Last Updated on September 18, 2023 by Umer Malik
Saving accounts are among the more popular deposit services that banks offer to their customers. Account-holders can use these interest-bearing facilities to park money, which can remain accessible at all times. However, certain types of savings accounts mandate individuals to maintain a minimum account balance. On failing to do so, account holders are charged certain penalties or maintenance fees.
In this regard, a zero balance savings account can be the more suitable alternative.
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What is a Zero Balance Savings Account?
A zero balance saving account is one such facility wherein you do not have to maintain a minimum balance. Salary accounts that employers open for their employees are often zero balance savings account. It is also known as Basic Savings Bank Deposit (BSBD) account as per RBI.
Such accounts proffer several noteworthy benefits to account-holders, as explained below.
Features of Zero Balance Savings Accounts
Following are the primary features of a zero balance saving account.
No Minimum Amount
As the name implies, you do not have to maintain a monthly or quarterly minimum balance in a zero balance saving account.
It allows you to utilise the funds with increased flexibility. Savings account with zero balance can be opened for any residing Indian citizen, including students and unemployed individuals.
Online Digital Account
Select financial institutions also offer completely digital online zero balance savings accounts that can be accessed virtually. These accounts also offer attractive interest on the available balance, with online cash withdrawal and deposit facilities. You can access the savings book through your bank’s website or mobile app.
Easy Online Transactions
Zero balance savings accounts also facilitate online transactions without any additional charges. Like conventional savings books, these also support NEFT, RTGS, IMPS and guarantee cashless transactions.
Debit cards available for these accounts also enable a specific number of ATM cash withdrawals every month.
Complimentary Payment Cards
Depending on the bank, a zero balance savings account also provides complimentary payment cards, such as debit cards. However, you need to pay applicable service charges, quarterly or each year, to use the card.
Simple Documentation
Usually, only KYC documents are required to open a zero balance savings account. For an online savings fund with zero balance, account holders can opt for e-KYC verification to start operating it.
First, you should know how this savings account works.
How Does Zero Balance Savings Account Work?
A zero balance saving account works in the same line as a traditional savings account but with added advantages.
Unlike a traditional savings account, a bank does not impose penalties if the account-holder fails to maintain a minimum balance at a month or quarter-end. It means you can withdraw the entire savings amount and keep the fund balance nil without attracting any added charges.
Typically, such accounts come with a transactional limit on withdrawal. If you breach that limit, banks may upgrade the zero balance account to a normal savings fund.
A zero balance saving account can be held individually or jointly. Besides the fact that account holders do not have to maintain a minimum account balance, this account works exactly the same as a normal one. For instance, you can issue cheques, utilise the ATM/debit card that comes with it and opt for internet and mobile banking.
You can further maximise the benefits by accessing the digital zero balance saving account virtually. Enjoy all the facilities of a savings account and more at your fingertips.
How to Open a Zero Balance Savings Account?
Opening a zero balance saving account is hassle-free and comprises only a few steps. You can open this account both online and offline.
Online Procedure
Step 1: Visit the official website of your preferred bank and go to the savings account section.
Step 2: Select the zero balance savings account option and click on ‘Apply Now’.
Step 3: Fill in the application form with contact number, name, PAN number and necessary information and click on ‘Submit’.
Step 4: Upload the scanned copies of necessary documents and complete the application process.
Step 5: After verifying the documents, you can start operating the account immediately.
Offline Procedure
Step 1: Visit the nearest branch of your preferred bank.
Step 2: Fill up the designated application form alongside the KYC.
Step 3: Submit the signed forms with the necessary documents.
Step 4: Within two working days, the account will be activated.
Hence, a zero balance saving account offers all the benefits of conventional savings accounts without the obligation to maintain a minimum account balance.
Apart from that if you want to know about Accounting Software Before Investing Your Money then please visit our Finance category.
