ICICI Bank Raises Minimum Average Balance Requirement for New Savings Accounts

Strategic Insights -

ICICI Bank's decision to increase the minimum average balance (MAB) requirement for new savings accounts opened on or after August 1 has sparked outrage. The bank has set the MAB at Rs 50,000 in urban areas, Rs 25,000 in semi-urban locations, and Rs 10,000 in rural areas. This move is seen as detrimental to the government's vision of inclusive banking and growth, with some public sector banks waiving the penalty for failing to maintain the minimum balance.

Key Takeaways:

  • The minimum monthly average balance (MAB) for savings bank accounts at ICICI Bank was Rs 10,000 till July 31, 2025.
  • ICICI Bank's decision to increase the MAB requirement has been criticized by a civil society organization, "Bank Bachao Desh Bachao Manch", which has written to the Finance Ministry to intervene.
  • The MAB requirement has been increased five times for new savings accounts opened on or after August 1.
  • Customers who fail to maintain the minimum prescribed balance in some public sector banks do not need to pay a penalty.
  • Traditionally, public sector banks have lower balance requirements compared to private lenders.

Statistics:

  • Rs 50,000: the minimum average balance (MAB) required in urban areas for new savings accounts opened on or after August 1.
  • Rs 25,000: the MAB required in semi-urban locations for new savings accounts opened on or after August 1.
  • Rs 10,000: the MAB required in rural areas for new savings accounts opened on or after August 1.
  • Rs 10,000: the MAB requirement for savings bank accounts at ICICI Bank till July 31, 2025.
  • August 1: the date from which the new MAB requirement goes into effect.

Sources:

  • "Diligent Media Corporation Ltd., DNA (Daily News & Analysis)"
  • "Bank Bachao Desh Bachao Manch"