ICICI Bank, India’s second-largest private sector lender, has announced a substantial revision in its savings account requirements, marking a significant shift in the domestic banking landscape. Effective August 1, 2025, the bank will sharply increase the minimum monthly average balance (MAB) for all new accounts. This change positions ICICI Bank as the institution with the highest MAB requirement among Indian banks, signaling a decisive tilt toward attracting a premium customer base.
Under the revised norms, customers in metro and urban branches will need to maintain a monthly average balance of ₹50,000, a sharp jump from the current ₹10,000. Semi-urban branches will see their MAB requirement rise from ₹5,000 to ₹25,000, while rural branch customers will have to keep ₹10,000, up from ₹2,500. Existing customers are not affected by the revision for now, but the move sets a precedent that may influence other banks’ policies in the near future.
Non-compliance will attract a penalty of 6% of the shortfall in MAB or ₹500, whichever is lower. For instance, in a metro branch, a shortfall of ₹10,000 would typically result in a ₹600 penalty, but the revised rules cap it at ₹500. Alongside this change, the bank has altered its cash transaction policies. Customers will now have three free cash deposit transactions per month, up to a total value of ₹1 lakh. Beyond that limit, fees of ₹150 per transaction or ₹3.50 per ₹1,000 deposited, whichever is higher, will apply. If both transaction count and value thresholds are crossed, the higher charge will be levied. Third-party cash deposits will be limited to ₹25,000 per transaction. Cheque return fees have also been revised to ₹200 for outward returns and ₹500 for inward returns due to insufficient funds.
Compared to its peers, ICICI’s revised MAB requirements far exceed industry norms. HDFC Bank, for example, continues to require ₹10,000 in metro and urban branches, ₹5,000 in semi-urban areas, and ₹2,500 in rural areas. The State Bank of India scrapped its minimum balance requirement in 2020. Analysts view ICICI’s move as part of a broader premiumisation strategy, targeting high-net-worth individuals and mass-affluent customers who are more likely to engage in cross-selling opportunities for products like insurance, investment portfolios, and brokerage services.
This development comes against the backdrop of falling interest rates on savings deposits. In April 2025, ICICI reduced interest rates by 0.25 percentage points, with balances up to ₹50 lakh earning 2.75% and those above ₹50 lakh earning 3.25%. The revision aligned with similar moves by HDFC Bank and Axis Bank after consecutive rate cuts by the Reserve Bank of India. While the shift toward premium customers may strengthen the bank’s profitability, it could also widen the gap in financial access, particularly for middle-income and rural customers who may now find ICICI’s offerings less attractive.
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