ICICI Bank, India’s second-largest private lender, has announced a significant increase in the minimum monthly average balance (MAB) requirement for all new savings accounts opened from August 1, 2025. The move, which also comes with a revision of cash transaction service charges, has sparked intense criticism from customers who claim the decision favors only the wealthy.
What Has Changed in ICICI Bank’s Minimum Balance Rules?
According to the bank’s official website, the revised rules apply to all accounts opened on or after August 1, 2025 across metro, urban, semi-urban, and rural branches.
Here’s the new structure:
| Location | Previous MAB | New MAB (From Aug 1, 2025) |
|---|---|---|
| Metro / Urban | ₹10,000 | ₹50,000 |
| Semi-Urban | ₹5,000 | ₹25,000 |
| Rural | ₹2,500 | ₹10,000 |
| Old Rural Accounts | ₹2,500 | ₹5,000 |
| Old Semi-Urban | ₹5,000 | ₹5,000 |
This change makes ICICI Bank the domestic bank with the highest minimum balance requirement in India for new accounts.
Penalties for Non-Compliance
ICICI Bank has stated that customers who fail to maintain the required minimum balance will face a penalty of:
- 6% of the shortfall amount or
- ₹500, whichever is lower.
For example:
If a metro account holder maintains only ₹30,000 instead of ₹50,000, the shortfall is ₹20,000.
6% of ₹20,000 = ₹1,200. Since this exceeds ₹500, the penalty charged will be ₹500.
Why Did ICICI Bank Raise the Minimum Balance?
While the bank has not issued a detailed public explanation, industry experts say that minimum balance rules are usually meant to:
- Cover operational and maintenance costs of bank accounts.
- Ensure a steady cash flow for investments and lending.
- Discourage dormant accounts that are expensive for banks to maintain.
However, critics argue that the steep jump — a 400% increase for metro customers — is far beyond operational necessity and may discourage middle and lower-income customers from opening new accounts.
Public Backlash and Social Media Reactions
The decision has triggered outrage among customers on X (formerly Twitter), Facebook, and Instagram.
Some have accused the bank of “filtering customers based on wealth” while others labeled the move “elitist.” Several users tagged the Reserve Bank of India (RBI), urging the regulator to intervene and set an upper limit on minimum balance requirements.
Comments like:
- “This is banking for the rich, not for the common man.”
- “RBI should step in before other banks follow suit.”
…have been widely shared and discussed.
Impact on New Customers
For those planning to open a new ICICI Bank savings account, here’s what it means:
- Metro & Urban Customers: Must now keep ₹50,000 at all times in their account.
- Semi-Urban Customers: The requirement has jumped from ₹5,000 to ₹25,000.
- Rural Customers: The requirement is now ₹10,000, up from ₹2,500.
This amount must be maintained as a monthly average, meaning it can go up or down during the month, but the average daily balance over the month must meet the set figure.
Changes in ICICI Bank’s Service Charges
Along with the MAB hike, ICICI Bank has revised its service charges for cash transactions:
- Cash Deposit Rules:
- First 3 deposits in a month into a savings account are free.
- Monthly free deposit limit: ₹1 lakh.
- After this limit: ₹150 per transaction or ₹3.50 per ₹1,000 deposited (whichever is higher).
- Third-Party Deposits:
- Capped at ₹25,000 per transaction.
Why Customers Are Calling It ‘Elitist’
- Highest MAB in the Industry: No other private or public bank in India currently demands ₹50,000 for new accounts in metro areas.
- Wider Wealth Gap: Critics say such policies may exclude lower-income citizens from formal banking.
- Competitive Disadvantage: Some analysts believe this may push cost-conscious customers toward banks with lower MAB requirements.
What the Reserve Bank of India Says
The RBI allows banks to set their own minimum balance and penalty charges, but mandates that these should be reasonable and communicated clearly to customers before account opening.
Industry observers say it will be interesting to see if the RBI steps in if public pressure continues
Expert Opinion – Should You Still Open an ICICI Bank Account?
Banking experts advise customers to consider the overall benefits before rejecting an account purely on MAB grounds:
- ICICI Bank offers strong digital banking services and a wide ATM/branch network.
- Interest rates on savings accounts remain competitive.
- Premium benefits may appeal to high-income individuals who can easily maintain the required balance.
However, for those unable to maintain ₹50,000 consistently, public sector banks or smaller private banks may offer more affordable account options.
The ICICI Bank minimum balance hike is a bold and controversial move that sets a new benchmark in India’s banking sector. While it may enhance the bank’s profitability and target high-value customers, it risks alienating a large section of middle and lower-income account holders.
Whether this will become an industry trend or a customer backlash case study will depend largely on how regulators, competitors, and customers respond in the coming months.