Tuesday, December 02, 2008

Penalized for not maintaining minimum balance

    236, Desu Colony
    New Delhi – 110046

    The Customer Care Officer
    Montak Shivendra Bank

Sub: A document that explains why Minimum Balance (AQB) was not maintained in my account.

Dear sir/ madam,

My account (A/c No: 090909090909) was opened in Feb 2006 as a Corporate Edge Salary Account when I was an employee of JOSHI EDUCTION PVT. LTD. (Debt Card No: 8693-8976-0956-1866). Opening of this account happened at an inappropriate time during my stint in JOSHI, I should say. In a few weeks since the account was opened, I left JOSHI. I was (un)lucky to receive only a month’s salary (Rs. 8,800/-) in this newly opened account. Unfortunately, this amount, as we all know, was not enough to maintain a bank account.

Life was as hard as ever when all these things took place. At that time I was also a novice in the domain of banking (You won’t believe, when I learned to use the debit card, I considered it one of the greatest achievements in my life.) And thus life went along after my failed career in JOSHI, with long periods of unemployment interspersed with meagerly paid or even unpaid assignments in a few other organizations in the city. Though there has never been enough money in my Montak account (just recently I got the right word for this: AQB – it sounds so stubborn!), Montak ATMs/Partner ATMs came to my rescue when I had urgent cash requirements – meager requirements indeed they were.

Two years eight months down the line, I learn that the bank with whom I had always looked forward to maintaining a long-term relationship has penalized me for reasons I am not fully convinced about. The questions that immediately came to my mind were:

1. As far as I can remember, at no point in time was I informed by the bank that if salary stops being credited to an account, it automatically converts to a Savings Account. And more importantly, that all rules applicable to a Savings Account are applicable to the converted account too. And even today, if you look at the “Profile” of my account in my net banking web page, it’s written “Corporate Edge Salary Account.” (Refer the image below.) Isn’t this information misleading to an account holder? I received a communiqué from the bank in July/Aug 2008 titled “General Schedule of Charges for Savings Account – effective August 1, 2008.” Following this I called up a customer care executive of Montak phone banking (I wish you were able to access our conversation if it’s recorded). The executive assured me that there is no minimum balance requirement for an account opened as Salary Account and to which salary ceased crediting. It sounded logical to me too!

2. In order to maintain minimum balance I need to either submit a cheque at Montak ATM/Branch or do a money transfer online from one of my other accounts. Montak does not have many branches/ATMs in the city. Many a time journey to a branch/ATM cannot be clubbed with my other travel plans within the city. Though I did take pains to deposit a cheque at a branch (for Rs. 13,960/- credited on 10/01/2007), the idea didn’t appear feasible to me. As regards net banking, till recently net banking was all Greek and Latin to me. Nevertheless, I didn’t cherish the idea of withdrawing all amount from my account using the ATM facility, thereby making it a virtually dead account.

3. After updating my mailing address with the bank in March 2006 the next service request I made to the bank is in Sept/Oct 2008. That was for Net & Phone Banking passwords. Several quarters had already elapsed without Minimum Balance in my account. No deduction was done during this period. This, coupled with the reassurance given by the Phone Banking Executive in July/Aug 2008, gave me ample reasons to think that I need not give high priority to reviving this Salary Account of mine. However, as a first step towards getting easy access to my account, I activated Net and Phone Banking facilities (Please note that I have never used this facility anytime in the past.). I also updated my mobile number with the Account. It’s unfortunate that before I could transfer cash from one of my other accounts, Montak chose to take this harsh step: Non-Maintenance Charges of Rs. 750/- were cut in Oct 2008.

Here I would like to have clear answers to the following queries:

1. How can an account holder be penalized for not maintaining minimum balance for an account opened as Salary Account?

2. How would the bank account for the lack of communication (as it was never communicated to me that my account has been converted to Savings Account and all rules apply to this too.) and mis-communication (as has been done by the phone banking executive mentioned earlier)?

3. How logical it is if a bank like Montak Shivendra charges the same amount (Rs. 750/-) as charged by banks with wide network of branches/ATMs like the ICICI or SBI? Non-maintenance of minimum balance, in my opinion has cause-effect relationship with insufficient network of branches/ATMs.

I have transferred an amount of Rs. 25,000 in two installments to my Montak in the last week. I believe in long-term relationships. I request the bank to kindly refund the non-maintenance charges cut from my account, so that we can work out some mutually beneficial investment schemes for the future. Even otherwise it’s all hard-earned money!!

With respectful regards,
    New Delhi,
    16th Nov 2008.