Relief for customers as BB cuts charges on deposits, loans

The central bank yesterday either lowered or eliminated charges on deposits and loans, bringing an end to the excessive fees and commissions that banks used to impose on customers.

In a new development, clients will now be able to  open a savings account with an initial deposit of Tk 500 and a current  account with Tk 1,000.

The central bank's decision came after certain lenders asked their clients to maintain an unusually high amount of money in their accounts. 

Bangladesh Bank also cut some service charges.

For instance, a borrower previously had to count 2 per cent of the outstanding loan amount for an early settlement of a credit.

Now, clients will have to pay a 0.5 per cent charge if they settle early, according to a central bank notice. However, banks  will not be allowed to impose any early settlement fees on the loans  disbursed to cottage, micro, small-and-medium enterprises (CMSMEs).

For  the disbursement of loans up to Tk 50 lakh, lenders can charge a  maximum of 0.5 per cent as a processing fee, which will not exceed Tk 15,000.

If the loan amount is more than Tk 50 lakh, the  processing fee can be 0.3 per cent with the cap set at Tk 20,000.

In addition, banks cannot impose any loan application fees while businesses in the CMSME and farm sectors will be allowed to reschedule their default loans without any charge.

When it comes to rescheduling loans for businesses in other sectors, lenders can charge a maximum of 0.25 per cent, but no more than Tk 10,000, of the outstanding loan.

Banks  earlier imposed loan application and rescheduling fees on their own accord,  creating a burden for clients, according to a central bank official.

Lenders were also directed to provide a balance confirmation certificate, or bank  statement, to clients twice a year free of cost. After that, clients  will have to pay Tk 100 for each statement.

Some banks now charge up to Tk 500-700 for the issuance of such certificates.

Other directives include withdrawing any charge on activating dormant accounts while clients will have to pay a maximum of Tk 200 to collect solvency certificates.

Banks  will not be allowed to charge more than Tk 200 to close saving accounts  and Tk 300 for current accounts. However, these charges will not be  applicable on accounts owned by marginalised people, freedom  fighters, street children, and so on.

Beneficiary owner (BO) account-holders can secure a BO certificate by paying Tk 100.

Clients  will pay a fee of Tk 50 to transfer an account from one branch to  another within the same district but the charge will double if clients  move an account from one district to another.

Banks have also been  banned from imposing any charge in the form of minimum balance fees,  incidental charges, ledger, and counter-charge fees.

The central  bank kept the account maintenance fee unchanged as there will be no  such charge for accounts with a deposit of up to Tk 10,000.