ICICI Bank has reduced its minimum average balance (MAB) requirements for new customers across categories, partially reversing a recent steep hike that had drawn strong criticism.
For metro and urban locations, the MAB has been cut to Rs 15,000 from Rs 50,000.
In semi-urban areas, the requirement has been lowered to Rs 7,500 from Rs 25,000, while in rural areas it has been brought down to Rs 2,500 from Rs 10,000.
The revised MAB for new urban customers, however, remains Rs 5,000 higher than the earlier Rs 10,000 threshold.
The changes do not apply to salary accounts, which continue to have separate terms.
For customers who fail to meet the required MAB, the bank will impose a penalty of 6 per cent of the shortfall or Rs 500, whichever is lower.
The announcement comes just days after the country’s second-largest private lender raised the MAB for new urban customers from Rs 10,000 to Rs 50,000, a move that stood in contrast to other banks that have eased their requirements in recent years.
Social media users had condemned ICICI Bank’s decision to raise the MAB requirement for its savings accounts as both exclusionary and unfair.
Several accused the bank of “trying to become an elite bank,” calling the move “ridiculous” and “the worst decision of ICICI Bank.”
Reserve Bank of India Governor Sanjay Malhotra on Monday said banks are free to decide the minimum balance for savings accounts and that it does not fall under the regulatory domain of the RBI.
In 2020, State Bank of India scrapped its minimum balance rule.
Most other lenders currently maintain thresholds between Rs 2,000 and Rs 10,000. For existing ICICI Bank customers in rural and semi-urban areas, the MAB remains unchanged at Rs 5,000.
