No Charges On Zero Balance: This PSU Bank Removes Minimum Balance Rule From June 1
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Canara Bank levied charges if the minimum average monthly balance (AMB) is not maintained in a savings account like other public and private lenders.
Canara Bank has brought significant relief to its savings account holders by eliminating the average monthly balance (AMB) requirement for all types of savings bank accounts.
First Major Public Sector Bank to Remove AMB Charges
With this decision, Canara Bank becomes the first major public sector bank to abolish AMB-related penalties, allowing all savings account holders to maintain a zero balance without incurring any penalties. This initiative aims to enhance financial inclusion and improve customer convenience.
Accounts Benefited by the Waiver
The complete waiver will benefit various account holders, including those with savings accounts, salary accounts, and NRI SB accounts.
Implementation Date and Statement Starting June 1, 2025,
Canara Bank will establish itself as a leading public sector bank offering genuine no-penalty minimum balance requirements across a variety of savings bank accounts. This ensures that no savings bank customer will face charges for not maintaining a minimum balance in their accounts, as stated by the bank on Saturday.
Previously, customers had to maintain a minimum average monthly balance depending on their account type, failing which they incurred penalty charges. The new policy will allow all Canara Bank savings account holders to enjoy a true no-penalty policy for not maintaining a minimum balance.
To maintain an active savings account, account holders are required to adhere to a minimum balance based on the branch category. The Average Monthly Balance (AMB) varies according to the location of the branch — Rs. 2,000 for Urban/Metro branches, Rs. 1,000 for Semi-Urban branches, and Rs. 500 for Rural branches.
This move is expected to benefit millions of Canara Bank customers, including salaried individuals, senior citizens, students, NRIs, and first-time banking service users, facilitating everyday banking without penalties.
What Were The Charges For Not Keeping The Minimum Amount?
Canara Bank levies charges if the minimum average monthly balance (AMB) is not maintained in a savings account. The charges differ based on the type of branch—metro, urban, semi-urban, or rural. For metro and urban branches, customers are required to maintain an AMB of Rs 2,000. If the balance falls between Rs 1,999 and Rs 1,500, a charge of Rs 25 plus GST is applicable. If the AMB is between Rs 1,499 and Rs 1,000, the penalty increases to Rs 35 plus GST. For balances below Rs 1,000, a higher charge of Rs 45 plus GST is levied.
In semi-urban branches, the required AMB is Rs 1,000. If the AMB lies between Rs 999 and Rs 700, a fee of Rs 25 plus GST is charged. For balances ranging from Rs 699 to Rs 400, the penalty is Rs 35 plus GST. If the average monthly balance drops below Rs 400, Canara Bank charges Rs 45 plus GST.
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