Daijiworld Media Network - New Delhi

New Delhi, Aug 9: ICICI Bank, India’s second-largest private sector lender, has significantly increased the monthly minimum average balance (MAB) requirement for new savings account holders across all regions, effective August 1.

As per the bank’s updated policy, new customers in metro and urban areas must now maintain a monthly average balance of Rs 50,000 to avoid penalties. In contrast, existing customers in the same regions are still required to maintain a MAB of Rs 10,000.

For semi-urban locations, new account holders must maintain Rs 25,000, while in rural areas, the new threshold is Rs 10,000. Older customers in these regions continue with the lower MAB of Rs 5,000.

Customers failing to meet the required balance will face a penalty of 6% of the shortfall or Rs 500, whichever is lower.

In addition to the balance requirement changes, ICICI Bank has also updated its transaction rules. Savings account holders are now entitled to three complimentary cash deposits per month, after which a fee of Rs 150 per deposit is applicable. The monthly cumulative deposit limit is set at Rs 1 lakh.

The limit for free cash withdrawals also remains at three per month, and third-party deposits are capped at Rs 25,000 per transaction for all savings accounts.

In a move earlier this year, in April 2025, the bank reduced its interest rate on savings accounts by 0.25%, bringing the rate down to 2.75% for deposits up to Rs 50 lakh.

ICICI’s steep hike in minimum balance requirements stands in contrast to public sector giant SBI, which abolished its minimum balance rule in 2020, and most other banks that continue to maintain lower thresholds, typically ranging between Rs 2,000 and Rs 10,000.

The move could impact customer choice, especially among new entrants in metro and urban areas, as banking charges and balance requirements become a growing factor in account selection.