Canara Bank Minimum Balance | Updated Charges & Rules

Key Takeaways
 

• Canara Bank has removed minimum balance requirements for all savings accounts from June 1, 2025, eliminating charges for low balances.
   
• This zero balance policy applies to every savings account category, including joint accounts, NRI accounts, senior citizen accounts, and student accounts.
   
• Savings accounts continue to earn the same interest as earlier. The removal of the balance requirement does not change the interest rate.
   
• Canara Bank positions itself as one of the most customer-friendly banks in India by removing these restrictions.

A minimum balance is the amount a bank expects you to keep in your account so you don’t get charged penalties. Banks set different minimum balance rules earlier based on whether your branch was in a metro, urban, semi-urban, or rural area. For example, a customer in a metro branch might have to maintain ₹2,000, while someone in a rural branch might need only ₹500.

But here’s the major shift. Canara Bank removed the minimum balance rule for all savings accounts from June 1, 2025.

So even if your account balance falls from ₹2,000 to ₹50, you will no longer be fined. This helps millions of customers who struggle to maintain monthly balances, especially students, pensioners, or people who use their accounts mainly for basic transactions.

This blog explains what the new rule means for you, how the earlier system worked, and why this change is considered a major step toward customer-friendly banking.

Minimum Balance Rules Before June 2025

Previously, Canara Bank had a tiered structure in which clients were required to maintain a specified Average Monthly Balance (AMB) based on whether they were in metro, semi-urban, or rural branches. 

This arrangement meant that your financial responsibilities varied according to where your branch was situated. Metro and urban account holders have to keep twice or even double the balance of rural consumers. 

Here are the minimum balance rules that existed before Canara Bank removed the requirement.
 

These earlier rules often created pressure for customers who could not maintain the required balance every month.

For low-income earners, students, and seniors, even a penalty of ₹100-₹200 felt unjust. Many people struggled to keep their accounts in balance, particularly in rural regions where banking is largely utilised for basic transactions rather than keeping huge amounts of money.

What Changed in June 2025?

Canara Bank eliminated the minimum balance requirement for all types of savings accounts from June 1, 2025. That implies no penalties for non-maintenance, and you may maintain your balance as low as you prefer.

This applies to:

• Regular Savings Accounts
• Salary Accounts
• NRI Accounts
• Basic Savings Deposit Accounts (BSBDA)
• Senior Citizen Accounts

With this move, Canara Bank has made banking more customer-friendly and inclusive.

Why Did Canara Bank Remove the Minimum Balance Rule?

Several considerations affected this decision:

• Customer inclusivity: Penalties deterred many students, seniors, and rural customers.
• Zero balance feature: Private banks like HDFC and ICICI still need minimum balances of ₹3,000 to ₹10,000, making Canara Bank a more tempting option.
• Digital Banking Push: With more digital transactions, banks may earn more from service fees, making balance penalties less important for income.
• Government and RBI Encouragement: To encourage financial inclusion, particularly among rural and low-income households.

Canara Bank establishes itself as a forward-thinking, customer-focused organisation by eliminating balance restrictions

Types of Savings Accounts at Canara Bank

Canara Bank provides a variety of savings account categories, all of which now have zero balance perks. Here's a look at the Canara Bank savings accounts that no longer require a minimum balance.
 

These alternatives demonstrate Canara Bank's commitment to making banking simple and accessible to everybody, whether you're a student, a salaried employee, or a retiree.

How does this impact different Customers?

Here’s how different groups of customers benefit from the new zero-balance rule.

• Students: There is no need to worry about keeping balances when relying on pocket money or scholarships.
• Pensioners are free of fines when their monthly balances fall due to spending.
• Rural Customers: Encourages more individuals to open accounts without worrying about money.
• NRIs: Attracts non-resident Indians seeking a simple, hassle-free savings account for remittances.

This change reduces financial stress and makes banking more accessible for everyone.

Example: Ravi, a 20-year-old student from Bengaluru, previously struggled to retain ₹2,000 in his account. After the regulation change, his account balance can drop below that without incurring penalties. This helps him manage his small pocket money much more easily.

Comparison with Other Banks in 2025

To further appreciate the impact, see how Canara Bank compares to other big banks in India. Let's put Canara Bank's action into context by comparing it to other major banks.
 

Canara Bank is clearly leading the trend with its zero-balance concept, while private banks continue to demand far bigger sums.

Conclusion

Canara Bank’s move to remove minimum balance requirements is a big relief for many everyday customers. It takes away the stress of maintaining a fixed amount and makes banking more flexible for students, pensioners, rural families, and anyone managing tight budgets. 

This decision makes the Canara Bank more approachable and customer-friendly, especially when most banks still expect people to keep a fixed balance. Canara Bank shows that simple steps can make banking easier and more inclusive for everyone with this change.

FAQs

1. Does the zero-balance functionality apply to older accounts as well?

Yes, it applies to current and new savings accounts automatically.

Q2. Will zero balance savings accounts still earn the same interest rate as before?

Yes. Interest rates on Canara Bank savings accounts remain unchanged even after the removal of minimum balance requirements.

Q3. Can I link multiple bank accounts to UPI if my Canara Bank savings account has zero balance?

Yes. Your UPI functionality continues to work normally as long as the account is active, even with a zero balance.

Q4. Will Canara Bank close my account if it remains unused for a long period, even though the minimum balance is zero?

Yes. Like all banks, Canara Bank may classify an account as dormant after prolonged inactivity, but this is unrelated to minimum balance rules.

5. Will I lose my account perks if I do not maintain a balance?

No, your account features and interest eligibility will stay the same.

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LoansJagat Team

‘Simplify Finance for Everyone.’ This is the common goal of our team, as we try to explain any topic with relatable examples. From personal to business finance, managing EMIs to becoming debt-free, we do extensive research on each and every parameter, so you don’t have to. Scroll up and have a look at what 15+ years of experience in the BFSI sector looks like.