ICICI Bank minimum balance reduced 2025 after public outrage. Learn about revised MAB for urban, semi-urban, and rural accounts and implications for banking policies.
ICICI Bank Reduces Minimum Balance Requirement After Public Outrage
ICICI Bank, India’s second-largest private sector lender, has revised its minimum average balance (MAB) requirement for new savings account holders following widespread criticism. The bank had previously raised the MAB from ₹10,000 to ₹50,000 for new customers in urban areas. However, due to public backlash, the bank has now reduced the MAB for urban customers to ₹15,000. The revised MAB for semi-urban areas is ₹7,500, down from ₹25,000, and for rural areas, it is ₹2,500, reduced from ₹10,000. Existing customers in rural and semi-urban areas will continue to have an MAB of ₹5,000.
Why This News Is Important
Impact on Customers
The initial hike in MAB to ₹50,000 was met with strong opposition from customers, especially those in urban areas. Many felt that the increased requirement was burdensome and inaccessible, particularly for low-income individuals and new account holders. The subsequent reduction in MAB demonstrates the bank’s responsiveness to customer concerns and its commitment to making banking more inclusive.
Comparison with Other Banks
ICICI Bank’s revised MAB is still higher than those of some other major banks. For instance, the State Bank of India (SBI) eliminated its minimum balance requirement in 2020, setting a precedent for customer-friendly banking policies.
Regulatory Oversight
The Reserve Bank of India (RBI) has clarified that the decision to raise the MAB was entirely that of ICICI Bank and did not involve the central bank’s intervention. The RBI emphasized the importance of transparency and customer-centric policies in the banking sector.
Historical Context
Minimum balance requirements have been a standard practice among Indian banks to ensure that account holders maintain a certain level of funds. However, these requirements have often been a point of contention, especially when they are perceived as too high. In recent years, there has been a growing trend towards eliminating or reducing MAB requirements to promote financial inclusion. The RBI’s stance on this issue has been to encourage banks to adopt customer-friendly policies while ensuring financial stability.
Key Takeaways from ‘ICICI Bank Reduces Minimum Balance Requirement After Public Outrage’
| S.No | Key Takeaway |
|---|---|
| 1 | ICICI Bank reduced its MAB for urban areas to ₹15,000 after customer feedback. |
| 2 | The revised MAB for semi-urban and rural areas is ₹7,500 and ₹2,500, respectively. |
| 3 | Existing customers in rural and semi-urban areas maintain an MAB of ₹5,000. |
| 4 | The Reserve Bank of India clarified that the MAB hike was ICICI Bank’s decision, not the RBI’s. |
| 5 | The move reflects the bank’s responsiveness to public concerns and commitment to inclusivity. |
FAQs: Frequently Asked Questions
1. What is the new minimum average balance (MAB) for ICICI Bank urban accounts?
The revised MAB for urban accounts is ₹15,000 after public backlash.
2. How much is the MAB for semi-urban and rural accounts?
For semi-urban accounts, it is ₹7,500, and for rural accounts, it is ₹2,500.
3. Are existing customers affected by this change?
Existing customers in rural and semi-urban areas continue with an MAB of ₹5,000; the change primarily affects new account holders.
4. Why did ICICI Bank reduce the MAB?
The bank reduced the MAB following widespread public outrage and criticism over the initial hike, demonstrating responsiveness to customer feedback.
5. Does RBI set the minimum balance requirements for banks?
No, the RBI does not set minimum balance rules; ICICI Bank independently decided to revise its MAB.
6. How does this decision compare with other major banks?
Some banks, like SBI, have eliminated MAB requirements entirely, promoting more inclusive banking.
7. Why is this news important for government exam aspirants?
This news is relevant because banking policies, financial inclusion, and regulatory responses are common topics in exams like IBPS, RBI, SSC, UPSC, and state PSCs.
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