At present, interest rate hikes across the financial industry make savings accounts more enticing. While many banks continue to offer meagre yields on savings accounts, leading banks have increased their deposit rates, including savings accounts interest rates up to 6.50%.
Consumers value savings accounts as a means of the safety of funds and flexibility to use them. The number of savings bank accounts has increased significantly as it is the basic account to avail of various banking services and invest in the financial market. Also, government schemes and demonetisation have led to a rise in bank savings accounts. With many government reforms, even a zero-balance account came into existence.
Features and Benefits of a Zero Balance Saving Account
A zero-balance savings account is a basic savings bank deposit Account (BSBDA). It is designed to help consumers to save up consistently, receive government benefits, and earn interest at attractive rates. The account can be operated at a lower cost than other savings accounts. Go through the features to get clarity on zero-balance savings accounts:
- No Average Balance Maintenance Requirement
As the name suggests, in this zero-balance bank savings account, account holders need not maintain a minimum Quarterly Average Balance (QAB) or Monthly Average Balance (MAB). It can be considered an account free to operate considering the non-maintenance of minimum balance.
Generally, banks want customers to maintain a QAB or MAB in their savings accounts. If the account holder fails to meet the QAB/MAB requirements, they can levy a non-maintenance charge for the month. On the other hand, the QAB/MAB policy does not apply to a zero-balance savings account. Therefore, there is no minimum balance requirement.
- No Initial Deposit
Individuals need not make a deposit to open account online zero balance like other savings accounts. Generally, bank savings accounts are opened with a small amount, say Rs.1,000, as an initial deposit. An initial deposit is not a requirement to open a zero-balance bank savings account.
- Deposit and Withdrawal Limit
Typically, banks set a limit to the amount that can be deposited or withdrawn in/from a zero-balance bank account. This limit may vary from one bank to another. For example, the maximum account balance can be Rs.50,000 in a zero-balance savings account. Also, zero-balance accounts are usually opened with a restriction on the number of transactions that one can make in a month. If the account holder makes more transactions than the permitted numbers, the bank can consider converting a zero-balance account into a regular savings account.
- The Facility of a Zero Balance Salary Account
Customers consider RBL bank as the best bank for salary accounts offering zero balance salary accounts. There is no average MAB requirement and the interest rate is also attractive like a regular savings account with the bank.
- Complimentary Zero Balance Kid’s Account
Just like the best bank for salary accounts, RBL bank is considered for other variants of savings accounts, including a women’s savings account. It offers a complimentary zero-balance kid’s account for customers opening a Woman’s First Savings Account. Per person, one zero-balance kid’s account is allowed.
- Free Services
Various free services are associated with a zero-balance bank savings account. It includes a free passbook facility, a Rupay Debit Card, and cash and cheque deposits at any branch of the bank. However, such free services are the consent of the bank.
- Activate Internet Banking and Mobile Banking
Banks can activate internet and mobile banking for a zero-balance account upon the account holder’s request. Account holders can make digital payments using net banking. They can track their banking activities online.
- Locker Facility
Depending on the bank, customers can take advantage of the safe deposit locker facility. The bank may charge a nominal fee for this safe locker facility.
- Open Account Online – A Zero Balance with Minimal Documentation
Any Indian citizen can open a zero balance account conveniently with minimal documentation. Banks keep the eligibility requirements short and require the following basic documents:
- A valid Aadhar card and a mobile number linked to Aadhar.
- Copy of PAN (Permanent Account Number) Card
Thus, primarily, the non-applicability of the Quarterly Average Balance (QAB) policy makes a zero balance account different from other variants of savings accounts. It helps customers lower their expenditures while inculcating the habit of saving. Stay stress-free with no minimum balance requirement and manage finances easily using a savings account. Generally, banks allow customers to open an account online. For a zero-balance bank savings account, they may need to visit the bank branch.