A Chinese state bank has taken the lead in the industry to offer a much lower interest rate for small accounts, a controversial move the bank said was designed to improve efficiency, but many blame it for shirking social responsibilities.

Current deposits of no more than 500 yuan (62.5 U.S dollars) with China Construction Bank's Shenzhen and Qingdao branches now enjoy a mere 0.01 percent interest rate, compared with 0.72 percent for higher amounts.

After an interest tax is imposed, 500 yuan just yields 0.04 yuan (0.5 U.S. cents) a year.

China's central bank has already scrapped the lower limit on deposit interest rates, but commercial banks are still offering identical rates. Construction Bank's decision was unprecedented.

Analyst acknowledge it is unblamable for CCB to differentiate client services, but as a state-controlled bank, it should also bear social responsibilities such as serving in earnest the low-income class.

The interest rate for small deposits actually falls in the negative territory, given that China's inflation stands at more than 1 percent.

A central bank official argues that CCB's attempt has "double functions." On one hand, it shows the bank is taking advantage of more pricing tools to manage assets, debts and investment; on the other, it is a reflection of accelerated interest rate marketization.

A CCB spokesman said the bank intends to economize on resources and raise business efficiency by letting depositors combine some "idle" accounts into a single one.

Among the CCB Shenzhen branch's 5.63 million individual current deposit accounts ahead of the interest-lowering move, 77.4 percent reportedly had a daily balance below 300 yuan, and 43 percent with less than 10 yuan.

These "sleeping" accounts used up about half of the CCB's system resources, the spokesman said, adding that he believe other banks are facing similar problems.

Wang Peiyuan, an associate professor with Shenzhen University financial department, said the Chinese traditionally incline to keep most of their income in banks, but banks now do not need that much deposits for loan extension purpose.

He cited the government is tightly controlling investment in real estate, steel, cement and other sectors in an effort to cool down the roaring economy. Bank loans are a major source of investment.

Come what will, state banks should not "hurt the feeling" of small depositors, who have contributed greatly to the industry's development over the past decades, Wang said.

A man surnamed Hou who earns more than 800 yuan in Shenzhen told Xinhua that he felt "unfairly treated" by the CCB, the only bank outlet near a small house he rents.