Question

Why minimum account balance scheme started by banks?

Answer 1

Because banks need to earn money by lending the money you deposit in your account. It is giving you the service of deposit, withdrawal, alerts, etc. So in return it asks for minimum balance. Otherwise, it might happen that the bank has so many accounts but a little money to lend and earn interest on it.

And there are other operating expenses of a bank, major cost is staff and computers cost. It needs to make enough money to afford it all and still have some surplus as profit for owners.