A banking journey starts with opening a savings account. This is your first interaction with the financial system. With it, you can track your income and expenses. Apart from services such as online banking, ATMs, debit cards, checkbooks, etc., you can also park your money safely and earn interest in a savings account.
When opening a savings account for the first time, in addition to learning about the interest rate, minimum balance, and FD rates, it’s a good idea to learn about lesser-known fees. Several services and fees are linked to your savings account; not knowing them can cost you dearly. Here’s how you can track these fees.
Read the terms and conditions
When opening a savings account, the bank provides a list of fees and conditions. It contains all the fees you may have to pay to take advantage of the bank’s different types of services. You should read these terms and conditions carefully. You already know the different services that you will frequently use and their fees when operating your bank account. For example, you may frequently use services such as NEFT and IMPS for money transfers, debit cards, etc. You should check their fees before opening a savings account.
Check your bank statement regularly
People often skip checking their bank statements regularly, but it’s not a good idea. The bank statement gives you transaction details for a month, a quarter and a year. This is why you should always read your bank statement carefully and report any discrepancies to the relevant bank.
Plus, all charges are recorded on the bank statement, so it’s easy for you to know what you’re being charged. If there are any unspecified charges, you can easily find them on your bank statement. It would help if you got into the habit of checking your account statement regularly, at least once a month. You can easily access the account statement via online banking or mobile banking app.
List of banking services and fees
Banks charge you for services. Fees may vary from bank to bank. For example, there may be charges for a cash deposit or withdrawal beyond the free limits offered by any bank. There may also be fees for using non-bank ATMs or for not maintaining the minimum average balance required by your bank.
Savings accounts require you to maintain a minimum balance, and the amount may differ from bank to bank. Salary accounts are zero balance accounts, but you must meet a minimum balance requirement to avoid paying fees to the bank for other types of accounts. Some banks require the maintenance of a monthly average balance (MAB), others a quarterly average balance (QAB) and others require a minimum balance (MB) to avoid penalties. Before opening a savings account, you should check the minimum balance required. Your savings account may incur check book fees, online money transfer fees (on IMPS, RTGS, NEFT, etc.), check bounce fees, bank statement fees, SMS alert, etc. If you plan to travel abroad and get domestic currency converted into foreign currency by the bank, there will be currency conversion charges. If you use a debit card to make a payment in a foreign country, the bank may charge you a foreign transaction fee. If you use the debit card to withdraw money in a foreign country, the bank may charge you a withdrawal fee at foreign ATMs.
Stay up to date with the latest banking announcements
During a period, the charges on your savings account may change. Generally, banks keep you informed by sending you an SMS or e-mails. However, it would be best if you remember to visit the bank’s website frequently and keep up to date with the latest developments. You can also keep a copy of the latest bank charges; it helps track discrepancies if the bank mistakenly collected a fee or overcharged you for a banking service.
Report inaccurate charges
Banks offer you several free services on your savings account, but some services are chargeable. You need to know them to avoid being overshadowed by lesser known costs later.
If you notice any discrepancy in your bank statement regarding banking services or transactions, you can check the same with the bank and highlight it for correction. If the bank has charged a fee to your account, you can contact the nearest bank branch and inform them of the incorrect charge. You can give an application asking them to waive the fee. You can also write a letter to the bank’s customer service, reporting the incorrect charges. As a general rule, banks will reverse fees wrongly debited from the customer’s account, provided you complained about it and your case is genuine.
(The author is CEO, BankBazaar.com)