Minimum Balance in Indian Banks: ICICI’s ₹50,000 Rule Sparks Nationwide Debate

What Happened?

India’s second-largest private bank, ICICI Bank, has sharply raised its minimum average monthly balance (MAMB) requirement for new savings accounts—from ₹10,000 to ₹50,000 in metro and urban branches, effective August 1, 2025.

This move has triggered widespread public backlash, reignited debates on financial inclusion, and prompted scrutiny from regulators and rival banks.

Breakdown of ICICI’s New Minimum Balance Rules

Metro/Urban Branches

• New Customers: ₹50,000
• Existing Customers: ₹10,000
• Semi-Urban Branches
• New Customers: ₹25,000
• Existing Customers: ₹5,000

Rural Branches

• New Customers: ₹10,000
• Existing Customers: ₹5,000

Penalty for Shortfall

6% of the deficit or ₹500, whichever is lower

Free Cash Deposits

Limited to 3 per month, up to ₹1 lakh total

Public Reaction: “Banking for the Rich?”

Social media erupted with criticism, calling the move “elitist” and “anti-poor.”

Many users pointed out that ₹50,000 exceeds the monthly income of most Indians, effectively excluding lower-income groups from mainstream banking.

One viral post read:  “In a country where 23 crore people live below the poverty line, ICICI thinks ₹50,000 is a ‘minimum’? Masterstroke!”Others defended the bank’s right to target premium customers, arguing that private banks are not obligated to serve all segments equally.

Regulatory Landscape: What RBI Allows

The Reserve Bank of India (RBI) does not cap minimum balance requirements for savings accounts.

However, it mandates that all banks offer “Basic Savings Bank Deposit Accounts” (BSBDAs) with zero balance and limited services for financially vulnerable customers.

Public sector banks like SBI, PNB, and Canara Bank have scrapped minimum balance penalties altogether to promote financial inclusion.

Comparison Across Major Banks

• ICICI Bank
  • Metro/Urban: ₹50,000
  • Semi-Urban: ₹25,000
  • Rural: ₹10,000
• HDFC Bank
  • Metro/Urban: ₹10,000
  • Semi-Urban: ₹5,000
  • Rural: ₹2,500
• Axis Bank
  • Metro/Urban: ₹12,000
  • Semi-Urban: ₹5,000
  • Rural: ₹2,500
• SBI
  • Zero minimum balance across all branches
• Canara Bank
  • Zero minimum balance across all branches

Why Did ICICI Do This?

Experts suggest the hike is driven by:

• Rising operational and tech costs
• Pressure on profit margins
• Shift in strategy to attract high-value customers
• Competition from mutual funds and fintech platforms
• What’s Next?

The move by ICICI may set a precedent for other private banks. While Kotak Mahindra Bank has publicly opposed such hikes, industry watchers are keenly observing HDFC and Axis Bank’s next steps. Meanwhile, calls for RBI intervention are growing louder, with many demanding a cap on minimum balance requirements to ensure banking remains accessible to all.