The banking system in India is changing, especially regarding the minimum balance needed for savings accounts. ICICI Bank has announced that starting August 1, 2025, new savings accounts will require a higher Minimum Average Monthly Balance (MAMB).
ICICI Bank’s Strong Move: The New Minimum Balance Rules
Starting August 1, 2025, ICICI Bank has implemented higher minimum balance rules for new savings accounts:
- Urban/Metro Branches: The minimum average monthly balance now stands at a steep ₹50,000, up from the earlier ₹10,000.
- Semi-Urban Branches: It has increased to ₹25,000 from ₹5,000.
- Rural Branches: The requirement has doubled to ₹10,000 from ₹5,000.
Penalty for Non-Maintenance
If customers fail to maintain the required average balance, ICICI Bank will impose a penalty of 6% of the shortfall or ₹500, whichever is lower.
Important Note: The increased minimum balance rule only applies to new accounts opened after August 1, 2025. Existing customers will not be affected by this change.
Public Reaction and Concerns
The sharp increase, especially in urban areas (from ₹10,000 to ₹50,000), has sparked criticism from some sections of society.
Financial inclusion activists argue that these rules could discourage low-income individuals from opening or maintaining accounts in such private sector banks.
What Other Banks Are Doing
While ICICI Bank has tightened its rules, other major banks have gone in the opposite direction — easing their minimum balance requirements.
State Bank of India (SBI)
In a customer-friendly move, SBI removed the minimum average balance requirement for all savings accounts, in both rural and urban areas, back in 2020. Customers can now operate savings accounts in SBI with zero balance, without attracting any penalty.
Punjab National Bank (PNB) & Canara Bank
Both these public sector banks have scrapped penalty charges for not maintaining the minimum balance. They have completely waived the requirement for maintaining Average Monthly Balance (AMB) in any type of savings account.
Comparison of Minimum Balance Rules (Savings Account)
Here’s how various popular banks stack up when it comes to minimum balance requirements:
| Bank | Rural Branches | Urban/Metro Branches |
|---|---|---|
| State Bank of India | Zero balance | Zero balance |
| Union Bank of India | With cheque book: ₹250 / Without: ₹100 | With cheque book: ₹1,000 / Without: ₹500 |
| HDFC Bank | ₹2,500 | ₹10,000 |
| ICICI Bank | ₹10,000 | ₹50,000 |
| Axis Bank | ₹2,500 | ₹12,000 |
| Bank of Baroda | ₹500 | ₹2,000 |
| IDFC First Bank | ₹10,000 or ₹25,000 | ₹10,000 or ₹25,000 |
| Bank of India | Zero balance | Zero balance |
Understanding Minimum Average Balance (MAB)
The Minimum Average Balance is the average amount you must keep in your savings account over a month. If the average balance falls below the bank’s requirement, a penalty is charged.
For example, If a bank’s MAB is ₹10,000 and you keep ₹10,000 for only 15 days and ₹0 for the remaining 15 days, your average balance will be ₹5,000 — leading to a shortfall and a possible penalty.
What This Means for Customers
- For ICICI Bank customers (new accounts after Aug 1, 2025): Be prepared for higher minimum balance needs, especially in metros.
- For SBI, PNB, and Canara customers: Enjoy the freedom of zero-balance accounts.
- For customers of other private banks like HDFC and Axis: Make sure you know your branch category (rural, semi-urban, metro) and maintain the required balance.