Fri Aug 01 19:01:36 UTC 2025: **News Article:**
**SBI Ordered to Compensate Customer Over Undisclosed Overdraft Account**
Karimnagar, August 2, 2025 – The State Bank of India (SBI) has been directed by the Consumer Disputes Redressal Commission in Karimnagar to pay compensation to a customer, Gaddam Shivaramakrishna, after the bank failed to adequately inform him about the creation of an overdraft account linked to a disputed debit card transaction.
The case arose from a reversed merchant transaction in April 2019, which led SBI to open a ₹1,200 overdraft account in Mr. Shivaramakrishna’s name without his explicit consent, according to the customer. While SBI claimed to have notified the customer orally and via text message, the Commission found no concrete evidence to support this claim.
Mr. Shivaramakrishna argued that the existence of the uncommunicated overdraft account and subsequent reporting of an active loan on his CIBIL report negatively impacted his credit score.
While the Commission acknowledged SBI’s right to create overdraft accounts in cases of failed ATM transactions, citing RBI guidelines, it ruled that the bank’s failure to properly notify Mr. Shivaramakrishna constituted a deficiency in service. The Commission is expected to release the specific compensation amount shortly.
**Summary:**
A consumer commission in Karimnagar, India, has ordered SBI to compensate a customer for failing to properly notify him about an overdraft account created due to a reversed transaction. The customer argued that this affected his CIBIL score. While the commission acknowledged the bank’s right to create such accounts under RBI guidelines, it found the lack of communication a deficiency in service.
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