New Delhi: Canara Bank has announced the removal of penalties for failing to maintain a minimum balance in savings accounts, effective June 1.
With this decision, all categories of savings account holders will no longer be charged for maintaining a low or zero balance. The bank becomes the first major public sector lender to eliminate this requirement across the board.
Account holders can now operate their savings accounts freely without worrying about penalties, a move expected to benefit millions by granting greater financial flexibility.
"From June 1, 2025, Canara Bank will not impose any penalty for non-maintenance of minimum balance. This applies to all savings account holders,” the bank said in a statement on social media platform X.
“With this new policy, all Canara Bank savings bank account holders will now enjoy true ‘no penalty on minimum balance’ for all savings bank accounts free from any average monthly balance-related penalties or fees,” it said.
Previously, Canara Bank required customers to maintain a minimum balance of Rs 2,000 in urban areas, Rs 1,000 in semi-urban areas, and Rs 500 in rural areas. Failure to meet these thresholds would result in penalties.
The removal of the minimum balance requirement is expected to benefit a diverse customer base, including students, women, senior citizens, and individuals from low-income groups.
Canara Bank, one of India's largest public sector banks, reported an income of Rs 31,496 crore and a profit of Rs 5,111 crore in Q4 of FY25.
For the full financial year, the bank recorded a total income of Rs 1.21 lakh crore, with a net profit of Rs 17,692 crore.
(inputs from IANS)