‘Retrograde decision’: Civil society org writes to govt against ICICI Bank’s minimum balance hike

‘Bank Bachao Desh Bachao Manch’, a civil society organization, has written to the Finance Ministry to voice their strong opposition to ICICI Bank’s intention to raise the minimum average balance (MAB) requirement for new savings accounts.

They contended in their correspondence with the Finance Ministry that this action runs counter to the government’s goals of promoting inclusive banking and economic expansion. “Unjust and regressive” is how the organization characterized ICICI Bank’s decision. Customers in metro and metropolitan areas must maintain a minimum balance of Rs 50,000 as of August 1, 2025, per ICICI Bank’s new policy. This is a huge increase from the previous Rs 10,000 threshold. The standards have been increased to Rs 10,000 for rural areas and Rs 25,000 for semi-urban areas.

Joint conveners of the organisation Biswaranjan Ray and Soumya Datta criticised the new policy, stating, “This retrograde decision undermines the principle of inclusive banking.” The organisation has called for the immediate reversal of this decision, urging the government to safeguard depositors’ interests and promote wider financial inclusion.

Public sector banks have always maintained lower balance criteria for Jan Dhan accounts, and some have even waived them completely. Because of their dedication to inclusivity, several of these banks do not penalize clients for not maintaining the minimum balance, unlike ICICI. ICICI Bank presently has the highest minimum balance requirement among Indian banks as a result of its significant MAB rise. Leading rivals like HDFC Bank and State Bank of India, in contrast, have much lower criteria while still emphasizing cost control and client inclusion.

The move by ICICI Bank deviates significantly from industry patterns in which a number of banks have lowered deposit interest rates in order to cut operating costs. In response to the RBI’s rate cuts earlier this year, ICICI Bank lowered the interest rates on its savings accounts, following suit with HDFC and Axis Banks.