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Often we feel that the money deposited in our bank account is completely under our control and no one can touch it without our permission. This is also true legally, but within the banking system there are some ‘Terms & Conditions’ These are hidden, which give the bank the right to deduct money from your account under certain circumstances. It is now more important than ever to understand these nuanced rules for financial security in the digital age.
When your old ‘consent’ becomes the basis
In most of the cases, for the money deducted by the bank, you have given written or digital approval at the time of opening the account or at some point later. We often ignore this:
Auto-Debit and EMI: If you have set up an e-mandate for a loan installment (EMI), insurance premium or mutual fund (SIP), the bank will automatically deduct the money on the scheduled date.
Standing Instruction: Once you give ‘Standing Instruction’ for subscription to OTT platforms like Netflix or Amazon Prime, the bank does not need to ask you again.
Game of service charges and hidden fees
Banks charge various fees for their services, which are deducted directly from your balance. Prominent among these are:
Maintenance and Penalty: The bank deducts a penalty if you do not maintain ‘minimum balance’ (minimum amount) in the account.
Annual Fee: Your debit card (ATM) annual fee, SMS alert charge and charges for making ATM transactions beyond a limit also fall in this category. All these are part of the bank’s policy.
‘Right of Set-off’: Bank’s most powerful weapon
This is a banking rule that very few people are aware of. If you have taken a loan from a bank and you are not paying its installments on time, then the bank ‘Right of Set-off’ Has the right to. Under this, the bank can directly deduct money from your other savings account of the same bank to recover the outstanding amount. Apart from this, on the notice of Income Tax Department or court order, the bank is legally bound to deduct the money from your account and give it to the concerned department.
Caution removed, accident occurs: When can a wrong deduction occur?
It is not right to cut money every time. Sometimes due to technical fault or human error ‘Double Charge’ (Deducting money twice for the same transaction) may occur. most dangerous situation ‘Cyber Fraud’ Is of. If you have not given any approval nor is it a bank charge, then be alert immediately.
Follow these 3 steps immediately in case of unexpected cuts
Close examination of the statement: Through net banking or mobile app, check immediately in the name of which merchant or which head the money has been deducted.
Written complaint to the bank: If the transaction seems suspicious, immediately call customer care and visit the nearest branch of the bank and lodge a written complaint.
Keep digital alert on: Always keep SMS and email notifications on on your phone so that you get informed immediately if there is a deduction of even ₹1.