Minimum Balance Rules: Here's How Much Top Banks Charge For Non-Compliance
Most of the banks in the country require customers to maintain a certain Monthly Average Balance or MAB in their savings bank accounts, failing which they have to bear certain penalty charges. Monthly Average Balance (MAB) is the sum of all the end of day (EOD) closing balance divided by the number of days in that month. Leading lenders such as State Bank of India (SBI), HDFC Bank, ICICI Bank and Kotak Mahindra Bank have fixed their monthly average balance requirements according to the location of a customer's account and charge customers for non-maintenance of minimum average balance in their savings accounts.
Given below are the AMB requirements and penalty charges levied for non-maintenance of AMB by SBI, HDFC Bank, ICICI Bank and Kotak Mahindra Bank:
State Bank of India (SBI)
Customers with a regular savings account in SBI branches located in metro and urban areas need to maintain a monthly average balance of Rs 3,000, according to the bank's website - sbi.co.in. Customers with accounts in semi-urban branches and rural branches are required to maintain an MAB of Rs 2,000 and Rs 1,000 respectively, noted SBI.
Customers failing to meet the MAB requirements have to bear the following penalty charges:
| Metro and urban branch (required MAB Rs 3,000) | Charges |
|---|---|
| Shortfall <= 50% | Rs. 10 + GST |
| Shortfall > 50-75% | Rs. 12 + GST |
| Shortfall > 75% | Rs. 15 + GST |
| Semi-urban branch (required MAB Rs 2,000) | |
| Shortfall <= 50% | Rs 7.50 + GST |
| Shortfall > 50-75% | Rs 10 + GST |
| Shortfall > 75% | Rs.12 + GST |
| Rural (required MAB Rs 1,000) | |
| Shortfall <= 50% | Rs 5 + GST |
| Shortfall > 50-75% | Rs. 7.50 + GST |
| Shortfall > 75% | Rs 10 + GST |
(As mentioned on SBI's official website)
HDFC Bank
Customers with a regular savings account in HDFC branches located in metro and urban areas need to maintain a monthly average balance of Rs 10,000, according to the bank's website - hdfcbank.com. Customers with accounts in semi-urban branches and rural branches are required to maintain an MAB of Rs 5,000 and Rs 2,500 respectively.
Customers failing to meet the MAB requirements have to bear the following penalty charges:
| Description of Charges | Regular Savings Account | ||
|---|---|---|---|
| Minimum Average Balance Requirements | Metro / Urban branches: AMB Rs.10,000/-, | ||
| Semi-Urban Branches: AMB Rs.5,000/- , | |||
| Rural Branches: AQB Rs.2,500/- or Fixed Deposit of Rs. 10,000 for minimum 1 year 1 day period | |||
| Charges applicable on non-maintenance | Balance Non-Maintenance Charges* | ||
| AMB Slabs | Metro & Urban | Semi Urban | |
| (in Rs.) | AMB Requirement -Rs 10,000/- | AMB Requirement –Rs. 5,000/- | |
| >=7,500 to < 10,000 | Rs. 150/- | NA | |
| >=5,000 to < 7,500 | Rs. 300/- | NA | |
| >=2,500 to < 5,000 | Rs. 450/- | Rs. 150/- | |
| 0 to < 2,500 | Rs. 600/- | Rs. 300/- | |
| * plus taxes as applicable | |||
| AMB – Average Monthly Balance | |||
| AQB Slabs (in Rs.) | Balance Non-Maintenance Charges* (per quarter) - Rural Branches | ||
| >= 1000 < 2,500 | Rs. 270/- | ||
| 0 - <1000 | Rs. 450/- | ||
| *plus taxes as applicable | |||
| AQB – Average Quarterly Balance | |||
(As mentioned on HDFC Bank's official website)
ICICI Bank
Customers with a regular savings account in ICICI Bank branches located in metro and urban areas need to maintain a monthly average balance of Rs 10,000, according to the bank's website - icicibank.com. Customers with accounts in semi-urban branches and rural branches are required to maintain an MAB of Rs 5,000 and Rs 2,500 respectively.
Customers failing to meet the MAB requirements have to bear the following penalty charges:
| Minimum monthly average balance (MAB)* | Metro and Urban locations - Rs.10,000 |
|---|---|
| Semi-urban locations - Rs.5,000 | |
| Rural locations - Rs 2,000 | |
| Gramin locations - Rs.1,000 | |
| Charges for non maintenance of minimum monthly average balance (NMMAB) | Metro/Urban/Semi-Urban/Rural locations : |
| Rs. 100 + 5% of the shortfall in required MAB | |
| Gramin locations : 5% of the shortfall in required MAB |
(As mentioned on ICICI Bank's official website)
Kotak Mahindra Bank
Customers with a regular savings account in Kotak Bank branches located in metro and urban areas need to maintain a monthly average balance of Rs 10,000, according to the bank's website - kotak.com.
Customers failing to meet the MAB requirements have to bear the following penalty charges:
| Particulars | Charges | |
|---|---|---|
| NMC (Non Maintenance Charges) | If AMB <=25% of required Product AMB | Rs.500 |
| If Salary upload is not sighted for 2 consecutive months and AMB not maintained | If AMB >25% <=50% of required Product AMB | Rs.400 |
| If AMB >50% <= 75% of required Product AMB | Rs.300 | |
| If AMB >75% of required Product AMB but less than product AMB | Rs.150 |
However, there are certain accounts where MAB rules are not applicable. These accounts are called as zero balance savings accounts.