ndian Overseas Bank has announced that it will no longer charge penalties for not maintaining a Minimum Average Balance (MAB) in savings accounts.
The bank shared this update in a press release on Wednesday.
Earlier, the penalty waiver was available only for certain schemes, but now it has been extended to all savings account schemes.
This step has been taken to provide relief to account holders.
Purpose Behind the Decision
Managing Director and CEO, Ajay Kumar Srivastava, expressed his satisfaction with the change.
He explained that the decision reflects customer-focused banking and will make banking simpler for everyone.
Customers will now be able to use the bank’s services without worrying about MAB penalties.
However, the bank clarified that the existing rules will remain in place until September 30, 2025.
Until then, customers will continue paying the current charges. From October 1, 2025, the new rule of zero penalty will come into effect.
This move will be especially beneficial for small account holders and pensioners, who often face penalties due to lack of funds or awareness.
The bank believes this step will encourage more savings and make banking easier for all customers.
What is Minimum Average Balance (MAB)?
The Minimum Average Balance (MAB) is the minimum amount a customer must keep in their savings account during a month. If the balance falls below this level, the bank usually charges a penalty.
The required MAB amount can differ depending on the account type, scheme, and bank location, and it also varies from one bank to another.
