Being an SBI account holder, you must be informed about lien amount. This article offers meaning of lien amount, circumstances when the bank can lien your amount along with the resolution of lien amount.
SBI and other financial and banking institutions use “lien amount” many times. The bank itself holds the right to exercise lien on your account balance. However, you can resolve this lien and use your funds as and whenever you desire.
Lien Amount Meaning in SBI
Lien refers to “lock” and in SBI, lien amount stands for the amount that has been locked by the bank. It means that the bank has frozen the funds for a particular period. The bank can put either the entire balance or a part of this balance on hold. You lose the eligibility to withdraw this lien amount or utilize it for whatsoever reason till the bank removes the lock.
Circumstances when lien right is exercised
SBI or other banks can never put a lien on your account balance without any valid reason. If you ever see charged mark as lien amount in your account and you are unaware of the reason, then you must go through the following lists of circumstances:
- Failure in the repayment of loan EMI
- Failure in complying with the account minimum balance requirements
- Due to some error in bank software (automatic resolution in such a case)
- Deposition of fixed deposit/term deposits as security for the loan
- When the bank realizes amount usage for some unlawful or illegal activities
- Failure in tax payment
- Issues related to bank draft or cheque
Resolution of lien
You can lift lien from your amount by making a payment of the required amount. The bank will lift the lien once the settlements have completed regarding liabilities. You can also enjoy this additional fund for any purpose. In case of failure in liabilities settlement, you should go to nearby SBI branch and ask for lien lifting.
Frozen of account balance may stop you from doing necessary activities. Therefore, in order to avoid troubles, you should always make sure to keep adequate amounts enough for lien prevention.