The unassuming savings account — once a quiet corner of personal finance — is having a moment in 2025. And with banks and their regulators making sweeping changes, account holders are having to navigate a new terrain of interest rates, balance requirements and the digital expectations of banks. Whether you’re an experienced saver or just getting started, it’s important to know about these changes so you can maximize your money.
Interest Rates Take a Dip
This comes after a 100-basis-point reduction in the Reserve Bank of India’s repo rate since February 2025 and most banks cutting savings account deposit rates. Big boys like SBI, HDFC and ICICI now pay a flat 2.5%-2.75% interest rate on all balance levels. This change has hurt most of the high value deposits holders who used to get 2.
Private Banks Offer a Silver Lining
Even though rates have been cut by public sector banks, some private sector banks continue to provide good returns. RBL Bank takes the cake with 6.75% interest for high-balance accounts, and Bandhan and IndusInd Bank still offer rates higher than the market average. These banks are fast emerging as alternatives for investors looking for higher returns without being tied down to fixed deposits.
Minimum Balance Rules Tighten
Since April 1, 2025, a number of banks have changed their minimum-balance conditions. City-based account holders are now subject to higher thresholds and punished for non-compliance. For example HDFC and Axis Bank currently have a ₹10,000 requirement for urban accounts, while Canara and PNB have experimented with graduated penalties based on region and shortfall [5].
Digital Banking and UPI Updates
The NPCI has announced new UPI rules. In case your registered mobile number is not active, your UPI ID will automatically get unlinked. The change is intended to bolster security but will also require users to pay attention to wherever their mobile network is coming from.
ATM Withdrawals and Security Enhancements
There are also new rules for using ATMs. Customers can currently make up to three free withdrawals from other bank ATMs in a month. After that, an exit fee of ₹20–₹25 per transaction is levied. Also, the Positive Pay System is now a must for cheques above ₹5,000, providing an extra level of authentication to stop scams.
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