The People’s Bank of China has barred Chinese banks from charging penalty fees on small deposits, South China Morning Post said. The central bank said that the rule is enshrined in the Commercial Bank Law and therefore does not apply to foreign banks in China, which are governed by another set of regulations.
The bank was reacting to reports of proposals by the Industrial and Commercial Bank of China to impose penalties on small deposits. According to the bank, 20m of its 500m accounts held less than Yn100 and the cost to the bank of keeping an account was the same, whatever the amount held. The bank’s vice-president was quoted as calling for changes in the rules to allow special charges on small deposits. ICBC later said that the vice-president had been misreported and that he had merely said that a proposal for foreign banks to charge small depositors was commercially justified.