The change applies to all new accounts opened after that date, setting a new benchmark in the industry for the highest MAB requirement among domestic banks.
What is MAB and how is it calculated?
MAB is the minimum amount that an account holder should compulsory maintain in their Savings Account every month to avoid a penalty. In this requirement, you are not obliged to keep a specific amount in your account every single day, MAB is the average of your daily closing balances over the course of a calendar month.
For example, if a month has 30 days and the required MAB is ₹50,000, you don’t need to maintain ₹50,000 in your account every day. You could have a lower balance on some days as long as you have a higher balance on other days to ensure the total daily balances, when averaged out over the 30 days meet or exceed ₹50,000.
Revised structure
Under the revised structure of the ICICI bank, customers must maintain these figures in their savings account throughout the month:
- Rural areas: Accounts of such areas are now required to maintain ₹10,000, contrary to the prior requirement of just ₹2,500.
Penalty and non-compliance charges
If an account holder fails to maintain the required MAB under their category, the bank will impose a penalty fee. This fee is calculated based on the shortfall in the person’s balance and the specific policies of the bank.
In the case of ICICI Bank, the revised structure has mentioned that a shortfall in MAB will attract a penalty of 6 per cent or ₹500, whichever is lower. For example, a shortfall of ₹10,000 in a metro branch would ordinarily result in a ₹600 penalty, but under the new rules, the fee is capped at ₹500.
The private bank has also revised its cash transaction rules. Customers will get up to three free cash deposit transactions per month, totaling ₹1 lakh. Beyond this, charges of ₹150 per transaction or ₹3.50 per ₹1,000 deposited, whichever is higher will apply.
If both the transaction count and minimum balance are breached simultaneously, the higher of the two applicable charges will be imposed.
