India’s major government banks—State Bank of India (SBI), Punjab National Bank (PNB), and Bank of Baroda (BOB)—have announced several important updates for their account holders in October 2025. These updates are primarily aimed at expanding digital banking, promoting financial inclusion, and improving customer convenience. The new rules impact millions of customers and cover areas such as minimum balance requirements, account inactivity, KYC updates, and bank transaction charges.
These web-based and mobile banking regulations are designed to benefit customers directly, simplifying old processes and making them more user-friendly. Additionally, a new ₹1 lakh financial assistance scheme has been implemented from October 2025, providing direct credit to eligible account holders.
In this article, we explain all the key updates from SBI, PNB, and Bank of Baroda in simple language so that every customer can understand and take advantage of these new changes.
Highlights of the New Updates by SBI, PNB, and Bank of Baroda
The new updates introduce several key changes for bank account holders. These include modifications to minimum balance rules, account inactivity policies, KYC procedures, digital transaction fees, and the ₹1 lakh direct credit benefit scheme.
All these changes aim to enhance banking security, convenience, and customer service.
| Update Title | Description |
|---|---|
| Change in Minimum Balance Rules | SBI and PNB have removed the minimum balance requirement, while BOB has introduced digital limits. |
| New Account Inactivity Rules | Accounts with no transactions for 2 years may be considered inactive and closed. |
| Mandatory KYC Updates | KYC must be updated every 2–3 years, or the account may be frozen or closed. |
| ATM Transaction Fees | Free withdrawal limits are fixed; additional withdrawals will incur charges. |
| ₹1 Lakh Credit Benefit Scheme | Eligible account holders will receive ₹1 lakh directly credited to their accounts from October 2025. |
| Improvements in Digital Banking | Enhanced security features such as additional OTP and facial verification have been added. |
| Changes in Account Types | New rules apply to premium savings accounts. |
| Government Mega Bank Merger Plan | Smaller public banks are in the final phase of merging with SBI, PNB, and BOB. |
1. Waiver of Minimum Balance and Penalty
SBI and PNB have completely abolished penalties for not maintaining a minimum balance.
This move brings significant relief to small and rural customers, who can now enjoy banking services without financial stress.
Bank of Baroda has also implemented this change partially but has introduced certain limits for digital and cash transactions.
2. New Rules for Account Inactivity
If an account remains inactive for two years without any transactions, the bank can close it after prior notice to the customer.
This measure helps banks keep their records organized and also prevents fraudulent activities.
Customers are encouraged to perform at least one transaction periodically to keep their accounts active.
3. Strict Enforcement of KYC Procedure
Every account holder must now update their KYC (Know Your Customer) details every 2 to 3 years as per RBI’s directive.
Failure to do so may result in temporary suspension or restriction of services.
This step strengthens customer identification and overall financial security.
4. Digital Transactions and ATM Charges
With a focus on expanding digital banking, mobile and internet banking platforms have been upgraded with enhanced security features such as extra OTP verification and facial authentication to prevent online fraud.
Additionally, ATM free withdrawal limits have been capped. Exceeding these limits will attract charges, encouraging customers to use digital payment methods more frequently.
5. ₹1 Lakh Direct Credit Benefit Scheme
In a joint initiative by the government and banks, a new financial assistance program has been launched.
From October 2025, eligible account holders will receive ₹1 lakh directly credited to their bank accounts.
This scheme aims to support individuals in need of financial assistance and will benefit millions of citizens across India.
6. Government Bank Merger Plan and Its Impact
Under the government’s Mega Bank Merger Plan, several smaller public sector banks will merge into SBI, PNB, and BOB by FY 2026–27.
This merger will streamline operations, improve management efficiency, and create a stronger banking network.
Customers will gain access to better services, more branches, and advanced digital systems.
Important Tips for Account Holders
- Regularly monitor your bank account activity.
- Update your KYC details on time.
- Use digital banking securely and activate all available safety features.
- Understand the new minimum balance and transaction rules.
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Stay alert to notifications and messages from your bank.
Conclusion
The new updates from SBI, PNB, and Bank of Baroda are customer-friendly and security-driven.
The removal of minimum balance requirements, mandatory KYC updates, stronger digital banking security, and the ₹1 lakh financial assistance scheme all contribute to a better banking experience for millions of users.
Moreover, the upcoming bank merger plan is expected to bring greater stability and efficiency to the public banking sector in India.
