Big relief for savings accountholders: After SBI and Canara Bank, PNB removes minimum balance charge

After State Bank of India (SBI) and Canara Bank, state-owned Punjab National Bank (PNB) will also no longer charge penalties for failing to maintain the minimum average balance (MAB) in all savings accounts. PNB has also reduced the interest rates on savings accounts across all balance slabs.

"This customer-first initiative (waiver of charges for non-maintenance of MAB), effective from July 1, 2025, aims to support priority segments, including low-income households, women, and farmers, by making banking services more accessible and easier to use without the burden of balance maintenance penalties," PNB said in a release.
SBI has waived the requirement for maintaining a minimum balance in all savings accounts since 2020; there is no penalty if the minimum balance in the savings account is not maintained.


Also read: No more penalty for low balance in bank account: Canara Bank ends minimum balance rule on all savings accounts from this date

In May 2025, Canara Bank also announced a waiver of the average monthly balance (AMB) requirement for all types of savings bank accounts, including regular savings accounts, salary accounts, and NRI savings accounts.

What is the average monthly balance requirement in a savings bank account?

The average monthly balance (AMB) is the minimum balance that a customer is required to maintain in his/her bank account. If the balance in the bank account falls below the required amount, then banks levy a penalty for failing to maintain AMB. The penalty varies based on the type of savings account.

Punjab National Bank
At PNB, charges for the non-maintenance of MAB were previously directly proportional to the extent of the shortfall, which means the penalty was calculated as a percentage of the shortfall from the required minimum balance.

Area	Min. applicable Charges	Max. applicable Charges	%age of shortfall
Rural	Rs. 1/-	Rs. 30/-	6%
Semi Urban	Rs. 1/-	Rs. 60/-	6%
Urban & Metro	Rs. 1/-	Rs. 100/-	5%

Punjab National Bank savings account interest rates

Small and medium account holders of PMB with deposits below Rs 100 crore will now earn 2.50% per annum, down from the earlier rates of 2.70% or 2.75%. Even large institutional depositors (Rs100 crore and above) will see a reduced rate of 2.70%, compared to 3.00% earlier. The new rates are applicable from July 1, 2025.

Saving Deposit Interest Rate
	Existing w.e.f. 01.01.2023	Revised w.e.f. 01.07.2025
Saving Fund Account Balance below Rs.10 Lakh	2.70 % p.a.	2.50% p.a.
Saving Fund Account Balance of Rs.10 Lakh to less than Rs.100 Crore	2.75 % p.a.	2.50% p.a.
Saving Fund Account Balance of Rs.100 Crore & above	3.00 % p.a.	2.70% p.a.

Source- Bank website