Context:
ICICI Bank, one of India’s leading private sector banks, has revised the minimum average balance (MAB) requirements for new savings accounts opened on or after August 1, 2025. This move marks a significant increase in the MAB norms for urban and semi-urban branches, reflecting a strategic shift in customer segmentation.
Key Highlights:
- Revised MAB Limits:
- Urban branches: â‚ą50,000 (previously â‚ą10,000)
- Semi-urban branches: â‚ą25,000
- Rural branches: â‚ą10,000 (unchanged)
- RBI’s Stance:
- The Reserve Bank of India clarified that MAB policies fall under the discretion of individual banks, and RBI does not regulate minimum balance requirements.
Minimum Average Balance (MAB)
Minimum Average Balance (MAB) is the minimum amount of money that a bank requires a customer to maintain in their savings or current account over a specified period (usually a month or quarter). It is the average of the daily closing balances during that period.
Purpose
- The increased MAB is seen as a move to prioritize high-value customers and optimize operational efficiency.
- Ensures that customers maintain a certain level of funds in their accounts to cover bank operational costs.
- Helps banks manage liquidity and operational expenses.
