IDBI BANK

banking without banking charges

Waives off all Bank Charges
 List of charges that have been removed:

Average Balance Charges

Account Closure Charges
ATM Inter Change Fee
Eft Charges
New Card Issue
Outstation Cheque Collection
Cont.

Cardfee New - Master

Cardfee New - VISA
Cash Services Charges
Cheque Book Charges
DD Charges
ECS Charges
Cont.
PO Charges
Account Statement Charges
Standing Instructions Charges
Stop Payment Charges
Outward Charges
Micr Cheque Charges
DD Cancellation Charges
DD Issue Charges
Causes of Changes in Policy
To Strengthen the Bank's bond with its
customers
 To grow low-cost deposits, retain
customers and attract new ones.
To help boost its low-cost CASA deposit
base to around 20 per cent of the total
deposits in the next six months, from the
current levels of 13%.
Pressure from RBI to increase their
CASA Deposits to industry average
levels.
How does it affect the Customers
Any account holder, who walks into the
bank and asks for a demand draft, will get
it without a charge.
 Any account holder can do an Electronic
Fund Transfer, without a charge.
 No account holder will have to worry
about keeping a minimum balance in his
or her account. 
Cont..
An account holder will be able to withdraw
money from ATM as many times as he may
want to without paying a charge.
All the charges levied by a bank except
those pertaining to bounced cheques have
been waived.
How does it Impact the Bank
Bank expects to increase its share of current and
savings account (CASA) deposits to 22% by the
end of this fiscal from current levels of 13% as
against industry average of 30%
Bank is aiming to double its client base to 10
million (one crore) customers in the next 12 months
from existing 5 mn.
Bank will lose revenue as the income from as Fee
Income would be come down.
Tremendous increase of workload on the
Workforce as the business will grow in folds.
How will the Bank Mitigate its
losses
The Management says that they would
rather earn fees on the assets side of the
balance sheet by syndicating a Rs 5,000-
crore loan and earn Rs 50 crore fees than
go after small charges on the liabilities side.
Before March next year they plan to add
280 more branches in urban, semi-urban
and rural India covering all states and union
territories.
Cont..
IDBI bank has embarked on a massive expansion-
cum-diversification programme during this year
They Plan to increase the number of ATMs by
adding around 400 to 500 new ones and take the
total figure to 1,300 ATM kiosks.
In next three years, the bank is planning to open
1,500-2,000 branches which would triple their
existing base.
IDBI Bank has decided to raise at least one billion
USD during the next 12 to 15 months
Cont..
 The Bank has recently received capital
injection of Rs 3,011 crore from the
Government.
Since Large corporate, mid-corporate and
SMEs know them quite well, they would not
find it very difficult to lend the money to
them
IDBI wants itself to be known as a universal
bank that caters to the financial needs of the
common man.
Questions which remains open
Will it REVOLUTIONAIZE the entire
banking industry?
Will IDBI Bank be able to cope up with
the increased work pressure?
Do they have the sufficient resources to
stand tall against such a huge scale up in
their business?
How far will it impact its Top and Bottom
Line of IDBI Bank?
Cont..
Will the Banking Industry become a lot more
competitive and will it result in a similar
situation as to Telecom Sector?
What is the preparation level of Peers in the
Industry?
Which kind of Banks will be the most affected
because of this bold step of IDBI Bank
How will it impact the plans of upcoming
Domestic Banks like the Reliance Capital and
LIC Housing Finance and also the Foreign
Banks.