ICICI Bank’s Rs 50,000 MAB Move: A Bold Bet Or Blunder?

ICICI Bank’s recent decision to raise the minimum average balance (MAB) for new savings accounts to ₹50,000 in metro and urban branches from August 1 has sparked widespread criticism. Social media users have slammed the move, with some calling it “daylight robbery” and others sarcastically suggesting ICICI believes India is already a $10 trillion economy. However, it’s important to note that ICICI is a private institution, not a public service entity. It has every right to set account conditions that align with its business goals. Customers who disagree have the freedom to switch banks.

This move reflects a clear shift toward premiumisation. ICICI appears to be targeting wealthier clients comfortable with higher balances. The new MAB requirements are ₹50,000 for metro branches, ₹25,000 for semi-urban, and ₹10,000 for rural areas— a significant jump from the previous ₹10,000, ₹5,000, and ₹2,500. Non-compliance results in penalties of either 6% of the shortfall or ₹500, whichever is lower.

Compared to other banks, ICICI is an outlier. Most public and private sector banks maintain far lower MAB requirements or have eliminated them altogether, prioritising financial inclusion over premium positioning. The public backlash was expected.