If you hold a savings account in India, your bank’s minimum balance requirement could affect how much money you keep idle every month — and in some cases, failure to maintain it can lead to hefty penalties. Recent changes, especially by ICICI Bank, have sparked fresh discussion among account holders about which banks are more wallet-friendly.
Starting August 1, 2025, ICICI Bank has sharply increased the Monthly Average Balance (MAB) requirement for new savings accounts.
Urban branches: ₹50,000 (earlier much lower, making it a substantial jump)
Semi-urban branches: ₹25,000 (up from ₹5,000)
Rural branches: ₹10,000 (also up from ₹5,000)
Customers failing to maintain the minimum balance will face a penalty — 6% of the shortfall amount, capped at ₹500 per month.
For many salaried individuals and small business owners, especially in urban areas, the ₹50,000 limit is being seen as a steep requirement.
If you prefer not to worry about maintaining a fixed balance, the State Bank of India (SBI), Punjab National Bank (PNB), and Canara Bank offer some relief.
SBI removed the minimum balance requirement for all savings accounts in both rural and urban branches back in 2020.
PNB and Canara Bank have also scrapped penalties for non-maintenance, making them attractive choices for customers seeking flexibility.
India’s largest private sector bank, HDFC Bank, still maintains a balance rule, but it’s far less demanding than ICICI’s:
Urban branches: ₹10,000
Rural branches: ₹2,500
For many account holders, this is a manageable amount, striking a middle ground between flexibility and account benefits.
Union Bank of India offers some of the lowest rural balance requirements among major lenders:
Urban branches: ₹1,000
Rural branches: ₹250
Without a chequebook facility, these minimum limits are even lower.
IDFC First Bank sets its minimum balance depending on the category of the account:
₹10,000 to ₹25,000, depending on the product variant.
This tiered approach allows customers to choose an account type that fits their financial habits.
The recent ICICI Bank hike marks one of the steepest minimum balance requirements in India’s banking sector, potentially discouraging low-balance customers in urban centres. On the other hand, SBI, PNB, and Canara Bank’s zero-penalty policy could attract customers seeking more financial breathing room.
Financial experts advise that customers compare banks not just on minimum balance rules, but also on interest rates, service quality, and digital banking features.
With such varied policies across banks, choosing the right savings account could mean the difference between earning extra interest and paying unnecessary penalties.
Bottom line: Whether you want a high-end account with premium benefits or a zero-balance account for convenience, knowing your bank’s rules can help you avoid charges — and keep more of your money working for you.
