The Reserve Bank of India (RBI) and Ministry of Finance have implemented comprehensive banking reforms from 2025 that will revolutionize your savings account experience. These new regulations address minimum balance requirements, transaction limits, banking charges, and digital payment systems, creating a more customer-friendly banking environment across India.
Furthermore, these changes specifically benefit millions of account holders through reduced penalties, enhanced interest rates, and improved digital banking infrastructure. Understanding these new rules is crucial for maximizing your banking benefits while avoiding unnecessary charges.
New Minimum Balance Rules for Savings Accounts
Banks now have the freedom to set minimum balance limits for their customers under RBI’s new framework. However, the central bank has established mandatory standards between ₹500 to ₹1000 for all savings accounts.
Moreover, if your account fails to maintain this balance for three consecutive months, banks can only impose a penalty fee between ₹50 to ₹200. This represents a significant reduction from the previous maximum charge of ₹600.
Additionally, banks must provide advance notification before applying these charges, ensuring customers have adequate time to maintain required balances.
Interest on Zero Balance Accounts
Jan Dhan and Basic Savings Accounts will now earn interest under the new regulations. The RBI has mandated that banks provide at least 3.5% annual interest on all zero balance accounts.
This groundbreaking rule became effective from January 1, 2025, ensuring that even basic account holders benefit from their deposits. Therefore, millions of previously non-interest earning accounts will now generate returns for their holders.
New ATM Withdrawal Regulations
The updated ATM transaction policy provides enhanced benefits for customers across different city categories. The new structure offers:
- 5 free transactions monthly in metro cities
- 7 free transactions monthly in non-metro cities
However, after exceeding these limits, banks can charge a maximum of ₹18 for cash withdrawals and ₹8 for balance inquiries. These charges represent a reduction from the previous cap of ₹21.
Zero Charges on Digital Payments and UPI Transactions
The RBI has definitively clarified that no charges will be levied on UPI or digital payments. Whether you transfer money through Google Pay, PhonePe, Paytm, or any other platform, no fees will apply.
This regulation applies universally to all banks and actively encourages the adoption of digital payment methods across the country. Therefore, customers can freely use digital platforms without worrying about transaction costs.
Relief for Senior Citizens and Women Account Holders
From 2025, individuals above 60 years and women will receive additional interest rate benefits as part of the government’s inclusive banking initiative.
The enhanced benefits include:
- Senior citizens receive up to 0.75% higher interest rates on savings accounts
- Women account holders get an additional 0.25% interest on their deposits
These provisions demonstrate the government’s commitment to supporting vulnerable and priority banking segments through improved financial returns.
Enhanced Auto-Debit Alert System
The RBI has implemented robust security measures for auto-debit transactions to protect customer interests. Banks must now send SMS or email alerts 24 hours before any EMI or subscription deduction.
Additionally, customers can stop these transactions by replying “STOP” to the alert message, providing unprecedented control over automatic payments. This feature prevents unauthorized or forgotten subscription charges.
New Balance Check Methods
Customers can now check their bank balance without internet connectivity using the unified USSD code system. Simply dial *99# from any mobile network to access banking services.
This service works seamlessly across all banks and mobile networks, allowing balance checks, mini statements, and fund transfers. Therefore, even customers in remote areas without internet access can perform essential banking operations.
Stricter Dormant Account Regulations
Accounts with no transactions for 12 months will be declared dormant under the new framework. However, banks must now notify customers via SMS or email 90 days in advance, allowing them to reactivate their accounts.
This proactive approach helps customers maintain active banking relationships and avoid account complications. Furthermore, the advance notice period ensures customers don’t lose access to their funds unexpectedly.
Daily Interest Calculation Method
Savings account interest will now be calculated based on daily balance rather than monthly or quarterly averages. This change particularly benefits small account holders by providing more accurate interest calculations.
The new method ensures fair interest distribution regardless of when deposits or withdrawals occur during the month. Therefore, customers receive precise interest payments based on their actual daily balances.
Multi-Bank Balance Linking System
The RBI has launched the innovative “One Account View” feature in 2025. Customers can now view all their bank account balances through a single app or portal interface.
This service operates under the Account Aggregator Framework, providing consolidated financial information across multiple banking relationships. However, customers must provide explicit consent before linking their accounts.
Impact on Banking Customers
These regulatory changes significantly improve the banking experience for millions of customers nationwide. The reduced penalty charges and enhanced digital payment infrastructure actively support India’s push toward a cashless economy.
Moreover, the special provisions for senior citizens and women demonstrate the government’s commitment to inclusive banking practices. Additionally, the improved transparency requirements ensure customers receive better information about charges and services.
The new rules create a more transparent and customer-friendly banking environment while maintaining financial system stability. Banks must now provide clearer communication about charges, better interest rates for basic accounts, and improved digital services.
Conclusion
The 2025 banking regulations represent a significant shift toward customer-centric financial services. While minimum balance requirements and ATM charges have been reduced, zero balance accounts and digital payments have received substantial support through interest benefits and enhanced security features.
Whether your account is with a government or private bank, understanding these rules is essential to maximize your financial benefits. These changes ensure better protection for your money while encouraging digital adoption in India’s rapidly evolving banking sector.
Frequently Asked Questions
What is the new minimum balance requirement for savings accounts in 2025?
Banks can set minimum balance limits between ₹500 to ₹1000 as per RBI guidelines. Penalty charges for non-maintenance have been reduced from ₹600 to a maximum of ₹200 for three consecutive months of non-compliance.
Do zero balance accounts earn interest under the new rules?
Yes, all zero balance accounts including Jan Dhan and Basic Savings Accounts now earn a minimum of 3.5% annual interest as mandated by the RBI. This rule became effective from January 1, 2025.
How many free ATM transactions are allowed monthly?
Customers get 5 free ATM transactions in metro cities and 7 free transactions in non-metro cities. Additional transactions cost ₹18 for withdrawals and ₹8 for balance inquiries.
Are there any charges for UPI and digital payments?
No, the RBI has confirmed that no charges will be levied on UPI transactions or digital payments through any platform. This includes Google Pay, PhonePe, Paytm, and all other digital payment services.
What special benefits do senior citizens get under new banking rules?
Senior citizens above 60 years receive up to 0.75% additional interest on their savings accounts, while women account holders get an extra 0.25% interest benefit. These rates apply across all participating banks.
