No penalty on minimum balance: 6 banks that have removed savings accounts balance requirement

These bank customers need not worry about maintaining minimum balance in a savings account. Recently, some of the major publicly listed banks in India have removed the compulsory practice of keeping an Average Monthly Balance (AMB) thus removing all penalties for underperformance. PNB and other banks such as Bank of Baroda, Bank of India, Indian Bank, Canara Bank, have removed the minimal balance criteria on the majority and in some cases all of their savings accounts.

Average Monthly Balance (AMB)

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 the AMB. The penalty varies based on the type of savings account.

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Bank of Baroda

Bank of Baroda has announced an initiative by waiving charges on non-maintenance of minimum balance in all standard Savings Accounts, with effect from July 1, 2025. With this, customers will not incur any charges for any shortfall in the monthly average balance in their Savings Accounts. Note that the waiver is not applicable on Premium Savings Account schemes.

Bank of Baroda savings account interest rate

Present SB Interest Rate Slab on O/s Balance	Interest Rates
upto Rs. 1.00 Lakh	2.50%
Above Rs 1.00 Lakh to less than Rs. 50 Lakh	2.50%
Rs. 50 Lakh and less than Rs. 10 Crores	2.50%
Rs. 10 Crores and above to less than Rs. 50 Crores	2.50%
Rs. 50 Crores and above to less than Rs. 100 Crores	2.75%
Rs. 100 Crores and above to less than Rs. 200 Crores	2.75%
Rs. 200 Crores and above to less than Rs. 500 Crores	2.75%
Rs. 500 Crores and above to less than Rs. 1,000 Crores	3.50%
Rs. 1,000 Crores and above to less than Rs. 2,000 Crores	4.00%
Rs. 2,000 Crores and above	4.25%

Indian Bank
Indian Bank said that it will waive off minimum balance criteria and it has announced the complete waiver of minimum balance charges across all savings bank accounts. This will be effective from July 7, 2025.


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

Canara Bank savings account interest rates

S.No.	Slabs	ROI(%)
1	For outstanding Balance of less than Rs. 50 Lakh	2.55%
2	For outstanding Balance of Rs. 50 Lakh to less than Rs 5 Cr	2.55%
3	For outstanding Balance of Rs. 5 Cr to less than Rs 10 Cr	2.55%
4	For outstanding Balance of Rs. 10 Cr to less than Rs 100 Cr	2.55%
5	For outstanding Balance of Rs. 100 Cr to less than Rs 200 Cr	2.65%
6	For outstanding Balance of Rs. 200 Cr to less than Rs 300 Cr	2.65%
7	For outstanding Balance of Rs. 300 Cr to less than Rs 500 Cr	3.10%
8	For outstanding Balance of Rs. 500 Cr to less than Rs 1000 Cr	3.40%
9	For outstanding Balance of Rs. 1000 Cr & less than Rs. 2000 Cr	3.55%
10	For outstanding Balance of Rs. 2000 Cr & above	4.00%

PNB

Punjab National Bank (PNB) will also no longer charge penalties for failing to maintain the minimum average balance (MAB) in all savings accounts.

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.
PNB Savings account interest rates

PNB savings account interest rates

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

State Bank of India
SBI has waived off 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.

Bank of India
Bank of India has waived off minimum-balance penalties on savings accounts. These changes are aimed at aligning with market dynamics, enhancing financial flexibility, and delivering greater value to customers across segments, as per Bank of India press release.