ICICI Bank Hikes Minimum Balance to Rs 50,000
ICICI Bank, India’s second-largest private lender, has made headlines by sharply increasing the minimum monthly average balance (MAB) for its accounts. Starting from August 2025, customers in metro areas will now need to maintain a balance of Rs 50,000, up from Rs 10,000. This significant hike is not limited to urban areas; semi-urban branches now require Rs 25,000, while rural branches mandate a balance of Rs 10,000, compared to the earlier requirement of Rs 2,500.
The MAB is the minimum balance that customers must keep in their bank accounts. Failure to maintain this balance will result in penalties levied by the bank. ICICI Bank has stated that customers who do not meet the MAB criteria will incur a penalty of 6% on the shortfall or a flat fee of Rs 500, whichever is lower.
This decision by ICICI Bank marks a significant shift in banking practices. Interestingly, while ICICI Bank is enforcing these new rules, many public sector banks (PSBs) have recently started waiving off penalties for non-maintenance of minimum balances. According to the finance ministry, PSBs collected nearly Rs 9,000 crore in penalties over the last five years from customers who failed to maintain their MAB.
As per the data shared in Parliament, state-owned banks have charged Rs 8,932.98 crore in penalties since the 2020-21 financial year. This increase in charges by ICICI Bank comes at a time when other banks, including Union Bank of India and Canara Bank, are easing their penalties, indicating a contrasting approach in the banking sector.
In addition to the MAB hike, ICICI Bank has also revised its cash transaction rules. Customers will be allowed three complimentary cash transactions per month, after which a fee of Rs 150 will be applied. The cumulative limit for these transactions is set at Rs 1 lakh per month. If customers exceed this limit, they will incur charges based on the number of transactions or the value limit, whichever is greater.
As these changes take effect, it is crucial for account holders to understand how they might impact their banking experience. With increasing financial pressure from rising balance requirements and transaction fees, customers should consider their banking options carefully moving forward.
