Even though the country’s largest public sector bank, SBI, removed the penalty for not maintaining the minimum balance in 2020, many big banks of the country, like ICICI, still require their customers to maintain a fixed minimum amount in the account. If you do not do this, you may have to pay a heavy penalty. You need to have this information so that you can save your money. Let us know what the rules are related to minimum balance in big banks like HDFC, Union Bank, and Axis Bank.
What is the minimum balance, and why is it important
Minimum balance means having a fixed average amount in your savings account every month. Banks fix this amount so that they can cover the cost of their banking services and facilities. If a customer does not maintain this fixed amount, then the banks impose a penalty on them.
What is the minimum balance required to be maintained in which bank
Every bank has its policy. The minimum balance also depends on the type of city in which your account branch is located. Let us understand the rules of major banks:
HDFC Bank
Metro and urban branches: ₹10,000
Semi-urban branches: ₹5,000
Rural branches: ₹2,500
Penalty: The bank can impose a maximum penalty of ₹600 for not maintaining the minimum balance.
Union Bank of India
Urban branches: ₹1,000 for accounts with cheque books, ₹500 for accounts without cheque books
Semi-urban branches: ₹500 for accounts with cheque books, ₹250 for accounts without cheque books
Rural branches: ₹250 for accounts with cheque books, ₹100 for accounts without cheque books
Axis Bank
Urban branches: ₹12,000
Semi-urban branches: ₹5,000
Rural branches: ₹2,500
What happens if you don’t maintain the minimum balance
If you don’t maintain the minimum balance in your account, banks charge a penalty based on your average monthly balance. This penalty is deducted directly from your account. If you fail to maintain the minimum balance consistently, it becomes an additional expense on your account, which slowly depletes your funds.
3 easy ways to avoid a minimum balance
- You can opt for a bank account that does not have a minimum balance requirement, such as Jan Dhan Yojana accounts.
- Always maintain a balance above the minimum amount in your account and check it regularly.
- Set an alert in your bank app to notify you when the minimum balance falls short.
With this information, you can now manage your bank account better and avoid unnecessary penalties.