ICICI Bank’s New Minimum Balance Policy

India’s second-largest lender, ICICI Bank, has announced a significant change in its savings account policy, effective from August 1. The bank has raised the monthly minimum average balance requirement for new customers across various segments. This move impacts customers based on their location, with those in metro and urban areas now required to maintain a Rs 50,000 monthly average balance to avoid penalties. This change is part of the bank’s strategy to streamline its customer base and enhance service efficiency.

Impact on Different Customer Segments

For new customers in semi-urban locations, the minimum average balance has been set at Rs 25,000. Meanwhile, rural customers opening new accounts will need to maintain a Rs 10,000 balance. However, existing customers in rural and semi-urban areas will continue with the previous requirement of Rs 5,000 per month. This tiered approach reflects ICICI Bank’s understanding of the diverse financial capabilities of its customer base.

Penalty and Transaction Charges

Customers failing to meet the minimum balance will incur a penalty of 6% of the shortfall or Rs 500, whichever is lower. Additionally, ICICI Bank offers three complimentary cash deposits per month; subsequent transactions will incur a fee of Rs 150 each. The cumulative value limit for these deposits is capped at Rs 1 lakh monthly.

Interest Rate Adjustments and Comparisons

In April 2025, ICICI Bank reduced its savings account interest rate by 0.25%, with accounts holding up to Rs 50 lakh now earning an interest rate of 2.75%. This adjustment aligns with the bank’s broader financial strategy amidst changing market conditions. Notably, this increase in minimum balance requirements contrasts with other banks like State Bank of India (SBI), which abolished its minimum balance rule in 2020.