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Banks merger: What will change for the customers?

By Vishal S
|

New Delhi, Aug 31: What will be the impact of the PSU banks' merger on the account holders is the question that customers of these banks are podering over. With the Union Government announcing four major mergers of the public sector banks (PSU Banks), the customers are worried about their deposits, EMIs and interest rate on saivngs accounts and Fixed Deposits.

While a lot of things would change, but customers need not worry as the effect on the account holders would be minor ones.

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    PSU Banks merger: What may change for account hoders:

    • Account number, customer IDs and the IFSC codes of the bank branches may change.
    • Auto credit of dividends via ECS, auto-credit of salary, auto debit of various bills/charges, and some standing instructions given to transfer money on a fixed date from one account to another, ideally, should not be impacted if the accounts are seamlessly merged into the financial system of the new merged bank.
    • Fixed deposit rates will remain unchanged. But paperwork of fixed deposits made will increase and the FD contract would have to be transferred from parent bank to new entity.
    • New cheque book and debit/credit cards will be issued, but customers would be allowed to use them till the current validity period.
    • The branch network of the new merged entity would become larger so access to bank branches would become easier.
    • The customers will have to update IFSC and other details with the income tax department, insurance providers also at the office so that salary transfer is hassel free.
    • Bank stationery will change.
    • Savings account interest rate may change.
    • It is it not clear what will happen to the interest rates of those who have loans running with these banks as the MCLR rates are different for different banks.
    • Fixed deposit rates will remain unchanged. Customers can continue till maturity on the same interest rate even if the deposit rates of the merged entity are higher or lower.
    • Loan will simply be transferred to the merged entity and you will continue to pay EMIs as usual.
    • The new merged entity may charge you less or more for services customers are accustomed to paying for.

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