Minimum balance charges levied by public and private sector lenders remain a debate in the banking corridors. RBI guidelines mention that banks can decide their own minimum balance and related charges.
However, there are also zero-balance accounts of banks that don't require any minimum threshold.
Minimum balance in savings account 2026
A minimum balance refers to the lowest amount customers must keep in their savings account to avoid penalties. The minimum balance requirement varies across banks, account types and locations. While many public sector banks have removed penalties for failing to maintain a minimum balance, many private banks still require their customers to maintain a minimum balance. Failing to maintain this limit attracts penalties.
Why do banks charge for low balances?
There are operational costs associated with several banking services such as ATMs, mobile banking and customer support. Banks must maintain infrastructure, pay staff and ensure the seamless operation of digital services. By requiring customers to maintain a minimum balance, banks ensure that your account helps pay for these costs. Banks impose a penalty to make up for the shortfall when your balance falls below the set minimum.
How maintaining minimum balance benefit customers?
Maintaining the required balance is important for several reasons. It helps prevent recurrent penalty charges which can reduce savings over time. It also ensures continuous access to banking services as some banks may restrict transactions if a minimum balance is not maintained. It promotes better financial discipline by encouraging people to maintain a liquidity buffer.
RBI rules on minimum balance
The Reserve Bank of India (RBI) has not issued any guidelines regarding the minimum balance to be maintained in savings bank accounts. RBI allows banks to set their own minimum balance requirements. However, the RBI has advised banks to inform customers regarding the minimum balance requirement at the time of account opening and intimate to the account holders about any subsequent changes in that regard.
Minimum balance in different banks
Numerous public sector banks have removed penalties for non-maintenance of minimum balance. State Bank of India, Punjab National Bank, Canara Bank and Indian Bank do not charge penalties for not maintaining a minimum balance.
Minimum balance requirements of top banks in India are
Union Bank of India's rural requirement is Rs 100-Rs 250 and urban/metro is Rs 500-Rs 1000.
HDFC rural requirement is Rs 2500 and urban/metro is Rs 10000
ICICI rural requirement is Rs 2500 and urban/metro is Rs 15000
Axis Bank's rural requirement is Rs 2500 and urban/metro is Rs 12000
Bank of Baroda's rural requirement is Rs 500 and urban/metro is Rs 2000
Jan Dhan account
Accounts such as Basic Savings Bank Deposit Accounts (BSBDAs), including Jan Dhan accounts, do not require any minimum balance and don't attract penalties.
Minimum balance maintenance
Maintaining a minimum balance in your savings account is more than just following rules. It's a strategic way to avoid penalties, access premium banking perks and promote financial discipline.