Joel Rebello

Mumbai: ICICI Bank has increased the minimum quarterly average balance required for its savings accounts to Rs 10,000, from the present Rs 5,000.

The increase, effective from July 1, will impact about 15% of the bank’s total accounts, Maninder Singh Juneja, head of retail liabilities, said.

“This is the first time we have done this in recent memory, mainly because infrastructure costs have gone up in the last few years. However, salary, senior citizens and no-frills accounts have been kept out,” Juneja said.

Juneja said that only 5-6% of the banks total accounts will have to change their balances to avoid being fined for not maintaining an average quarterly balance.

“It’s not that the balance has to be maintained on a daily basis. It’s only a quarterly average. Customers who have deposits coming in every month have been maintaining larger balances,” he said.

“In case the stipulated average balance does not meet the requirements of the customer, the customer can approach the bank to choose another product appropriate to their banking needs,” an ICICI spokesperson said.

Among private banks, only Kotak Mahindra Bank has a minimum balance requirement of Rs 10,000. Foreign banks in India also mostly require a balance of Rs 10,000.

But ICICI’s other private rivals — Axis Bank and HDFC Bank — have a minimum quarterly balance of Rs 5,000. Public sector banks have the lowest balance requirements, starting at Rs 500.

Bankers said ICICI must have analysed their accounts thoroughly before taking such a big step. “No bank will mind increasing their average balances. But you have to also take into account the number of customers and how to do it,” said an official from ING Vysya Bank.

Bankers said ICICI must have analysed their accounts thoroughly before taking such a big step. “No bank will mind increasing their average balances. But you have to also take into account the number of customers and how to do it,” said an official from ING Vysya Bank.

Source : DNA