ICICI Bank hikes minimum savings account balance in metros, urban areas from Rs 10,000 to Rs 50,000

ICICI Bank has announced a steep increase in the minimum average balance (MAB) requirements for its savings accounts, effective August 1, 2025. This hike impacts customers across metro, urban, semi-urban, and rural branches, making ICICI’s new MAB the highest among domestic banks in India.

Under the revised structure, savings account holders in metro and urban areas must maintain a minimum average balance of Rs 50,000, a substantial jump from the previous Rs 10,000 requirement. Semi-urban branch customers now need to keep Rs 25,000 on average, up from Rs 5,000. For rural branches, the MAB has increased to Rs 10,000 from Rs 2,500.

Among domestic banks, this is the steepest minimum balance requirement. The country’s largest lender, State Bank of India (SBI), had scrapped the minimum balance rule altogether in 2020, while most other banks maintain significantly lower thresholds, typically between Rs 2,000 and Rs 10,000, to manage operational costs.

For comparison, HDFC Bank, which recently became the largest private sector lender by assets after merging with mortgage lender HDFC, requires Rs 10,000 in metro and urban branches, Rs 5,000 in semi-urban branches, and Rs 2,500 in rural branches.

Banks impose minimum balance requirements to cover their day-to-day operational expenses and investments, and customers who fall below the specified balance are subject to penalty fees.

ICICI Bank customers who fail to maintain the revised minimum balance from August 1 onward will face penalties as per the updated fee schedule. The bank has advised account holders to check their balances and ensure compliance to avoid charges.

Source: Bankbazaar

In April this year, ICICI Bank reduced the interest rate on its savings accounts by 0.25%. This move came shortly after similar rate cuts by HDFC Bank and Axis Bank, highlighting a wider trend among banks to lower deposit rates following consecutive rate cuts by the Reserve Bank of India.

Customers with savings account balances up to ₹50 lakh will now earn 2.75% interest. For balances above ₹50 lakh, the rate has also been cut by 0.25%, bringing it down to 3.25%. These changes will take effect from Wednesday, April 16.