Be ready to maintain minimum account balance in SBI

India's largest bank, State Bank of India (SBI) has decided to increase manifold the minimum balance required for maintaining a savings account, effective from April 1. The biggest move by the public sector bank is going to hit 31 crore depositors, including pensioners and students.

As of now, MAB for a savings bank account is Rs 500 without the facility of a cheque book; and Rs 1000 with cheque book, applicable across the country. SBI has now decided to fix separate MABs for metro, urban, semi-urban and rural areas from start of FY18.

The monthly average balance (MAB) requirement has been increased to as high as Rs 5000 for branches in six metros. For urban and semi-urban branches, the MAB has been fixed at Rs 3000 and Rs 2000 respectively. In case of rural branches, the minimum balance has been fixed at Rs 1000.

At the same time, SBI and its five associates are going to merge on April 1. The savings bank account holders must maintain the monthly balance or else they will invite a penalty ranging from Rs 20 (rural branches) to Rs 100 in (metro cities).