Informist, Tuesday, Jul. 8, 2025

NEW DELHI – In a relief for customers, public sector banks have decided to waive penalty for not maintaining a minimum account balance, a senior finance ministry official said Tuesday. "Banks have themselves decided to get away with the concept of minimum account balances," the official told Informist, adding that it was not a government directive.

The move is aimed at giving a fillip to low-income customers who can continue to hold bank accounts without the compulsion of maintaining a minimum value. Earlier in the day, Bank of India announced that charges on non-maintenance of minimum balance across all savings bank account schemes will be waived with immediate effect. "This initiative eliminates penalties for non-maintenance, thereby reducing the financial burden on customers, increasing account flexibility, and enhancing overall customer satisfaction," the bank said.

Apart from Bank of India, Bank of Baroda, Indian Bank, Punjab National Bank and Canara Bank have also removed the penal charges for non-maintenance of a minimum average balance in all savings accounts. According to the official cited above, other state-owned banks are also in agreement with this move and will soon issue their respective directives.

The development comes after public sector banks at the end of last month discussed with Finance Minister Nirmala Sitharaman ways to mobilise deposits and onboard more customers. Sitharaman had also told these banks to onboard more customers into government-sponsored schemes, for which non-minimum balance bearing bank accounts will be very useful. End

Reported by Priyasmita Dutta

Edited by Tanima Banerjee

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