Indian Bank and Punjab National Bank (PNB) have recently announced the removal of penalties for not maintaining a minimum balance in savings accounts. These changes aim to enhance banking accessibility, particularly for individuals from rural or low-income backgrounds.
Big Relief for Account Holders
- Indian Bank: Effective July 7, 2025, Indian Bank will cease charging penalties for failing to maintain a minimum balance in savings accounts.
- PNB: Similarly, PNB eliminated these charges from July 1, providing relief to various customers, including students, senior citizens, small shopkeepers, and rural families.
Lower Interest Rates for Borrowers
Indian Bank has not only waived balance penalties but also reduced its one-year MCLR by 5 basis points to 9% starting July 3, 2025. This adjustment may lead to slightly lower interest rates for new loan applicants, resulting in long-term savings.
Helping the Underserved
PNB highlighted that the elimination of minimum balance penalties will particularly benefit women, farmers, and low-income households who often struggle with maintaining minimum balances. This waiver is expected to alleviate their financial stress and promote greater engagement in the formal banking sector.
Key Takeaways for Competitive Exams
- Financial Inclusion: The removal of minimum balance charges by Indian Bank and PNB aims to enhance financial inclusion and expand banking services to a wider population.
- Interest Rate Reduction: Indian Bank’s rate cut on MCLR provides potential borrowers with the opportunity to access loans at lower interest rates.
- Impact on Underserved Groups: The initiative is particularly beneficial for women, farmers, and low-income households, easing their financial constraints and promoting participation in the formal banking system.
