Union Finance Minister Nirmala Sitharaman stated that the minimum balance requirements do not apply to PM Jan Dhan accounts or basic savings accounts. In her response to a question in the Rajya Sabha, Sitharaman explained that these rules are relevant only to accounts that necessitate maintaining a specified minimum balance.

This clarification comes amidst recent reports showing that public sector banks have levied significant fines for failing to maintain minimum balance. Over the last five years, these penalties have totaled Rs 8,500 crore. The banks imposing these charges include major names like Punjab National Bank, Bank of Baroda, Bank of India, Punjab and Sind Bank, Union Bank of India, UCO Bank, Indian Bank, Canara Bank, Bank of Maharashtra, and Central Bank of India.

Minister of State for Finance Pankaj Chaudhary had disclosed last month in the Lok Sabha that public sector banks collected Rs 2,331 crore in penalties for the fiscal year 2023-24, reflecting a 25 percent increase from the previous year. Punjab National Bank, Bank of Baroda, and Indian Bank were the top contributors, with fines of Rs 633 crore, Rs 386 crore, and Rs 369 crore respectively.

Sitharaman’s comments aim to clarify the applicability of minimum balance rules to different types of bank accounts.