SBI ordered to pay retired scientist Rs 15L after failing to inform about FD maturity

A Hyderabad-based consumer commission has ordered the State Bank of India (SBI) to return Rs 15 lakh to a retired scientist along with interest after determining that the bank failed to inform him about the maturity of his fixed deposit and the option to extend it. The commission also mandated SBI to pay Rs 25,000 as compensation and Rs 10,000 toward litigation costs. Ashwani Kumar Sangamker deposited Rs 15 lakh into the Senior Citizens Savings Scheme through SBI's Barkatpura branch on December 13, 2018. The deposit carried an interest rate of 8.5 percent and was scheduled to mature on December 12, 2023. Sangamker believed the deposit had been automatically renewed because SBI's online portal displayed a new maturity date of December 12, 2028, but with a zero percent interest rate. He approached the bank in March 2025 seeking clarification and payment of the interest. According to his complaint, the bank informed him that the scheme could not be extended because he had not applied for an extension within a year of maturity. Sangamker alleged that the bank had neither notified him about the deposit's maturity nor transferred the funds to his savings account. SBI defended itself by stating that the scheme rules did not allow for automatic renewal and that the customer had to apply for an extension within one year of maturity. The bank also claimed that the portal's zero-interest display was a technical error and that the amount was eligible for post-maturity interest at the applicable savings-account rate. The consumer commission, consisting of President M Ramgopal Reddy and members D Sreedevi and J Shyamala, found that SBI had failed to inform the customer about the deposit's maturity and the option to extend it. The commission noted that the customer had acknowledged the scheme rules, including the need to apply for an extension within one year. It also referenced SBI's records, which indicated that the deposit had matured and that the customer had not submitted the required extension application in time. However, the commission ruled that SBI could not retain the customer's money at zero interest without justifying it. It cited Reserve Bank of India (RBI) guidelines, which state that if a term deposit matures and the proceeds remain unpaid, the amount left unclaimed with the bank should attract interest at the rate applicable to savings deposits or the contracted rate on the matured term deposit, whichever is lower. In its October 7, 2026 order, the District Consumer Disputes Redressal Commission-III, Hyderabad, directed SBI to pay the Rs 15 lakh deposit with interest at 8.5 percent up to the contractual maturity date and the applicable savings-deposit rate thereafter. Sangamker had initially invested the amount from his retirement benefits with the intention of using it to address any financial contingencies during his old age. He claimed that SBI did not inform him about the maturity of the fixed deposit or the possibility of extending it for another three-year term. SBI's defense included the argument that the bank had no obligation to notify depositors about maturity dates unless contact information was updated. The bank also stated that the portal's incorrect display of the maturity date and zero percent interest was a technical issue and did not affect the actual status of the account. The commission emphasized that banks must ensure proper communication with depositors regarding the maturity of their fixed deposits and the availability of extension options. This ruling underscores the importance of transparency and timely communication in banking services to prevent misunderstandings and potential grievances among customers.