ICICI Bank minimum balance charges for saving account!
Effective August 1, 2025, ICICI Bank has dramatically increased the minimum monthly average balance (MAB) required for new savings accounts.
In this post, we explain the new thresholds across different regions, existing customer status, associated penalties, and alternatives—so you know exactly what to expect and how to plan ahead.
What Has Changed?
Based on recent reporting:
- Urban & Metro Branches: Minimum MAB raised from ₹10,000 to ₹50,000—a fivefold increase.
- Semi-Urban Branches: Requirement increased from ₹5,000 to ₹25,000.
- Rural Branches: Minimum MAB raised to ₹10,000, up from ₹2,500–₹5,000.
- These changes apply only to accounts opened on or after August 1, 2025. Existing customers maintain their older MAB levels.
Penalty Structure
Failure to maintain the required MAB will incur a penalty equal to 6% of the shortfall, capped at ₹500—whichever is lower. For instance, a ₹10,000 shortfall would typically lead to ₹600, but under the new rule, the maximum penalty is capped at ₹500.
Additionally, cash deposit/withdrawal charges have been updated:
- 3 free branch transactions per month up to ₹1 lakh.
- Beyond that: ₹150 per transaction or ₹3.5 per ₹1,000, whichever is higher.
- Third-party deposit limit capped at ₹25,000.
Exemptions from MAB Rule
Some accounts remain completely exempt from this high MAB requirement:
- Salary Accounts
- Basic Savings Bank Deposit Accounts (BSBDA) – Zero-balance accounts mandated under RBI guidelines
- PRADHAN MANTRI JAN DHAN Accounts
These accounts are not subject to MAB requirements, ensuring basic banking remains accessible.
Why This Change Matters & Public Reaction
- Premium Positioning: Analysts suggest the hike signals ICICI’s strategic shift toward affluent customers—aiming higher NRI and mass-affluent segments.
- Widening Inequality Concerns: Critics argue that fivefold hikes in MAB make formal banking harder for lower-income and middle-class users, hampering financial inclusion.
Many competing public-sector banks are reducing or eliminating MABs altogether—making ICICI’s hike even more controversial.
Summary Table
| Customer Type | Location | Minimum Average Balance | Penalty for Shortfall |
| Existing Accounts | Metro/Urban | ₹10,000 | Applicable per old terms |
| New Accounts (Aug 2025) |
Metro/Urban | ₹50,000 | 6% of shortfall or ₹500 max |
| New Accounts | Semi-Urban | ₹25,000 | Same penalty rule |
| New Accounts | Rural | ₹10,000 | Same penalty rule |
What This Means for You
| Branch Type | Old MAB Requirement | New MAB (for new accounts) | Penalty for Shortfall |
| Metro & Urban | ₹10,000 | ₹50,000 | 6% of shortfall, capped at ₹500 |
| Semi-Urban | ₹5,000 | ₹25,000 | Same penalty |
| Rural | ₹2,500–₹5,000 | ₹10,000 | Same penalty |
| Existing Customers | Existing MAB held | No change | Remain under old terms |
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Action Plan for Customers
-
- Existing customers can continue under previous MAB levels with no changes required.
- New account holders must assess if ₹50,000+ is feasible, else opt for exempt account types (BSBDA or salary accounts).
- Always track your average balance via ICICI’s internet or mobile banking to avoid surprise penalties.
- Consider switching banks if unable to meet high MAB, as many offer lower or no-MAB options with similar services.
- If you can’t meet the higher MAB, you can request a conversion to a BSBDA to avoid penalties.
- Stay vigilant—monitor your MAB regularly via net banking or mobile banking.
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Conclusion
ICICI Bank’s dramatic hike in minimum balance requirements marks a key shift in its target audience—favoring premium customers.
While the change may not affect long-standing account holders, new customers will need to reconsider their banking strategy—either opting for higher-tier accounts or choosing alternatives that support financial inclusion moves.
