft facility, so the maintenance charges for the current account gets debited even if the cash balance is zero, and the account now runs into using the overdraft limits allotted to these current accounts by default..

This utilized overdraft is an unsecured credit facility and can be reported to CIBIL as an unsecured loan default.

I think the 35k round figure, op mentioned is the extend of overdraft facility that came with the current account and now fully utilized.

There is a lesson here for everybody, financial institutions in the west, like paypal, providers of crypto currency wallets, have started charging for dormant accounts. They charge you a monthly fee for not using the accounts.This will be soon followed by the financial service providers in our country to generate recurring revenue. And all those accounts that someone has opened and not using will sooner or later become a liability. So open financial service related accounts only if you need it.

https://fortune.com/2020/03/13/paypal-credit-sc...

Deal Subedar Deal Subedar
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They will send court notices , failure to attend to notice will end up in complications .

Deal Cadet Deal Cadet
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teriab33 wrote:

The problem is, common logic does not work with CIBIL score.

Most Current accounts come with an overdraft facility, so the maintenance charges for the current account gets debited even if the cash balance is zero, and the account now runs into using the overdraft limits.

This utilized overdraft is an unsecured credit facility and can be reported to CIBIL as an unsecured loan default.

I think the 35k round figure, op mentioned is the extend of overdraft facility that came with the current account and now fully utilized.

There is a lesson here for everybody, financial institutions in the west, like paypal, providers of crypto currency wallets, have started charging for dormant accounts. They charge you a monthly fee for not using the accounts.This will be soon followed by the financial service providers in our country to generate recurring revenue. And all those accounts that someone has opened and not using will sooner or later become a liability. So open financial service related accounts only if you need it.

they have charged Rs 885 per month as MAB charges, u mean to say this 35000 will be reported to CIBIL??

Deal Subedar Deal Subedar
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saymyname78 wrote:

They will send court notices , failure to attend to notice will end up in complications .

Don’t accept the notice.

Deal Subedar Deal Subedar
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aniket1587 wrote:

they have charged Rs 885 per month as MAB charges, u mean to say this 35000 will be reported to CIBIL??

If these charges have already been debited against the overdraft limits on the current account, it will eventually turn into an unsecured loan default. Banks have to report unsecured credit defaults , just like credit card defaults. Maybe it has already been updated to CIBIL.

Deal Lieutenant Deal Lieutenant
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teriab33 wrote:

The problem is, common logic does not work with CIBIL score.

Most Current accounts come with an overdraft facility, so the maintenance charges for the current account gets debited even if the cash balance is zero, and the account now runs into using the overdraft limits allotted to these current accounts by default..

This utilized overdraft is an unsecured credit facility and can be reported to CIBIL as an unsecured loan default.

I think the 35k round figure, op mentioned is the extend of overdraft facility that came with the current account and now fully utilized.

There is a lesson here for everybody, financial institutions in the west, like paypal, providers of crypto currency wallets, have started charging for dormant accounts. They charge you a monthly fee for not using the accounts.This will be soon followed by the financial service providers in our country to generate recurring revenue. And all those accounts that someone has opened and not using will sooner or later become a liability. So open financial service related accounts only if you need it.

I was discussing only about savings accounts.
No idea on current accounts.

Deal Cadet Deal Cadet
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teriab33 wrote:

If these charges have already been debited against the overdraft limits on the current account, it will eventually turn into an unsecured loan default. Banks have to report unsecured credit defaults , just like credit card defaults. Maybe it has already been updated to CIBIL.

thanks for the info, will write to the nodal officer for some waiver

Deal Captain Deal Captain
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teriab33 wrote:

If these charges have already been debited against the overdraft limits on the current account, it will eventually turn into an unsecured loan default. Banks have to report unsecured credit defaults , just like credit card defaults. Maybe it has already been updated to CIBIL.

flushed

Are you a banker or something?

Hunk Hunk
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aniket1587 wrote:

@DealFinder @shreyu2105 i have read somewhere that the banks will report this balance to CIBIL

OK… If the amount has been drawn from overdraft limit then u’re liable to pay the balance.

Critic Critic
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Ask them to give the demand for 35k in writing from their official email quoting the relevant bank policy/clause for demanding such amount & keep bank’s nodal office/grievance office in cc.

Deal Captain Deal Captain
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saucap wrote:

Dormant accounts are the bank fraudster employees’ (managers) treasure chest to hide their scams. They discourage customers from closing old dormant account by levying heavy charges, giving reasons photo/signature/name mismatch and account not found in updated database. Bring this and that.

Saucap sunglasses smiling_imp

Deal Cadet Deal Cadet
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ZNZ wrote:

OK… If the amount has been drawn from overdraft limit then u’re liable to pay the balance.

@ZNZ amount is not withdrawn from OD facility, they have charged Rs 885 monthly for non mainantance of balance,
2 current accounts, Rs 885 monthly for 2 years plus taxes

@guest_999 they have given printout of the charges

Deal Subedar Deal Subedar
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aniket1587 wrote:

@ZNZ amount is not withdrawn from OD facility, they have charged Rs 885 monthly for non mainantance of balance,
2 current accounts, Rs 885 monthly for 2 years plus taxes

@guest_999 they have given printout of the charges

U were suppose to receive no min balance maintainance message from bank and each month fine, otherwise how can a customet knows bank fine policy.

If u have receive such message and ignored then its ur fault or if Bank doesnt send such message u have right to pay nothing and kindly go to banking obdusman if bank ppl doesnt listen.

Hunk Hunk
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aniket1587 wrote:

@ZNZ amount is not withdrawn from OD facility, they have charged Rs 885 monthly for non mainantance of balance,
2 accounts, Rs 885 monthly for 2 years plus taxes

@guest_999 they have given printout of the charges

OK. Then forget about that amount (maybe).
You can bait the branch manager of using that account again. Most probably he’ll waive off the charges then just close the account.

Cause it’s a current account there’s a slight chance it can affect you in future.
If it was a normal savings account I would have recommended to forget about it.

Deal Cadet Deal Cadet
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ZNZ wrote:

OK. Then forget about that amount (maybe).
You can bait the branch manager of using that account again. Most probably he’ll waive off the charges then just close the account.

Cause it’s a current account there’s a slight chance it can affect you in future.
If it was a normal savings account I would have recommended to forget about it.

thanks for the suggestion, will try to bait the manager for sure

Critic Critic
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aniket1587 wrote:

thanks for the suggestion, will try to bait the manager for sure

Also “gently” mention going to banking ombudsman/rbi for clarification of rules regarding this for future reference.

Deal Cadet Deal Cadet
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aniket1587 wrote:

thanks for the info, will write to the nodal officer for some waiver

You mean “your friend” will contact nodal officer. 😄

Also if ₹885 fine is per account then,

885×24=21240 + 18% GST=25063

Total for 2 accounts=50126

So it should be either 25K or 50K. How come it’s 35K?

Missing