ICICI Bank Increases Minimum Deposit Requirement for New Clients: Examining the Implications
In a significant move, ICICI Bank has announced changes to the minimum average monthly balance (MAB) requirements for savings accounts, effective from August 1, 2025. These changes come as part of the bank's strategy to attract a more premium customer base.
The new MAB requirements vary by location type (metro, urban, semi-urban, rural), with notable updates from ICICI Bank. Initially, the bank had planned to hike the MAB drastically, but following customer feedback, these increases have been moderated.
- Metro and Urban areas: Revised down to ₹15,000 from the initially proposed ₹50,000.
- Semi-Urban areas: Revised to ₹7,500 from an attempted increase of ₹25,000.
- Rural areas: Revised to ₹2,500 from an attempted increase of ₹10,000.
These revised MAB rules apply only to accounts opened on or after August 1, 2025. Accounts opened before July 31, 2025, are exempt from these changes.
Other private banks are also expected to have their own MAB and penalty policies, often stricter than public sector banks (PSBs). However, specific current MAB values for other major banks as of August 2025 are not detailed in the search results.
In contrast, PSBs such as SBI, Canara Bank, PNB, and Indian Bank generally do not charge penalties nor impose minimum balance requirements on savings accounts, promoting zero-balance facilities especially for financial inclusion. The Reserve Bank of India (RBI) clarified that minimum balance policies are at banks’ discretion, and PSBs tend to be lenient or zero-balance.
HDFC Bank maintains a minimum average monthly balance requirement of Rs 10,000 in metro and urban branches, Rs 5,000 in semi-urban areas for regular savings accounts. The Savings Max Account in HDFC Bank requires an average monthly balance requirement of Rs 25,000.
For ICICI Bank's DigiSave Youth Account, the average monthly balance requirement is Rs 5,000 and Rs 2,500, respectively, in metro and urban branches, and semi-urban areas. New rural and semi-urban customers may retain a minimum balance of Rs 5,000.
It is important to note that State Bank of India has scrapped minimum balance penalties entirely. Lower-income customers may find fewer options in the private banking sector if more banks increase minimum balance requirements.
Customers failing to meet the new minimum average monthly balance requirements will incur a penalty, which will be either 6% of the shortfall amount or Rs 500, whichever is lower. Existing customers will continue with the earlier minimum balance requirements.
With these changes, we may see a shift where premium account products become the norm in urban centres, potentially limiting options for lower-income customers in the private banking sector. It is advisable for customers to review their bank's policies regularly to ensure they are meeting the requirements.
- The revised minimum average monthly balance (MAB) requirements by ICICI Bank in Metro and Urban areas, now set at ₹15,000, indicate a shift towards attracting a more premium customer base in the finance sector.
- Other private banks, including HDFC Bank, often impose stricter minimum balance policies compared to public sector banks (PSBs), potentially creating challenges for lower-income customers seeking banking services in the business sector.
