There have been several queries recently around our recent communication of MAB. We hope that this article helps our users understand what MAB is, how it is calculated, and what are the effective changes to user accounts due to this.
Understanding MAB: For Jupiter users, MAB stands for “Monthly Average Balance”. This differs from the universally accepted “Minimum Account Balance” that most traditional banks have. The Monthly Average Balance is our effort in incentivizing our users who truly look at Jupiter as their primary bank account, and as such, it is closely linked to our Rewards Structure as well. Unlike other banks who charge customers for failing to maintain the Minimum Account Balance, there are no charges or deductions for our customers if they fail to maintain the Monthly Average Balance. This ONLY affects their ability to earn rewards for eligible debit card and UPI transactions. Our PRO Salary users are exempt from the MAB structure.
How is MAB calculated: We have the simplest way to calculate the Monthly Average Balance of our users. We take the sum of the DAY-END balances of the user’s account, and simply divide this by the number of calendar days in the month. The DAY-END balance also includes any amount that the customer saves in their POTs Account. Users who maintain the Monthly Average Balance are automatically categorized to earn jewels on eligible debit card and UPI transactions - depending on their tenure or previous eligibility status.
Say for the month of September, a customer maintains a DAY-END balance of
· INR 20,000 for 10 days
· INR 30,000 for 5 days
· INR 4000 for 8 days
· INR 12,000 for 7 days.
The first step to calculate the Monthly Average Balance, is to sum up all the DAY-END balances of the customer, which in this case is ((20,00010)+(30,0005)+(40008)+(12,0007)) = 4,66,000.
The next step is to divide this total with the number of calendar days in the month of September – 30.
The Monthly Average Balance for this customer is (4,66,000/30) = 15,333.33
What does the introduction of the MAB mean for our customers: As we mentioned above, unlike traditional banks, failing to maintain the Monthly Average Balance does not have any repercussions for our customers, such as being charged maintenance or other fees. This only means that our users will not be able to earn jewels for eligible debit card and UPI transactions. Most of our transacting customers are already able to meet the Monthly Average Balance via their DAY-END balance sums; or have created POT accounts to keep this amount aside, thereby relieving them from having to track their MAB.
Maintaining a certain corpus and having regular transactions is an integral part of any banking system – that is mutually beneficial for all parties involved. We have put in a lot of thought while designing our MAB process – ensuring least disruption to the majority of our customers, and also incentivizing the right banking behavior for those customers who use Jupiter account as their secondary account only - thereby making this mutually beneficial.
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