MUMBAI: The State Bank of India (SBI) has written to the Reserve Bank of India (RBI) requesting a revision in rules to include non-financial transactions, such as balance inquiries or statement requests, before classifying accounts as “inoperative account.”
SBI Chairman C.S. Setty explained that many accounts, especially those receiving government benefits, witness only a few financial transactions before becoming dormant.
Speaking at a recent event, Setty noted that under current regulations, accounts without financial transactions for a specified period are tagged as inoperative accounts, even if customers perform non-financial activities.
These activities, he argued, demonstrate customer engagement and should be sufficient to keep accounts active. SBI has launched a special drive, utilising its vast network of over 22,000 branches and business correspondents, to address the issue and reach out to affected account holders.
The RBI recently directed banks to prioritise resolving issues related to inoperative accounts or frozen accounts and mandated quarterly progress reports.
Misselling
On concerns about misselling insurance and financial products, raised by Union Finance Minister Nirmala Sitharaman, Setty called for user-friendly digital solutions to make such products self-explanatory and easier to purchase.
He emphasised that no stakeholder intends to indulge in misselling and suggested a mobile-first approach to reduce dependency on physical branch visits.
At an event honoring 29 Paralympic athletes for their achievements, Setty also highlighted SBI’s CSR efforts, stating that the bank spends Rs630 crore annually on skill development, primarily for rural populations. These initiatives include vocational training tied to business loans to support enterprising beneficiaries.
