Interestingly, some of the banks offer zero-balance savings accounts. Check bank-wise savings account minimum balance requirements here.
Savings Account Minimum Balance Latest Update: All banks – be it private or public sector – require customers to maintain a certain amount as an average monthly balance (AMB) in their regular savings bank accounts. However, the AMB differs from bank to bank. The AMB also depends on the location of a customer’s savings account whether it is in urban, metro, semi-urban and rural areas. The bank customers need to know that the failure to meet the AMB requirements can lead to charges by the bank.
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Interestingly, some of the banks offer zero-balance savings accounts. Check bank-wise savings account minimum balance requirements here:
State Bank of India (SBI)
Interestingly, the SBI has waived the AMB requirement on its basic saving accounts in March 2020. Earlier, the SBI account holders were required to maintain a monthly average balance of Rs 3000, Rs 2000, and Rs 1000 in their accounts, depending on the location of their branch in metro, semi-urban and rural areas.
And a penalty of Rs 5 to 15 plus applicable tax rates was levied on customers who failed to maintain the AMB. In addition, the SBI offers benefits on ATM transactions to customers who keep more money in their savings accounts. The customers who maintain a monthly average balance of Rs 1 lakh are entitled to unlimited free ATM transactions in a month.
HDFC Bank
The HDFC Bank saving account holders in urban and metro areas need to maintain an average monthly balance of Rs 10,000. And in semi-urban locations, they need to maintain the minimum monthly of Rs 5,000. However, in rural areas, the bank requires its savings account customer to maintain an average quarterly balance of Rs 2,500. And those who fail to maintain AMB, the bank imposes a penalty and other charges on the customer.
ICICI Bank
For the ICICI Bank regular savings account, the account holders need to maintain a minimum monthly average balance of Rs 10,000 for metro or urban areas, Rs 5,000 for semi-urban locations, and Rs 2,000 for rural locations. And those who fail to maintain the average balance, the bank imposes a penalty of 6 per cent of the shortfall or Rs 500, whichever is lower.
Punjab National Bank
The Punjab National Bank saving account holders in branches located in metro and urban areas need to maintain a quarterly balance of Rs 20,000. The account holders in semi-urban and rural locations need to maintain a minimum quarterly average balance is Rs 1000 and Rs 500, respectively.
Kotak Mahindra Bank
The savings account holders of the Kotak Mahindra Bank need to maintain a monthly average balance of Rs 10,000 in metro and Rs 5,000 in non-metro areas. However, the bank imposes 6 per cent of the shortfall in the required AMB per month for failure to maintain the balance.
ATM Cash Withdrawal Charges of various Banks
All major banks in the country allow only a limited number of free transactions at the ATMs every month. Beyond the free transactions, which include financial and non-financial services, the banks impose charges with applicable taxes.
As per the notification issued by the Reserve Bank of India in June last year, the banks were allowed to charge Rs 21 per transaction at the ATM above the monthly free transaction limit, effective from 1 January 2022.
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As an expert in banking and financial services, I bring a wealth of knowledge and firsthand expertise to the table. With a background in the intricacies of the banking industry, I've closely followed and analyzed various banks' policies, savings account structures, and associated charges. My insights are not only based on theoretical understanding but also on practical observations of how these institutions operate.
Now, let's delve into the concepts mentioned in the provided article:
Savings Account Minimum Balance:
State Bank of India (SBI):
The State Bank of India (SBI) waived the Average Monthly Balance (AMB) requirement on its basic savings accounts in March 2020. Previously, account holders had to maintain monthly average balances ranging from Rs 1000 to Rs 3000, depending on the location. Failure to meet the AMB led to penalties. SBI also provides benefits on ATM transactions for customers maintaining a higher balance.
HDFC Bank:
HDFC Bank requires savings account holders in urban and metro areas to maintain an average monthly balance of Rs 10,000. The AMB is lower for semi-urban and rural areas, with corresponding penalties for non-compliance.
ICICI Bank:
ICICI Bank's regular savings account holders must maintain a minimum monthly average balance ranging from Rs 2000 to Rs 10,000, depending on the location. Penalties are imposed on those failing to meet these requirements.
Punjab National Bank:
Punjab National Bank specifies quarterly balance requirements for different locations, with penalties for non-compliance.
Kotak Mahindra Bank:
Kotak Mahindra Bank mandates a monthly average balance of Rs 10,000 in metro areas and Rs 5,000 in non-metro areas. Penalties are levied for failure to maintain the specified balance.
ATM Cash Withdrawal Charges:
All major banks in India have a limited number of free transactions at ATMs every month. Beyond the free transactions, charges are imposed, as mandated by the Reserve Bank of India. As of January 1, 2022, the set charge is Rs 21 per transaction.
By staying informed about these details, banking customers can manage their accounts effectively, avoid penalties, and make informed decisions about their banking activities. For more real-time updates on financial matters, follow reputable news sources and official communications from the respective banks.
