Public in Shock: Bank Sets 25K Min Balance in Cities

HDFC Bank has announced an increase in the minimum average balance requirement for savings accounts in metro and urban areas, raising it from Rs 10000 to Rs 25000. This change is effective for customers who opened a savings account on or after August 1, 2025.

The decision follows a similar move by ICICI Bank, which recently raised its minimum average balance for metro and urban savings accounts from Rs 10000 to Rs 50000. Under the new HDFC Bank rules, account holders who fail to maintain the Rs 25000 minimum balance will face a penalty, calculated at 6 percent of the shortfall.

Existing HDFC Bank customers will not be affected by this change and can continue with their original account terms. Bank officials stated that the increase aims to improve service quality and strengthen deposit inflows. ICICI Bank’s updated rules also take effect from August 1, 2025, with the minimum average balance in semi-urban branches rising from Rs 5000 to Rs 25000, and in rural areas from Rs 5000 to Rs 10000.

These revised minimum balance requirements will not apply to salary accounts and Basic Savings Bank Deposit Accounts. While public sector banks like SBI, PNB, and Canara Bank have removed minimum balance requirements, private banks such as HDFC and ICICI are heading in the opposite direction.

Experts believe the increase in minimum balance and penalty charges will impact low-income individuals in metro and urban areas the most. Social media discussions highlighted that about 70 percent of job seekers earn between Rs 10000 and Rs 15000 monthly, which could result in economically weaker groups being excluded from private banking. With both HDFC and ICICI significantly increasing their thresholds, industry observers predict a major effect on banking accessibility for low-income customers in urban regions.