According to para 5.4 of the master circular, "at the time of opening the accounts, banks should inform their customers in a transparent manner the requirement of maintaining minimum balance and levying of charges, etc., if the minimum balance is not maintained. Any charge levied subsequently should be transparently made known to all depositors in advance with one month’s notice. The banks should inform, at least one month in advance, the existing account holders of any change in the prescribed minimum balance and the charges that may be levied if the prescribed minimum balance is not maintained". Reserve Bank of India is, however, silent on the manner in which banks should inform customers. For example, a bank may update the policy of minimum balance requirement on their website or may just post a letter on the notice board in a branch instead of informing customers individually. You are welcome to express your opinion on this aspect in the comments form below.
Basic Banking No-frills Account
As per para 4.1 of the master circular, to promote financial inclusion in the country, all banks should make available a basic banking 'no-frills' account either with 'nil' or very low minimum balance as well as charges that would make such accounts accessible to vast sections of population. The nature and number of transactions in such accounts could be restricted, but made known to the customer in advance in a transparent manner. All banks should also give wide publicity to the facility of such a 'no-frills' account including on their web sites indicating the facilities and charges in a transparent manner.