RBI said the changes are aimed at providing affordable banking facilities to the public, to encourage better utilization of BSBD accounts and also in the interest of better customer service to BSBD account holders.
Savings Bank (SB) account holders may consider converting any of their accounts into Basic Savings Bank Deposit (BSBD) accounts as the RBI has told banks that those holding the latter should not be charged any issuance and annual renewal charges on their ATM card or ATM-cum-debit card and a mobile banking and internet banking facility should be provided.
The above clauses are included in the Reserve Bank of India (Commercial Banks – Responsible Business Conduct) Amendment Directions, 2025, relating to BSBD accounts.
BSBD focus
RBI said the changes are aimed at providing affordable banking facilities to the public, to encourage better utilization of BSBD accounts and also in the interest of better customer service to BSBD account holders. The Amendment Guidelines will come into effect from April 1, 2026 or on the date of adoption by the bank, whichever is earlier.
The central bank said a customer can convert his/her existing savings account to a BSBD account. The bank will convert the existing savings bank account into a BSBD account within seven days of receiving the customer’s written request for such conversion. Such an option is also offered to customers through digital channels.
The holder of a BSBD account is not eligible to open another BSBD account in the same bank or in any other bank.
BSBD accounts started off about two decades ago as ‘non-frills’ accounts, with RBI asking banks to offer them with ‘zero’ or very low minimum balances, as well as charges that would make them accessible to large sections of the population.
The ‘no-nonsense’ nomenclature was abolished in 2012 to remove the stigma associated with it. The RBI then asked the banks to offer a “Basic Savings Bank Deposit (BSBD) Account” as a savings bank account that provides certain minimum facilities free of charge to the holders of such accounts with the aim of deepening financial inclusion.
One of the important changes introduced by RBI in the Directions includes the requirement that banks should offer an ATM card or an ATM-cum-debit card to their customers without charging for the annual fee either at the time of issuance or renewal.
Currently, SB account holders are charged an annual fee of around ₹200 to ₹400 by the banks.
Further, the banks will offer BSBDA customers internet and mobile banking (this was not available to them so far) and check books with a minimum of 25 check leaves per year.
Transaction limits
The Directions allow BSBD account holders a minimum of four free withdrawals, including wire transfers and ATM transactions (conducted at the bank’s own ATM or at another bank’s ATM), per month. Digital payment transactions other than ATM transactions, – Point of Sale transfers, NEFT, RTGS, UPI, IMPS, etc. will not be counted as withdrawals for this purpose.
Charges for digital payment transactions are in accordance with the guidelines of the Department of Payment and Settlement Systems, Reserve Bank/National Payments Corporation of India/Government of India, as applicable.
The existing guidelines allow a minimum of four withdrawals per month, including ATM withdrawals.
Banking expert V Viswanathan said, “Apart from the restriction on free withdrawals made through bank counters by cash/transfer and through cash in ATMs and free check books limited to 25 sheets per year, there are virtually no other restrictions.
“All digital payments other than ATM transactions will not count towards withdrawals. A customer’s passbook/statement, whether in print or email, is also free if there is a charge.”
He opined that any existing SB account holder would be willing to convert one of his operating accounts into a BSBD account and conduct all his transactions through this account.
“This is a very good move that will do a lot of good for the common man who runs a normal SB account,” Viswanathan said.
Provisions regarding the deposit of cash; receipt of money through any electronic channel or deposit/cashing of checks; and there remains no limit on the number and value of deposits that can be made in a month as of the 2019 circular.
At the end of FY24, the banking system had 70.59 crore BSBD accounts, with an outstanding amount of ₹2,99,795 crore, according to RBI data. All scheduled commercial banks had SB deposits worth a total of ₹63,41,043 crore at the end of FY24.
Published on December 4, 2025
#Revised #BSBD #Standards #Providing #digital #banking #charges #ATM #card