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Monday, 1 July 2013

SBI to charge customers Rs 60 per year for SMS alerts

SBI to charge customers Rs 60 per year for SMS alerts

State Bank of India (SBI) customers will have to pay Rs 60 per year for getting SMS alerts, a move which is likely to be followed by other public sector lenders.

"With effect from quarter ending June 2013, SMS charges of Rs 15 inclusive of service tax per quarter will be recovered," SBI said in an announcement. The country's largest bank, which has about 18.5 crore customers, did not specify whether the charges are for special alerts only or even debit or credit card transaction alerts sent as per regulatory guidelines will also come under this.

Private sector banks ICICI and HDFC are already charging Rs 60 per year, excluding service tax, for sending special SMSes other than withdrawal and deposit alerts to its customers.

At present, service tax rate is 12 per cent and education cess is 3 per cent of the service tax amount. Kotak Mahindra Bank charges Rs 25 per quarter for SMS alerts and updates.

SBI's fee income during the fourth quarter of 2012-13 declined by 8.13 per cent to Rs 3,873 crore as compared to Rs 4,216 crore in the corresponding quarter. On an annual basis, the fee income fell by 5.02 per cent to Rs 11,484 crore as against Rs 12,091 crore in 2011-12.

Last month, Canara Bank announced a levy of about Rs 112 as annual fee on its ATM debit cards from July 1.

The bank, which currently issues the cards free of cost, said in a circular that a need has been felt to offer the services at competitive rates in tune with "market trends".

"It has been decided to charge a nominal fee of Rs 100 per card plus applicable service taxon completion of one year from the date of issue/renewal of the card and thereafter to be charged yearly," it said.

Several other banks, including SBI, also charge an annual fee in the same range.

Canara Bank further said the annual fee will not apply to debit cards issued to customers with Canara Small Savings Account, Basic Savings Bank Account and Financial Savings Bank Account.

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