Introduction – Why This News is Making Headlines
ICICI Bank’s recent announcement on increasing its Minimum Monthly Average Balance (MAB) requirement for new savings account holders has sparked a wave of discussions across India. Effective August 1, 2025, the bank has rolled out one of the steepest hikes in recent years, impacting customers across metro, urban, semi-urban, and rural branches.
This change is particularly notable because it comes at a time when many other banks are relaxing or even removing minimum balance requirements. So, why is ICICI going the other way, and what does it mean for you? Let’s break it down.
Revised Minimum Balance Requirements – The New Norms
If you plan to open a new savings account with ICICI Bank after August 1, 2025, here’s what you’ll need to maintain:
- Metro & Urban branches: ₹50,000 (earlier ₹10,000)
- Semi-urban branches: ₹25,000 (earlier ₹5,000)
- Rural branches: ₹10,000 (earlier ₹2,500 or ₹5,000, depending on the branch)
Note: These changes apply only to new customers. Existing account holders will continue with the old minimum balance rules.
Penalties for Falling Short
Failing to maintain the required MAB could cost you. ICICI Bank will charge the lower of:
- 6% of the shortfall amount
- ₹500
Good news for senior citizens: Pensioners are exempt from these penalties, offering them some relief amidst the changes.
Why ICICI Bank is Making This Move – Strategic Shift
This hike is not just about numbers — it’s about positioning. ICICI Bank seems to be shifting its focus towards a premium customer base that can maintain higher balances, potentially offering them more exclusive banking benefits.
Interestingly, this goes against the trend in public sector banks like SBI, Canara Bank, and Bank of Baroda, which have removed MAB requirements entirely to promote financial inclusion.
New Service Charges – Not Just About the Balance
Along with the MAB hike, ICICI Bank has also updated its cash transaction policy:
- Free cash deposits/withdrawals per month: 3 transactions
- Beyond the limit: Additional charges apply
This means customers will need to plan their cash transactions more carefully to avoid paying extra.
Public Reaction – A Mixed Bag
The new policy has divided opinion:
- Criticism: Many call the move “elitist” and worry about its impact on customers in semi-urban and rural areas, where incomes may not allow for such high balances.
- Support: Others see it as a bold strategy to differentiate ICICI Bank from competitors, offering a more premium banking experience.
What Are Your Alternatives?
If the new minimum balance sounds too high, you still have options:
- Basic Savings Accounts: These accounts often have zero or low balance requirements.
- Switch to Banks with No MAB Policy: Several public and private banks have scrapped minimum balance requirements altogether.
Key Takeaways for Customers
- These rules apply only to new ICICI Bank savings accounts opened after August 1, 2025.
- Penalties are capped, but they can still be significant if you frequently fall short.
- Consider your transaction habits and monthly balance capacity before opening an account under the new terms.
Final Thoughts – What This Means for Banking in India
ICICI Bank’s revised minimum balance policy sets a new benchmark in India’s private banking sector. While it may attract high-net-worth customers, it also risks alienating everyday savers.
For prospective account holders, the message is clear: Do your homework, compare your options, and choose the account that matches your financial comfort zone.