Why Did ICICI Raise the Minimum Balance? Big Changes Start August 1- Let’s See
As an ICICI Bank customer, Everyone was recently notified of a significant change in the minimum average balance (MAB) requirements for savings accounts, effective August 1, 2025. According to the bank’s updated policy, account holders in metro and urban branches must now maintain a MAB of ₹50,000, a sharp increase from the previous ₹10,000. For semi-urban branches, the new requirement is ₹25,000, up from ₹5,000, while customers in rural branches will now be required to maintain a MAB of ₹10,000, compared to the earlier ₹2,500.
The revised thresholds may pose challenges, particularly for customers in lower income brackets or those based in non-metro locations. ICICI Bank has stated that a penalty of 6% of the shortfall or ₹500, whichever is lower, will be applied in cases of non-compliance. As a result, many customers—including myself—are now reassessing banking options and evaluating whether to switch to basic savings accounts or consider banks with more flexible balance requirements.
Minimum Balance: What’s Changed And Where
The revised MAB criteria apply across all branch types. ICICI raised the metro and urban MAB to Rs 50,000, targeting higher-income segments. Semi-urban areas saw the MAB quintuple from Rs 5,000 to Rs 25,000. Rural branches are not spared either—their requirement has grown from Rs 2,500 to Rs 10,000. These shifts may push users toward basic savings accounts, which don’t require minimum balances. According to ICICI, this move aligns with evolving customer profiles and rising transaction volumes. The bank hasn’t stated specific reasons publicly, but the change hints at a focus on profitability, operational efficiency, and digital banking adoption.
Minimum Balance Penalties: What It Will Cost You
- Non-Maintenance Charges:
ICICI Bank will levy a charge of 6% of the shortfall or ₹500, whichever is lower, if the required minimum average balance (MAB) is not maintained. - Program-Based Waiver:
Charges will be waived if the customer is enrolled in a qualifying program and meets its eligibility criteria. - Family Banking Rule:
Under the Family Banking arrangement, the family must collectively maintain 1.5 times the program’s MAB requirement to avoid penalties. - Individual Responsibility:
If the family fails to meet the collective requirement, individual members who do not meet their own MAB will be charged separately. - Pensioner Exemption:
Pensioners are fully exempt from non-maintenance charges, regardless of balance. - Policy Focus:
This structure reflects the bank’s emphasis on program loyalty and customer segmentation, while still enforcing individual accountability for shortfalls.
ICICI Bank: Minimum Balance & Transaction Charges (Effective August 1, 2025)
- ECS/NACH Debit Return Charges:
₹500 per instance, capped at three charges per month per mandate for returns due to insufficient funds. - Outward Cheque Return (Customer Deposited Cheque Bounced):
₹200 per instance. - Inward Cheque Return (Customer-Issued Cheque Bounced):
- ₹500 per instance for financial reasons (e.g., insufficient funds).
- ₹50 per instance for non-financial reasons (excluding signature mismatch).
- Failed Card Transactions (Insufficient Balance):
₹25 per instance for failed transactions at other bank ATMs or POS terminals.
Minimum Balance Strategy: What You Can Do Now
As both a long-time ICICI customer and someone who keeps a close eye on banking trends, here’s my advice: don’t panic, but definitely plan. If the new minimum average balance (MAB) feels steep, consider switching to a basic savings account—it has no MAB requirement. Alternatively, you could enrol in a salary account or join Family Banking, where eligible customers often receive fee waivers. Personally, I’ve started tracking my monthly balance more closely and consolidated idle funds from other accounts into one. It’s also smart to enable banking alerts, use budgeting apps, and review ICICI’s digital tools—they’re surprisingly helpful. And let’s be honest, this move by ICICI might be a signal—other banks could follow. So, whether you stay or switch, staying informed is your best financial defense. Think of this as a chance to upgrade your banking habits before charges start eating into your balance.
(With InputsFrom ANI)
