The last time you clicked on your bank’s Web site, you stared wistfully at the ad showcasing the special benefits of being a privileged customer.
Yes, being a privileged customer provides some benefits that aren’t available to other customers of the bank, but unless your banking transactions are numerous or frequent, there is nothing much to gain from being one. Here’s why.
What are the benefits?
In banking transactions, benefits take the form of lower charges on lockers, credit and debit cards, and services such as forex, Internet banking, ATM withdrawals and bill payments. Also loans, demat accounts, and other bank products like travel cards could be priced lower.
That essential cheque is also tagged with benefits – in most cases, limitations on at-par cheques and chequebooks issued in a quarter or year are lifted, cheques will be picked up for free, reduced or no charges for cheque return or stopping payments and so on.
Other advantages are that withdrawal caps at ATMs and limits on the amount you can swipe on the debit card are higher. Kotak Mahindra Bank’s privilege offering, for example, sets limits of Rs 2,50,000 withdrawing at ATMs and purchases on a daily basis.
Next, you will have separate queues or special service areas when you visit your bank, to shorten the time you spend waiting.
Banks assign Relationship Managers who are supposed to process your requests. Also, on offer are wealth management services.
Lifestyle privileges, the other form of privileges, are usually higher reward points on spending – whether debit or credit, discounts on hotels and dining, access to exclusive airport lounges and so on.
Who does it suit?
Is the privilege account worth going for?
The answer depends on the number of banking transactions you undertake. If you frequently issue or receive cheques, use the transfer and payment services on Internet banking often, then the lower charges these carry certainly help.
But most of us don’t carry out too many transactions in a month, apart from bill payments, the occasional transfer or two, or opening deposits. Further, the need to actually visit your bank is lower with banking available online or through the ATM.
The extra reward points and benefits too are available aplenty with the debit or credit card itself, independent of your bank account status. Next, while wealth management services are provided for free, your bank may not always be the best advisor around. You may find better ones if you look around.
What’s more, it gives your personal banker access to data on your investments and savings.
You may have to deal with frequent calls of marketing executives looking to sell you products. In such cases, being a privileged customer doesn’t hold much weight. Other benefits too, may sound better on paper, but don’t turn out to be very beneficial in reality.
For instance, with travel card charges already relatively minimal, lower charges on these are unlikely to amount to much. Similarly, the quantum of discounts on exchange rates may change and is not actually specified. Getting preferential treatment for lockers too, is subject to your meeting the eligibility criteria for hiring the lockers, which may range from buying insurance products to the amount of fixed deposits you hold with the bank.