Banks Collected ₹7,086 Crore as Minimum Balance Penalties in FY26: Government Tells Parliament

1
Banks collected over ₹7,086 crore in FY26 as penalties for not maintaining the minimum average balance (MAB), the government told Parliament on 28 July 2026.
2
Private banks accounted for ₹4,948.71 crore and public sector banks (PSBs) for ₹2,137.92 crore.
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HDFC Bank collected the most (₹1,798.14 crore), followed by Axis Bank (₹1,081.33 crore); SBI led among PSBs (₹477.27 crore).
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Across FY23 to FY26, banks collected about ₹26,170 crore in such penalties.
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Ten of the 12 PSBs have scrapped penal charges for non-maintenance of minimum balance in savings accounts.

●Disclosed in: Rajya Sabha (written reply), 28 July 2026
●By: Pankaj Chaudhary, Minister of State for Finance
●FY26 minimum-balance penalties: over ₹7,086 crore
●Private banks: ₹4,948.71 crore; PSBs: ₹2,137.92 crore
●Top collector: HDFC Bank (₹1,798.14 crore); Axis Bank (₹1,081.33 crore)
●FY23-FY26 total: about ₹26,170 crore

HDFC Bank

₹1,798.14 crore

Axis Bank

₹1,081.33 crore

State Bank of India (top PSB)

₹477.27 crore

Bank of Baroda

₹394.10 crore

Indian Bank

₹299.17 crore

Minimum Average Balance (MAB) is the average balance a customer must keep in a savings or current account over a period; falling short triggers a penalty. The figures were shared in a written reply in the Rajya Sabha. The minister noted that of the 12 public sector banks, ten have scrapped penal charges for non-maintenance of minimum balance in savings accounts, while the remaining two revised such charges under board-approved policies.

Minimum-balance penalties fall disproportionately on lower-income and rural depositors, which is why they have drawn political and regulatory scrutiny. The data show private banks now collect the larger share, even as most public sector banks have dropped the charge — a notable divergence in how the two ownership groups treat small savers.

Exam Relevance

banking

Banking Awareness > Deposits & Charges

ssc

General Awareness > Economy

Expected Questions

★What does MAB stand for in banking?
★Which bank collected the most in minimum-balance penalties in FY26?

Key Terms

Minimum Average Balance (MAB)

The average balance a customer must maintain in an account; a shortfall attracts a penalty

priority_highMust Remember

•FY26 minimum-balance penalties: ₹7,086 crore; HDFC Bank highest; 10 of 12 PSBs have scrapped the charge on savings accounts

tips_and_updatesExam Tips

•Note the divergence: private banks collect the bulk of these penalties; most PSBs have dropped them.

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Factual

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Banks Collected ₹7,086 Crore as Minimum Balance Penalties in FY26: Government Tells Parliament

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Exam Relevance

Expected Questions

Key Terms

priority_highMust Remember

tips_and_updatesExam Tips

Practice Quiz

How much did banks collect in FY26 as penalties for non-maintenance of minimum balance, per the government?

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