Private Banks Hike Minimum Balance Requirements While PSUs Ease Up
August 2025 — With public sector banks like SBI, Canara Bank, Indian Bank, and PNB waiving minimum balance mandates entirely, private banks are taking a contrasting path—raising or enforcing MAB (Minimum Average Balance) rules more stringently. Here’s the latest breakdown:
Key Tap Changes at Major Private Banks
ICICI Bank
- Initial hike: On August 1, the MAB for new savings accounts was raised sharply to ₹50,000 in metro/urban branches, ₹25,000 in semi-urban, and ₹10,000 in rural areas. Penalty for shortfall: 6% of the deficit or ₹500 (whichever is lower)
- Customer backlash: Rapidly responding to feedback, ICICI slashed the MAB for new accounts to just ₹15,000—a significant rollback and welcome relief for many customers
HDFC Bank
- New accounts (from August 1): Must maintain ₹25,000 MAB in metro/urban branches—up from ₹10,000—but legacy accounts stay under old thresholds
- Penalty: Shortfall triggers a charge of 6% or ₹600 (whichever is lower)
Axis Bank
- Standard MAB: ₹12,000 in metro/urban; ₹10,000 in semi-urban/rural. Alternatively, customers can avoid penalties with an FD of ₹50,000+ or meet account-specific thresholds
Snapshot: Who Charges What?
| Bank | MAB (Metro/Urban, New Accounts) | Penalty for Non-Maintenance |
|---|---|---|
| ICICI Bank | Initially ₹50,000 → Reduced to ₹15,000 | 6% of shortfall or ₹500 max |
| HDFC Bank | ₹25,000 | 6% of shortfall or ₹600 max |
| Axis Bank | ₹12,000 / or FD ₹50,000 | Based on shortfall or replaced by qualifies |
| Kotak Mahindra, IndusInd, YES, IDFC | Varies, many offer zero‑balance options and tiered plans | Varies; zero-balance options exempt |
| Public Banks (SBI, Canara, PNB…) | None required | No penalties |
Zero‑Balance Account Options
Several private banks still offer zero-balance savings accounts, providing flexibility—especially for first-time or low-balance users:
- Kotak 811 (Full KYC): Zero MAB; interest up to 4%, virtual card, limited free transactions
- IndusInd Delite: No MAB but requires initial funding (~₹10,000); offers perks like rewards and cashback
- IDFC, Yes Bank, DCB, Jupiter: Offer zero-MAB accounts with digital banking features, rewards, insurance, and other value additions
