New Delhi, Aug 13 Facing widespread outrage, private lender ICICI Bank on Wednesday partially reversed its minimum average balance (MAB) requirements from Rs 50,000 to Rs 15,000 for new customers in Metro and urban areas.
The revision came after a pushback from customers and days after the second-largest bank in the country raised the MAB requirement from Rs 10,000 to Rs 50,000 for new customers in urban cities.
The minimum balance that new ICICI Bank customers in semi-urban areas must maintain has also been reduced to Rs 7,500 from Rs 25,000.
For rural locations, the MAB has been reduced to Rs 2,500 from Rs 10,000 as recommended earlier.
However, the bank has clarified that if customers keep less balance than the prescribed limit in their account, then they will have to pay a penalty.
Earlier in the day, HDFC Bank followed suit by elevating MAB to Rs 25,000, effective from August 1, 2025 for new savings account holders.
As per the HDFc Bank updated terms, accounts holders should maintain Rs 25,000 balance, For urban and metro bank branches, the penalty is calculated as 6 per cent of the shortfall or Rs 600, whichever is lower.
Major lenders like SBI, PNB, and Canara Bank have removed minimum balance requisite for saving accounts, while also removing penalty charges for non-maintenance.
Meanwhile, Reserve Bank of India (RBI) Governor Sanjay Malhotra has said that the minimum balance limit for saving accounts will be decided by banks as the decision does not fall under any regulatory jurisdiction, after India’s second largest lender ICICI Bank raised the monthly minimum average balance requirement for all customer segments.
He further said that some banks have fixed this limit at Rs 10,000, while some banks have kept this limit at Rs 2,000 for customers.
However, there are many banks that have completely removed it for their customers. "This decision does not fall under the regulatory domain," he clarified.
According to an earlier ICICI Bank's decision, customers at metro and urban locations who opened their savings accounts on or after August 1 had to maintain Rs 50,000 monthly average balance to avoid penalties. The minimum average balance for older customers remained Rs 10,000.
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