Updated May 9, 2024
Ano nga ba ang Average Daily Balance o Maintaining Balance?
Bakit merong penalty of 300 pesos or more every month kapag hindi na-maintain ang maintaining balance na nire-require ng bank sa dalawang magkasunod na buwan or for 2 consecutive months?
Ang Maintaining Balance ay yong amount of money na dapat laging nasa bank account para tuluy-tuloy lang ang account na walang penalty. Nire-require ng banks ito para meron silang consuelo sa pagme-maintain ng bank transactions and bank records.
Madalas, tinatawag din ang Maintaining Balance na Minimum Monthly Average Daily Balance (MADB),
kasi ang Maintaining Balance is the Minimum Average Daily Balance na dapat meron tayo sa ating savings account or checking account every month para walang penalty.
Why is there a Maintaining Balance requirement?
The banks say they spend money to handle our accounts and maintain our bank records, so they must make some profit from our accounts, and therefore, according to them, we should maintain a certain minimum amount of money in our accounts.
The banks check our balances, not everyday, but every last business day of the month. They compute the average balance per day for 30 days or 31 days of the month — that’s why it’s called Monthly Average Daily Balance (MADB).
They consider the end-of-day balance. If our balance in the morning is 10,000 pesos, and at the end of the day, our balance is 15,000 pesos, they consider 15,000 pesos.
If the required Maintaining Balance is 2,000 pesos, do we need to have 2,000 pesos in our account everyday?
Yes, so that we don’t have to think about maintaining balances. 🙂 Hindi na tayo mag-compute-compute ng average.
Pero puede namang hindi everyday. We can have less than 2,000 pesos in our accounts some days, as long as we deposit much more than 2,000 pesos in other days, so that when the MADB is computed on the last business day of the month, the MADB comes out to be 2,000 pesos or more.
Example:
Your savings account has a balance of 2,000 pesos.
The required MADB is 2,000 pesos.
The penalty for falling below MADB for 2 consecutive months is 300 pesos.
One day, you withdrew 500 pesos, resulting in a balance of 1,500 pesos.
Will your balance be reduced by the 300-peso penalty?
Can be Yes, can be No.
If your balance remains 1,500 pesos over 2 consecutive months, your balance will be reduced by the 300-peso penalty at the end of the 2nd month.
But if you deposited high amounts of money in other days, so that your MADB at the end of the month is 2,000 pesos or more, then your account will not be penalized.
Or even if you fell below MADB for the first month, but you reached your required MADB on the second month, you will not get the penalty. Kasi one month ka lang hindi naka-comply sa balance requirement. Meron lang penalty kapag dalawang magkasunod na buwan na hindi mo na-maintain ang account mo.
Ilang Beses Mag-Charge ang Bank ng Maintaining Balance Penalty?
Isang beses sa isang buwan. On the last business day of the month. Magsi-simula ang charging sa 2nd consecutive month na hindi mo na-maintain ang account mo. At magcha-charge uli sa following month kapag hindi mo pa rin na-maintain. At kapag hindi mo pa rin maibalik sa maintaining-balance level, tuluy-tuloy na ang charging hanggang maubos ang laman ng account mo at mag-automatic close na.
Again, what is MADB?
It stands for Monthly Average Daily Balance. Yong Average Daily Balance mo sa Month na tinitingnan kung na-maintain mo ang account mo sa month na yan.
How to Compute Monthly Average Daily Balance (MADB)
This is how to compute monthly average daily balance (MADB).
If your Monthly average daily balance is equal or higher than your required maintaining balance, then your account is good.
So you don’t have to worry about the maintaining balance requirement, deposit the required maintaining balance, then leave it there in your account — do not touch it. Use only the amounts above your maintaining balance.
But in case you withdraw more than what you should, deposit higher amounts over the next days so your Monthly Average Daily Balance (MADB) will still be equal or higher than your Maintaining Balance Requirement.
This is how to compute your Monthly Average Daily Balance (MADB):
For example, this is your account record for the month:
| Date | Transaction | Debit | Credit | Balance |
| 6/1/20xx | 4,000 | |||
| 6/15/20xx | ATM cash deposit | 8,000 | 12,000 | |
| 6/20/20xx | ATM withdrawal | 4,000 | 8,000 | |
| 6/28/20xx | OTC cash deposit | 7,000 | 15,000 | |
| 6/28/20xx | online bill payment | 5,000 | 10,000 | |
| 6/30/20xx | ATM withdrawal | 4,000 | 6,000 |
FIRST, add your daily balances from the first day of the month to the last day of the month.
From 1st day to 14th day, your daily balance was 4,000 pesos.
4,000 pesos x 14 days = 56,000 pesos
From 15th day to 19th day, your daily balance was 12,000 pesos
12,000 pesos x 5 days = 60,000 pesos
From 20th day to 27th day, your daily balance was 8,000 pesos
8,000 pesos x 8 days = 64,000 pesos
From 28th day to 30th day, your daily balance was 10,000 pesos
10,000 pesos x 3 days = 30,000 pesos
On the 30th day, your balance was 6,000 pesos
6,000 pesos x 1 day = 6,000 pesos
The total of your daily balances for the month is:
56,000 pesos
60,000 pesos
64,000 pesos
30,000 pesos
6,000 pesos
——————–
216,000 pesos
SECOND, divide the TOTAL by the number of days of the month.
216,000 pesos / 30 days = 7,200 pesos
Your MADB is 7,200 pesos
Your MADB or Maintaining Balance Requirement is 5,000 pesos.
Obviously, 7,200 is higher than your 5,000-peso maintaining-balance requirement, so you have maintained your bank account for the month.
Is there a Philippine law regarding maintaining balance in bank accounts?
There is. It’s in the Manual of Regulations for Banks (MORB), the implementing rules and regulations of the General Banking Law of 2000 and other banking laws.
These are the rules:
- The minimum MADB and the amount or rate of maintenance fee should be disclosed to the client in the Terms and Conditions of Deposit
- The maintenance fee is charged only if the account has fallen below the required MADB for at least 2 consecutive months.
- If there is any change in the minimum MADB, clients must be notified at least 60 days before the change is implemented. Means of notification are described in the MORB.
- One of the qualifying grounds for the charging of Dormancy Fee is that the account has fallen below the required MADB.
Gusto mo ba ng Bank Account na Walang Maintaining Balance?
Meron na ngayon mga Digital Savings Accounts na walang initial deposit at walang maintaining balance. Just prepare your main valid ID, then download the mobile app from Google Play or Apple Store. —->>> Digital Banks in the Philippines
Peso Savings Accounts for OFWs, Usually Zero or Low Maintaining Balance
US Dollar Accounts with Low Maintaining Balance Requirement
Checking Accounts with Low Maintaining Balance Requirement
Peso Savings Accounts with Low Maintaining Balance Requirement
Another example of Monthly Average Daily Balance (MADB) computation
They add the end-of-day balances for all the days of the month,
and then divide the TOTAL by the number of days of the month
(divided by 30 or 31 or 28 or 29).
Example: April has 30 days:
For the first 5 days of the month, your balance everyday was 2k.
then for the next 20 days, your balance everyday was 1k
and for the last 5 days, your balance everyday was 3k
5 days x 2k = 10k
20 days x 1k = 20k
5 days x 3k = 15k
10k plus 20k plus 15k = 45k
45k divided by 30 days = 1,500 pesos
Your MADB is 1,500 pesos
Obviously, that’s below the 2k minimum MADB.
If for the next month, your MADB is still below 2k, then your account balance will be reduced by 300 pesos.
Another example: March has 31 days
First 5 days, balance everyday is 2k = 10k
Next 10 days, balance everyday is 1k = 15k
Next 16 days, balance everyday is 3k = 48k
10k plus 15k plus 48k = 73k
73k divided by 31 days = 2,354.84
Your MADB is 2,354.84.
That’s above the 2k required MADB. That means you have maintained your account, so there will be NO penalty.
And that means you are on your way to saving a LOT of MONEY if you continue to deposit and NOT withdraw.
Holidays or Saturdays/Sundays at the end of the month:
If the last days of the month are holidays, or Saturdays and Sundays, the bank computes the MADB on the last banking day before the holidays, Saturdays or Sundays.
For example, April 29 is a Saturday and April 30 is a Sunday, the bank computes the MADB on Friday, April 28.
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