Banks collected more than ₹26,170 crore from customers as penalties for failing to maintain the minimum average balance (MAB) in their accounts over the four financial years from FY23 to FY26, according to a written reply by Minister of State for Finance Pankaj Chaudhary in the Rajya Sabha. The data, compiled from public sector banks and the Reserve Bank of India (RBI), shows private lenders accounted for the larger share of these collections.
In FY26 alone, banks collected ₹7,086.63 crore through minimum balance charges. Private sector banks accounted for ₹4,948.71 crore, more than twice the ₹2,137.92 crore collected by public sector banks (PSBs).
HDFC Bank tops private lenders, SBI leads PSBs
Other major private banks included ICICI Bank ( ₹353.50 crore), Kotak Mahindra Bank ( ₹290.65 crore), Yes Bank ( ₹195.05 crore) and IDBI Bank ( ₹175.15 crore). The RBI noted that data for private banks before FY23 is not maintained, while FY26 figures are provisional.
Among public sector lenders, State Bank of India (SBI) reported the highest collection at ₹477.27 crore, followed by Bank of Baroda ( ₹394.10 crore) and Indian Bank ( ₹299.17 crore). However, the government clarified that SBI's figure pertains to current accounts, as the bank has waived minimum balance penalties on savings accounts since March 2020.
Zero-balance accounts remain exempt
According to the government, around 73 crore BSBDAs, including PMJDY accounts, are currently exempt from any penalty for non-maintenance of minimum balance.
The ministry also said RBI allows banks to levy minimum balance charges on other savings and current accounts under their board-approved policies, provided the charges are reasonable, transparent and commensurate with the cost of providing banking services. Banks are also required to notify customers through SMS, email, letter or other appropriate means and generally provide them time to restore the required balance before penalties are imposed.