ICICI Bank will raise the minimum balance for savings accounts from August 1, 2025. Metro customers must now maintain ₹50,000, with steep hikes for semi-urban and rural areas.
In a significant policy change, ICICI Bank has announced a sharp increase in the minimum average balance requirement for its savings accounts across the country. The revised rules will come into effect from August 1, 2025, and are expected to impact millions of account holders, especially in rural and semi-urban regions.
New Minimum Balance Requirements
Under the new guidelines, ICICI Bank customers will need to maintain substantially higher balances in their accounts, depending on their branch location:
- Metro and Urban Areas: ₹50,000 (up from the earlier ₹10,000)
- Semi-Urban Areas: ₹25,000 (previously ₹5,000)
- Rural Areas: ₹10,000 (previously ₹2,500)
This increase marks a fivefold jump for metro and urban customers, and even steeper for some rural account holders, potentially creating challenges for low-income individuals who struggle to maintain large balances.
Penalty for Non-Maintenance of Balance
According to ICICI Bank, customers who fail to meet the required Monthly Average Balance (MAB) will be charged a penalty of 6% of the shortfall amount or ₹500 — whichever is lower.
However, the bank has clarified that these charges can be waived if customers are part of certain banking programs.
Family Banking Program & Exemptions
Under the Family Banking Program, all members of a family linked under one banking relationship can maintain 1.5 times the required collective balance to avoid charges. If the group fails to meet this threshold, non-maintenance penalties will apply individually to those who don’t meet their personal MAB requirement.
Pensioners are exempt from these non-maintenance charges, offering some relief to elderly customers.
Other Banking Charges Updated
The bank has also revised fees for certain transactions:
- ECS/NACH Debit Returns: ₹500 per instance (for financial reasons such as insufficient funds), with a maximum of three charges per month for the same mandate.
- Outward Cheque Returns: ₹200 per instance for cheques returned due to financial reasons.
- Inward Cheque Returns: ₹500 per instance for financial reasons, and ₹50 for non-financial reasons (except signature verification issues).
Impact on Customers
This hike in minimum balance requirements is expected to influence banking choices for many customers. Low-income account holders, particularly in rural and semi-urban areas, may find it difficult to maintain the higher balances.
As a result, some customers might consider:
- Switching to banks with lower minimum balance requirements.
- Opting for Basic Savings Bank Deposit Accounts (BSBDA), which have no minimum balance mandate as per RBI guidelines.
Banking industry experts believe that while the move could help ICICI Bank strengthen its deposit base, it also risks alienating smaller account holders.
ICICI Bank’s Possible Rationale
While the bank has not issued an official statement detailing the reasons behind the change, analysts suggest that it could be aimed at:
- Increasing low-cost deposits to strengthen the bank’s balance sheet.
- Encouraging customers to maintain higher account balances, improving liquidity.
- Targeting a more premium customer base in metro and urban regions.
What Customers Should Do
Before August 1, 2025, ICICI Bank customers should:
- Review their current average balances.
- Explore eligibility for Family Banking or other programs to avoid charges.
- Consider whether their existing account type remains the best fit for their needs.
For those unable to meet the new minimum requirements, switching to an account type with no minimum balance or choosing another bank could prevent recurring penalties.
