Most PSU banks have removed min balance charges in savings bank accounts: MoS Finance

New Delhi: Most public sector banks (PSBs) have removed their minimum balance charges in general savings bank accounts, while some have rationalised to promote financial inclusion, Minister of State for Finance Pankaj Chaudhary said on Monday.

As per the RBI's direction, there is no requirement to maintain a minimum balance on Basic Savings Bank Deposit Account (BSBDA). Under the Pradhan Mantri Jan Dhan Yojana, banks are required to open accounts without any minimum balance requirement.

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Certain basic banking facilities, such as deposits, withdrawals, ATM and cards, are to be provided in case of BSBDA accounts without any charges, Chaudhary said in a written reply in the Lok Sabha.

"In alignment with the spirit of financial inclusion and implement customer-centric banking, most Public Sector Banks (PSBs) have removed their minimum balance charges in general savings bank accounts also, while some have rationalised, as per their board-approved policy," he said.

The charges are removed/rationalised as part of their business strategy with the commercial wisdom, in view of the perceived benefits which may arise in terms of growth in deposits, among others, he said.

PSBs have also implemented a multi-pronged strategy to attract CASA (Current Account and Savings Account) deposits and to strengthen customer retention, including, continuous product innovation and segment specific product offerings, smooth and seamless onboarding of customers by leveraging technology, like use of Video KYC, digital KYC verification and financial outreach programs/business campaigns, he said.

Replying to another question, Chaudhary said Reserve Bank of India (RBI) continuously monitors the activities and performance of microfinance sector.

As reported in Financial Stability Report, June 2025 of RBI, the stressed assets in the microfinance sector increased with 31-180 days past due (dpd) from 4.3 percent in September 2024 to 6.2 percent in March 2025, he said.

Further, the banking sector saw an increase in stress in their microfinance loan book with 31-180 dpd rising from 4.7 percent in September 2024 to 6.5 percent in March 2025. However, borrower indebtedness, measured by the share of borrowers availing loans from three or more lenders, showed a declining trend, he said.

As informed by Small Industries Development Bank of India (SIDBI), the reason for the increase in microfinance delinquencies has generally been attributed to ian ncrease in indebtedness among borrowers or overleveraging, weakening joint liability group structures, natural calamities, etc, he said.

Financial Stability Report, June 2025 has also reported that overall, the resilience of the banking system has improved, as indicated by the banking stability indicator (BSI), which strengthened during 2nd half of FY 2024-25 and the capital position of the non-banking financial companies (NBFCs) remained well above the regulatory minimum, he said.

In reply to another question, Chaudhary said the government has taken various measures over the last few years to address the issues related to credit discipline, responsible lending, improved governance, adoption of technology, and proper regulation of Co-operative banks have been taken by the Government/RBI.

Credit discipline has been instilled through enactment of the Insolvency and Bankruptcy Code (IBC) and setting up of the Central Repository of Information on Large Credits (CRILC) by RBI to monitor corporate loans and systematic checking of high-value accounts for wilful default and fraud.

Other measures are recognition and resolution of stressed assets, governance reforms in PSBs, Enhanced Access & Service Excellence (EASE) reforms and amalgamation of PSBs.

With regard to digital payments, he said, the total volume of digital payment transactions in the country has increased from 2,071 crore in FY 2017-18 to 22,831 crore in FY 2024-25, growing at a CAGR of 41 percent.

During the same period, the value of transactions has grown from Rs 1,962 lakh crore to Rs 3,509 lakh crore, he said.

"Further, the total monthly volume of digital payment has increased from 1,739 crore in June 2024 to 2,099 crore in June 2025. During the same period, the value of transactions has increased from Rs 244 lakh crore in June 2024 to Rs 264 lakh crore in June 2025," he said.

UPI transactions, in particular, have grown from 92 crore in FY 2017-18 to 18,587 crore in FY 2024-25, with a CAGR of 114 percent, he said.

During the same period, the value of transactions has grown from Rs 1.10 lakh crore to Rs 261 lakh crore, he said.

In July 2025, he said, UPI reached another milestone of recording over 1,946.79 crore transactions in a single month for the first time.

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