If your savings account balance dips below the required minimum, the bank can deduct a non-maintenance charge, typically between ₹5 and ₹600 a month, depending on the bank and the size of the shortfall. State Bank of India, Punjab National Bank, Bank of Baroda, Canara Bank, and Indian Bank have scrapped this charge entirely on regular savings accounts. HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank still levy it.
What Is a Non-Maintenance of Minimum Balance Charge
A non-maintenance charge, sometimes called an AMB charge or MAB penalty, is the fee a bank deducts when your savings account’s Average Monthly Balance (AMB) falls below the amount the bank requires for that account type and branch location. The bank calculates this average from your daily closing balances over the month, not from a single day’s balance. If the average comes in under the threshold, the shortfall attracts a charge, usually a percentage of the deficit, subject to a minimum and a maximum cap set by the bank’s own board-approved policy.
RBI’s Rules on Minimum Balance Penalties
The Reserve Bank of India does not fix a minimum balance amount or a penalty figure. Banks decide both on their own, within limits laid down by RBI circular RBI/2014-15/308 (DBR.Dir.BC.No.47/13.03.00/2014-15), dated November 20, 2014, effective April 1, 2015. Under this circular, banks must:
- Notify the customer by SMS, email, or letter when the balance falls short, and give at least one month to restore it before charging a penalty
- Set the charge as a fixed percentage of the shortfall (the gap between the actual balance and the required balance), following a board-approved slab structure, not a flat arbitrary fee
- Keep the charge reasonable and in line with the average cost of providing the service
- Never let the penalty push a savings account into a negative balance on its own
A bank that debits charges past the point where your account goes negative is violating this circular, and you can escalate the matter through the Reserve Bank Integrated Ombudsman Scheme.
Read more: How to Check Bank Balance Online
Which Banks Have Waived the Charge
Since 2020, a wave of public sector banks has dropped non-maintenance charges on regular savings accounts entirely:
- State Bank of India: waived from March 11, 2020, the first major bank to do so
- Canara Bank: waived across all savings account types from May 2025
- Bank of Baroda: waived on standard savings accounts from July 1, 2025 (premium savings schemes are excluded)
- Punjab National Bank: waived across all savings accounts from July 1, 2025
- Indian Bank: waived across all savings accounts from July 7, 2025
According to a reply given in the Rajya Sabha by the Minister of State for Finance, 10 of the country’s 12 public sector banks have discontinued the penalty on savings accounts, with the remaining two having only rationalised (not removed) their charge structure.
Private sector banks have not followed the same path. HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank continue to charge for non-maintenance of AMB on their standard savings accounts.
Bank-Wise Minimum Balance and Non-Maintenance Charges
| Bank | Regular Savings AMB (Metro/Urban) | Non-Maintenance Charge |
|---|---|---|
| State Bank of India | No requirement | Nil (waived since 11.03.2020) |
| Punjab National Bank | No requirement | Nil (waived since 01.07.2025) |
| Bank of Baroda | No requirement (standard accounts) | Nil (waived since 01.07.2025) |
| Canara Bank | No requirement | Nil (waived since May 2025) |
| Indian Bank | No requirement | Nil (waived since 07.07.2025) |
| HDFC Bank | ₹10,000 (or FD of ₹1 lakh, 1 year 1 day) | Percentage of shortfall on a slab basis, capped at ₹600 per month |
| ICICI Bank (existing customers) | ₹10,000 | 6% of the shortfall or ₹500, whichever is lower, plus GST |
| ICICI Bank (accounts opened after 01.08.2025) | ₹50,000 | 6% of the shortfall or ₹500, whichever is lower, plus GST |
| Axis Bank | Varies by account variant | Percentage of shortfall on a slab basis (confirm current slab on Axis Bank’s schedule of charges) |
| Kotak Mahindra Bank | Varies by account variant | Percentage of shortfall on a slab basis (confirm current slab on Kotak’s schedule of charges) |
Rural and semi-urban branches carry lower AMB requirements than metro and urban branches at every bank, and the shortfall charge scales down accordingly. Pensioner accounts, Basic Savings Bank Deposit Accounts (BSBDA), and Jan Dhan accounts are exempt from minimum balance rules at every bank, public and private.
Because private banks revise these slabs periodically, treat the Axis and Kotak figures above as directional. Confirm the exact numbers on the bank’s own schedule of charges page before making a decision based on them.
How Much Banks Actually Collect From This Charge
Non-maintenance charges are not a rounding error for the banking system. Per government data shared in Parliament, banks collected roughly ₹26,170 crore in minimum balance penalties between FY23 and FY26. In FY26 alone, the total was ₹7,086.63 crore, split between ₹2,137.92 crore from public sector banks and ₹4,948.71 crore from private banks.
HDFC Bank topped the private-sector list in FY26 at ₹1,798.14 crore, followed by Axis Bank at ₹1,081.33 crore. On the public sector side, SBI’s FY26 figure of ₹477.27 crore relates entirely to current accounts, since its savings account penalty has been waived since 2020, and Bank of Baroda collected ₹394.1 crore, mostly from premium savings variants that sit outside its 2025 waiver.
How the Shortfall Charge Is Calculated
Most banks that still levy this charge follow the same basic method:
- The bank averages your account’s daily closing balance across the month to arrive at the AMB.
- It subtracts the AMB from the required minimum to get the shortfall.
- It applies a fixed percentage (commonly around 6%) to that shortfall, subject to a floor and a ceiling defined in the bank’s schedule of charges.
- GST is added on top of the charge itself.
Because the calculation runs on the monthly average and not the lowest single-day balance, a temporary dip that you correct before the end of the month usually does not trigger a charge, as long as the average for the full month clears the threshold.
How to Avoid Non-Maintenance Charges
- Check whether your bank has already waived the charge. If you hold accounts with SBI, PNB, Bank of Baroda, Canara Bank, or Indian Bank, a shortfall in a regular savings account no longer costs you anything.
- Set up a standing instruction to auto-transfer a fixed sum from a salary or primary account into the savings account that carries a minimum balance requirement.
- Ask about a linked fixed deposit option. HDFC Bank, for instance, waives the AMB requirement if you hold a linked FD of ₹1 lakh for a minimum of one year and one day.
- Switch to a Basic Savings Bank Deposit Account (BSBDA) or a Jan Dhan account if you genuinely cannot maintain a balance. Both carry zero minimum balance requirements at every bank.
- Check your account’s transaction history through net banking or the app before the month closes, since most banks show your running AMB against the requirement in real time.
What Experts Say
Practitioners who track retail banking charges point out that the shortfall-percentage model, while RBI-compliant on paper, still lands hardest on customers who can least absorb it: those with fluctuating incomes, gig workers, and first-time account holders in semi-urban branches. The recent PSB waivers are widely read as a financial-inclusion move rather than a purely competitive one, since public sector banks serve a disproportionate share of low-balance accounts opened under government schemes. On the private-bank side, the argument for retaining the charge is usually cost recovery. Servicing a low-balance account, branch access, ATM network, statements, still costs the bank money, and the charge is framed as a way to price that cost rather than push it onto other customers through higher fees elsewhere.
Frequently Asked Questions
Which banks have waived minimum balance charges in 2025 and 2026? State Bank of India (since March 2020), Canara Bank (May 2025), Bank of Baroda on standard savings accounts (July 2025), Punjab National Bank (July 2025), and Indian Bank (July 2025) have all removed the charge on regular savings accounts. HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank continue to levy it.
Can my savings account balance go negative because of this charge? No. RBI’s guidelines specifically prohibit a bank from letting the penalty for non-maintenance of minimum balance push a savings account into a negative balance on its own. If this happens to you, you can raise the issue with the bank and, if unresolved, escalate it through the Reserve Bank Integrated Ombudsman Scheme.
Are Jan Dhan and Basic Savings Bank Deposit Accounts exempt from this charge? Yes. BSBDA and Pradhan Mantri Jan Dhan Yojana accounts carry no minimum balance requirement at any bank, public or private, so there is nothing to fall short of and no charge to levy.
How much notice must a bank give before charging the penalty? At least one month from the date the bank notifies you of the shortfall, by SMS, email, or letter, as set out in RBI circular RBI/2014-15/308.
Is the minimum balance calculated daily or as a monthly average? As a monthly average in almost all cases. Banks average your closing balance across every day of the month to arrive at the Average Monthly Balance (AMB), so a short-term dip that you correct before month-end usually will not trigger a charge on its own.
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