Penalty Charges Levied By Top Banks For Non-Maintenance Of Minimum Balance

Penalty Charges Levied By Top Banks For Non-Maintenance Of Minimum Balance

Most banks in the country charge their customers a penalty fee for non-maintenance of monthly average balance (MAB) in their savings accounts. 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. These penalty charges levied by lenders for keeping insufficient bank balance in regular savings account depends on multiple factors, such as the location of bank branch and the degree of shortfall, meaning how far the actual bank balance is from the required average.

Given below are the MAB requirements and penalty charges levied for non-maintenance of MAB by SBI, HDFC Bank, ICICI Bank and Canara Bank:

State Bank of India (SBI)

Customers with a regular savings account in SBI branches located in metro and urban areas are required 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.

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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

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. 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, according to the bank’s website – hdfcbank.com.

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


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. 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, according to the bank’s website – icicibank.com.

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

Canara Bank

Customers with a regular savings account in Canara Bank branches located in metro, urban and semi-urban areas need to maintain a monthly average balance of Rs. 1,000. Customers with accounts in rural branches are required to maintain an MAB of Rs. 500, according to the bank’s website – canarabank.in.

Customers failing to meet the MAB requirements have to bear the following penalty charges:

Non maintenance of Minimum balance charges Modification in charges (Based on Minimum Average Monthly Balance-AMB)
a) METRO / URBAN / SEMI URBAN Branches b) RURAL BRANCHES
AMB maintained in the account against the stipulated Rs. 1,000/- Charges per month for violation of AMB AMB maintained in the account against the stipulated Rs. 500/- Charges per month for violation of AMB
Rs. 999/- to Rs. 700/- Rs. 25/- + applicable Service Tax Rs. 499/- to Rs. 350/- Rs. 25/- + applicable Service Tax
Rs. 699/- to Rs. 400/- Rs. 35/- + applicable Service Tax Rs. 349/- to Rs. 200/- Rs. 35/- + applicable Service Tax
Rs. 399/- and below Rs. 45/- + applicable Service Tax Rs. 199/- and below Rs. 45/- + applicable Service Tax

However, there are certain accounts where MAB rules are not applicable. These accounts are called as zero balance savings accounts.

Source:- ndtv
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