Navigating the world of banking can often feel like deciphering a complex code, especially when it comes to understanding the rules surrounding minimum balance requirements. These rules, which vary significantly between banks, can impact your finances if you're not careful. Here's a comparison of the minimum balance rules across some of India's major banks, including SBI, ICICI, and HDFC.
State Bank of India (SBI)
SBI, the country's largest public sector bank, has taken a customer-friendly approach by waiving the minimum average balance (AMB) requirement for all savings accounts. This decision, implemented in March 2020, means that customers are not penalized for failing to maintain a specific balance in their accounts. This move supports financial inclusion, allowing individuals to maintain accounts without the pressure of meeting balance thresholds. While there's generally no maximum balance limit, some accounts like the SBI Basic Small Savings Account have a limit of Rs. 50,000.
ICICI Bank
In contrast to SBI's approach, ICICI Bank, a major private sector lender, has recently revised its minimum balance requirements, effective August 1, 2025. This revision primarily affects new savings accounts opened on or after this date. The new rules stipulate a significant increase in the minimum average monthly balance (MAB):
Failure to maintain these MAB requirements will result in a penalty of 6% of the shortfall or Rs 500, whichever is lower. The bank calculates MAB based on the average of day-end balances in a calendar month. This means you don't need to maintain the exact MAB every day, but your average daily balance over the month must meet the requirement. These changes have sparked criticism, with some calling the move "elitist".
HDFC Bank
HDFC Bank, another leading private sector bank, has a more nuanced approach to minimum balance requirements. The minimum average monthly balance (MAB) depends on the branch location:
If the MAB is not maintained, HDFC Bank levies penalties. The penalty can be up to Rs 600 for urban accounts and up to Rs 300 for rural and semi-urban accounts.
Other Banks
Other banks like Axis Bank, Bank of India, Canara Bank, Punjab National Bank (PNB), and Bank of Baroda have varying minimum balance rules. Some public sector banks like Canara Bank, PNB, and Bank of Baroda have waived or redefined their minimum balance requirements to promote financial inclusion. Axis Bank requires a minimum balance of around ₹12,000 for its Easy Access Account in metro and urban branches, while Bank of India has minimum balance requirements of ₹1,000 for urban/metro and ₹500 for semi-urban/rural areas.
Impact and Considerations
ICICI Bank's recent increase in minimum balance requirements contrasts with the trend of many public sector banks waiving such requirements. This move could potentially influence customers to reconsider their banking preferences, possibly shifting to banks with lower minimum balance requirements or opting for basic savings accounts without such thresholds. Banks impose these requirements to cover operational expenses. However, customers who fail to maintain the required balances face penalties. Some banks may waive these charges under certain conditions, such as enrollment in specific programs or for pensioners.
Understanding the minimum balance rules of different banks is essential for managing your finances effectively. Consider your banking needs, location, and ability to maintain the required balances when choosing a savings account. If you find it challenging to meet these requirements, explore options like basic savings accounts or banks with more lenient policies.
