Close your old salary account or it will eat your money
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Your old salary account might eat your money
Have you closed your old salary account with your Bank ?
Your old salary account might eat your money...
It is great to have a salary account especially in a hifi modern bank. They promise you all the heaven. It may be true that with your hifi account you even do not know where your bank is located as you could do everything from the comfort of your home or via phone or ATM. It may be true that someone from the bank came to your company and just only took one signature from you... you even did not have to read or fill that form!
Everything is cool as long as you have the salary coming into your salary account, but what happens when you change your job?
What happens to your salary account when you change your job?
Most people are under the assumption that their old bank account automatically gets closed as it ceases to be the salary account. The truth is that while this may be true to some extent in some banks especially public sector, it is not true for all the banks.
Once you change your job and your salary stops coming to your salary account, then within three to six months (depending upon your bank), maybe even without informing you, you salary account will automatically be converted to a regular savings bank account by many banks. With this comes the requirement for minimum balance. Most people are ignorant about the requirement of minimum balance or assume that when the account is not used at all, it will become a dormant account and it will be closed automatically.
Once your salary account becomes a regular savings bank account then it requires that the person maintain a minimum balance in the account. Sometimes this restriction applies daily, monthly, or quarterly or average for a stipulated period depending on the banks' terms and condition. If a person does not maintain the minimum required balance, some amount will be deducted as fine or service charge.
Six thousand Rupees for an used account... is it possible ?
Some banks keep on charging service charge for non maintenance of minimum balance until you close your bank account even if your account balance reaches zero.
So suppose you do not close your account and let it run say for two years you might incur a service charge of Rs.6000
Rs 750(per quater) * 4(quarters) * 2(years) = Rs 6000/- !!!!
Assuming you had a zero balance, still you might be asked to pay off Rs.6000/- just to close the account, no point arguing you never used it or you were abroad !!!
What a pity there are some banks you keep on charging even if their services are not used or the account is dormant and not used at all. Shame on the unfair banking practice !
Disclaimer: The above article is written based on personal experience and information obtained at the time of writing (December 2009) . You are requested to contact your Bank directly to know the exact methodology and charges. Though this article is believed to be accurate as per the author's knowledge, it is also possible to be incomplete or in accurate or outdated in information. Responsibility and liability for any action you take after reading this article are your own. Please contact your Bank for exact charges that you might incur. Any errors in the above article also may be commented so that they can be corrected.
Do you think there are unfair banking practices in India ?
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HDFC made 3 deductions of 386.05 each for the last three months from my old salary account. The bank didn't inform me about the changes made to the salary account and the minimum balance stipulation, which is Rs. 10,000.
I just noticed the deductions when I happened to visit a new HDFC ATM centre opened opposite my house. I withdrew the rest of the amount and contacted the nearest HDFC branch for closing the account. No extra charges were incurred for the closing process.
Its always better to close your salary account within one month of leaving the job. Maximum you can use zero balance for 3 months never take risk beyond that period otherwise you might have to pay for that.
Very useful article.....Thanks for sharing.
if v r doing transactions every month, salary will remain as salary account or it will change to regular account? plz reply me
HSBC bank in Mauritius is disgusting as well,My mum and dad are retired and unfortunately they were not aware of the minimum limited and they got fined many months without being informed or even being warned. How can these bankers can call themselves professionals, they are thieves, where are their code of conduct, they suppose to be honest and serve the society diligently. They are all thieves and morons.
Very Good Article
Dear Sir
i had a same problem with my axix bank a/c. what i do. There is 3000 Lein Balance in my a/c i dont want to use this account more and also i was not used this account for a long time about one year. I want to close this A/c as soon as possible plz help me out
Shame on the unfair banking practice !
Happened with me too.
dear sir
i had a same problem with my axix bank a/c. what i do my manager says first u pay 27000 than close your a/c plz help me out
Very Useful Informations.... Thank to all for giving good informations.........
Sir, i had 62 Rs. in my a/c. But as i change employer & my salary stops coming in my salary a/c they convert my a/c in sb a/c & now they shoe my lien balance of rs. 691. Now what should i do? i do not wont to use this a/c or to get my 62 rs. SO should i leave it as it is? because if i vil go for closing a.c then they will ask for money.
i had 400 lien balance,what to do now, shall i pay it leave like that
The practice is not unfair. Though the banks must inform customers before converting their salary account to regular saving account and start deducting charges.
One point has been missed out- you will have to pay to close your SALARY A/C even it has not been automatically converted to regular SB Account. Charges varies from Rs 800 to 1500. Means, even if you decide to close your SAL account within a month of changing job/company.
Your SAL account will be converted to Regular if salaries for 3 months are not credited in succession. Then you run into Min balance troubles mentioned above.
Cheers ....Have Fun
This is true. RBS did this with me , my account is overdue for Rs. 6000 , I have filed a complaint in consumer court and also filed an affidavit that I don't want to use this account further.
This article is absolutely correct. I am facing same issue with my old salary account in HDFC and AXIS bank. In combining I have paid more than 8 thousand as lien amount for not maintaining quarterly balance.
yes this is true . the malpractice in banking is not only this but there are thousands of consumer complaints for improper services. acts have to be amended looking to the mass reaction for statments unquoted for entries by the bank, which customers were not informed while opening an account. various charges are posted in the accounts without earier agreed for. there are various complaints for credit card misappropriations.
good information
ABINAYA 46 hours ago
KINDLY INFORM ME WHEN MY SALARY ACCOUNT CHANGE INTO NORMAL SAVINGS ACCOUNT