The State Bank of India on Monday announced that the monthly minimum balance required for a savings account will be lowered from Rs 5,000 to Rs 3,000 in metro centres from October 1.

The penalties for not maintaining this balance will also be lowered “20% to 50% across all population groups and categories”, the lender announced in a statement. “At semi-urban and rural centres, the charges range from Rs 20 to Rs 40, and they are between Rs 30 and Rs 50 at urban and metro centres,” SBI said.

This revision is likely to benefit 5 crore account holders, the bank said.

Pensioners, recipients of social benefits from the government and accounts of minors will be exempted from having to maintain this minimum. People who had accounts under the Prime Minister’s Jan Dhan Yojana and Basic Savings Bank Deposits Accounts were already exempted.

On April 1, the bank had announced that it would restart charging its account holders a penalty if they fail to maintain a minimum balance in their savings account. It had said that it will use this penalty amount to cover expenses such as running operations and systems for its 250 million savings accounts.