Bank account holders are required to maintain an average monthly balance (AMB) of a specific amount in their basic savings accounts. Though almost all the banks offer zero balance accounts, the facility is not available for all customers. Every bank has a unique AMB and the customers need to maintain the specified minimum balance in their savings account to avoid penalties.
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The AMB amount may differ depending on whether the consumer has a savings account in the branch located in an urban, metro, semi-urban, or rural area.
Here is a comparison of the average monthly rates of some of the top banks.
State Bank Of India (SBI)
The AMB requirement in SBI’s basic savings accounts was eliminated in March 2020. Before the modification, SBI account holders had to keep a monthly balance of Rs 3,000, Rs 2,000, or Rs 1,000 in their accounts in a metro area, a semi-urban area, or a rural area, respectively. A penalty between Rs 5 and Rs 15 was charged per month, if customers could not fulfill the AMB criteria. Customers who maintain a monthly average balance of one lakh rupees are eligible for an unlimited number of free ATM withdrawals each month.
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HDFC Bank
Savings account customers with HDFC bank are expected to maintain an average monthly balance of Rs 10,000 in urban areas and metro cities. The minimal monthly ceiling in semi-urban areas is set at Rs 5,000. Customers of the bank’s savings accounts in rural areas are required to keep an average quarterly balance of Rs 2,500. When AMB is not maintained, the bank imposes fines.
Holders of ICICI bank regular savings accounts must keep a minimum balance of Rs 10,000 in metro or urban areas, Rs 5,000 in semi-urban areas, and Rs 2,000 in rural areas every month. The bank charges a penalty for failing to maintain the average balance of 6% of the shortfall or Rs 500, whichever is lower. The fine will be applied to savings accounts at all branches worldwide.
Punjab National Bank
Savings account holders at Punjab National Bank branches in urban and suburban areas are required to keep a balance of Rs 20,000 on a quarterly basis. The minimum quarterly average balance is Rs 1,000 in semi-urban areas and 500 in rural areas, respectively.
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Kotak Mahindra Bank
Kotak Mahindra Bank savings account holders must keep an average monthly balance of Rs 10,000 in metro areas and Rs 5,000 in non-metro areas. For failure to maintain the balance, the bank imposes a monthly fee of 6% of the AMB deficiency amount.
