DEFINITION of 'Minimum Balance'
The minimum dollar amount that a customer must have in an account in order to receive some sort of service, such as keeping the account open or receive interest. There can be more than one minimum balance for the same account. For example, a lower balance may be required to keep the account open, while a higher balance can get fees waived or increase the rate of interest paid into the account.
BREAKING DOWN 'Minimum Balance'
Accounts that fall below the minimum balance may be assessed fees, denied interest payments or closed or penalized in some other fashion. The minimum balance may be an average balance or the actual dollar balance in the account. Different banks measure and enforce the minimum balance in different ways.