Welcome back, Banking students! In this post, we’ll explore the different types of bank accounts and services available in India. From no-frill accounts to lead bank schemes and business correspondents, there are various options for customers to choose from based on their needs and requirements. We’ll cover the features and benefits of popular account types such as Basic Savings Bank Deposit Accounts (BSBDAs), Pradhan Mantri Jan-Dhan Yojana (PMJDY) accounts, and Small accounts. Additionally, we’ll take a closer look at lead bank schemes and business correspondents and how they help extend banking services to rural areas. So, let’s dive in!
1. No-Frill Account (Nov 2005)
- A zero balance account with no additional facilities.
- In August 2012, all No-Frills accounts were converted to Basic Savings Bank Deposit Accounts (BSBDAs).
2. BSBDA Account
- Offers ATM and debit card facilities at no cost.
- No limit on the number of times for depositing amounts.
- Only four withdrawals per month allowed at branches or ATMs.
- Banks decide the price structure if more facilities are required.
- Follow KYC norms or treat as “BSBDA – Small Account.”
- Customers can have only one BSBDA in one bank.
3. PMJDY Account
- No minimum balance required.
- Interest on deposit.
- Accident insurance cover of Rs. 2,00,000 for account holders.
- Life insurance cover of Rs. 30,000 for account holders (applicable for accounts opened up to 26th Jan 2015).
- Overdraft facility of Rs. 10,000 after six months of satisfactory account operation (preferably for the lady of the household).
- Free Rupay card.
- Age limit: 18 to 65 years.
4. Small Account
- Created when the customer can’t satisfy KYC norms and has several restrictions.
- Aggregate of all deposits shouldn’t exceed Rs. 1 lakh per annum.
- Aggregate of all withdrawals and transfers in a month shouldn’t exceed Rs. 10,000.
- Maximum balance at any point should not exceed Rs. 50,000.
- Initially valid for 12 months, extendable by another 12 months with proof of having applied for an Officially Valid Document (OVD).
5. Lead Bank Scheme
- Introduced after the nationalization of 14 banks in 1969 to extend banking reach to rural areas.
- “Area” approach recommended by the National Credit Council study group headed by Prof. D.R. Gadgil.
- Adopted by the Committee of Bankers (Nariman Committee) and named “Lead Bank Scheme.”
- Initially, 380 districts were identified, later extended to all rural districts.
6. Business Correspondents
- Retail agents engaged by banks to provide banking services at non-branch locations.
- Handle receipt and delivery of small value remittances and other payment instruments.
- Responsible for disbursing small loans like entrepreneurial loans, agricultural loans, group loans, etc., based on partner banks’ guidelines.
That’s it for today, folks! Now you know more about the different types of bank accounts and services in India. Keep studying and stay tuned to the Pareeksha for more educational content!