What is Zero Balance Savings Account?

A Savings Account is a facility provided by the banks wherein you can deposit your surplus funds and can withdraw when in need. You will be earning interest on the amount deposited and so this is the best way to invest your surplus funds which otherwise would be idle or spent unnecessarily. A Savings Account is advantageous since it does not have a maturity date and you will not be blocking your funds. You will have to maintain a minimum balance in the account as stipulated by the bank, failing which, a penalty will be levied.

Zero Balance Savings Account or the No-frill account which was a part of the financial inclusion plan that was introduced to inculcate the saving habit in a majority of the population. This account can be opened with no restrictions on the minimum balance to be maintained. Despite this, the account will be provided with all the facilities that are offered to a normal Savings Account.

Features of a Zero Balance Savings Account

The following are the features of a Zero Balance Savings Account:

  • As the name indicates, the account can be opened with zero balance. There is no stipulation of minimum balance for this account.
  • A free passbook will be issued to the account holder on opening the zero- balance account. This feature is similar to that of the normal Savings Account.
  • You can make payment of utility bills from these accounts through internet banking facility
  • A free ATM/Debit Card will be issued and you will be able to access the account through ATM of any bank.
  • Cash and cheque deposits can be made to this account through any branch of the bank
  • You can use the ATM/Debit card issued to Zero Balance accounts to make online payments. The card operates on electronic payment gateway such as Rupay through which online payments are easy and convenient.
  • Some banks offer safe deposit locker facilities for zero balance accounts

Top Banks Offering Zero Balance Savings Account

Some of the top banks offering Zero Balance Saving Accounts are:

Kotak Mahindra Bank

Kotak Mahindra Bank headquartered in Mumbai is an Indian Private Sector Bank. It was found in the year 1985 and was issued a licence by Reserve Bank of India (RBI) in the year 2003 to carry on banking business.

Bank Account Type Interest

Kotak Mahindra Bank

811

  • 6% p.a. for a balance between 1 Lakh to 1 Crore
  • 5.5% for a balance above 1 Crore

Key Features of the Account:

  • The Kotak Mahindra Bank's Zero Balance Account is fully digital and the account can be opened within 5 minutes.
  • A virtual debit card will be issued to the account which can be used for online transactions
  • No additional charges for NEFT/IMPS transactions done through this account
  • Payment can be made using scan and pay options at stores
  • The m-store feature in the bank's app allows you to shop online without downloading other applications.
  • The balance in the account should not exceed 1 Lakh at any point
  • The maximum limit for online transactions is stipulated at 1 Lakh
  • Full KYC compliance has to be done before completion of 1 year

ICICI Bank

ICICI Bank is an Indian multinational banking & financial services company headquartered in Mumbai with its registered office at Vadodara, Gujarat.

Bank Type of Account Interest

ICICI Bank

Basic Savings Account

  • 3.5% p.a. up to a balance of 50 Lakhs
  • 4% p.a. for a balance above 50 Lakhs

Key Features of the Account:

  • Free passbook will be issued to the account
  • Free Rupay card will be issued
  • Free cash deposit and cash withdrawal facility will be available
  • The applicant should not have any other Savings Account. If the bank identifies any other savings account for the customer, then the Basic Savings Account will be closed.

Citibank

Citibank is the only foreign bank in India with a full-service onshore platform in the country. Headquartered in Mumbai (Maharashtra), the bank is a subsidiary of Citigroup, a multinational financial services corporation headquartered in New York City, United States.

Bank Type of Account Interest

Citibank

Basic Savings Bank Deposit Account

4%

Key Features of the Account:

  • No minimum balance is required
  • Free ATM/Debit Card will be provided with a daily transaction limit of 10,000 across ATM and Point of Sale.
  • Daily transaction limit of 10,000 stipulated for online transactions
  • Free cheque book facility available
  • 24 x 7 access to Citibank online and SMS Banking facility available for quick checks on your account.
  • Unlimited credits can be made via all channels to the account
  • Maximum of four withdrawals allowed in a month across all channels including ATM withdrawals.

DBS Bank

Formerly known as the Development Bank of Singapore Limited, DBS Bank is a multinational banking and financial services corporation. It has its headquarters in Singapore. The bank acquired its present name in July 2003. A full-fledged branch was started in Mumbai, Maharashtra in the year 1995.

Bank Type of Account Interest

DBS Bank

Basic Savings Bank Deposit Account

7%

Key Features of the Account:

  • There is no minimum balance stipulation for this account
  • Basic banking services and cheque book facility are available
  • In a month you are allowed to make a maximum of 4 withdrawal transactions through all the channels including ATM withdrawals.

Standard Chartered Bank

Standard Chartered Bank (SCB) has been in India for over 150 years. It is the largest international bank of India with 100 branches in 43 cities. They have been in India since 1858.

Bank Type of Account Interest

Standard Chartered Bank

Basic Banking Account

3.5%

Key Features of the Account:

  • No minimum balance required
  • Free Debit Card provided
  • Personalised multicity, payable at par cheque book will be issued free of cost
  • Unlimited access to any Standard Chartered Bank branch across India without any additional charges for the branch visit.
  • You can withdraw cash any number of times at any bank's ATM without any additional charge

HDFC Bank

HDFC Bank was incorporated in 1994. Its registered office is in Mumbai, India. It has 4,805 branches and 12,260 ATMs across the country.

Bank Type of Account Interest

HDFC Bank

Basic Savings Bank Deposit Account

4%

Key Features of the Account:

  • No minimum balance required
  • Free Rupay card will be issued
  • Free passbook facility available for all individual account holders
  • Free cash and cheque deposit facility at ATMs and branches available
  • Four free withdrawals allowed in a month through all channels including ATM withdrawals
  • Free lifetime bill payment facility will be provided
  • Free Insta Query facility will be provided
  • Free e-mail statements will be provided

State Bank of India

Headquartered in Mumbai, the roots of the State Bank of India (SBI) lie in the establishment of Bank of Calcutta later named as State Bank of Bengal in 1806. Bank of Bengal was one of the three presidency banks, the other two being Bank of Bombay and Bank of Madras. The three presidency banks were amalgamated in the year 1921 and were named as The Imperial Bank of India.

Pursuant to the provisions of State Bank of India Act of 1955 the RBI acquired a controlling interest in the Imperial Bank of India.

Bank Type of Account Interest

State Bank of India

Basic Savings Bank Deposit Account

3.5%

Key Features of the Account:

  • No minimum balance is required
  • Issuance of Rupay card for free of cost
  • Four free transactions allowed in a month through all channels including ATM withdrawals
  • Deposit and collection of cheques drawn by Central/State Government will be free
  • No charge will be collected on activation of the inoperative account
  • No account closure charges will be collected
  • Receipt/credit of money through NEFT/RTGS will be free of cost
  • A person holding BSBD Account cannot have any other Savings Account

Axis Bank

Axis Bank formerly known as UTI Bank is the third largest bank in India. It has its head office in Mumbai. In the year 2007, UTI Bank changed its name to Axis Bank.

Bank Type of Account Interest

Axis Bank

Axis ASAP Account

3.5%

Key Features of the Account:

  • No minimum balance required
  • Higher interest rate will be paid on balances above 10,000
  • Virtual Visa Debit Card with an online purchase limit of 1,00,000 will be issued
  • A discount of 150 available on tickets booked on BookMyShow
  • 20% discount available for purchases made on the big basket

IDFC Bank

IDFC First Bank is an Indian banking company with its headquarters in Mumbai. It is a part of IDFC, an integrated infrastructure Company. The bank received a universal banking licence from RBI in July 2015 and started operations on October 2015.

Bank Type of Account Interest

IDFC Bank

BSBDA Pratham Savings Account

4%

 Key Features of the Account:

  • No minimum balance required
  • This account can be used to receive government subsidies and funds
  • Can open the account only by submitting an Aadhaar Card either at the branch or through their micro-ATM.
  • Access to mobile banking, internet banking, and cheque book facility provided on special request.
  • Unlimited transactions are allowed at ATMs across the country free of cost

Bank of Baroda

Bank of Baroda, one of the leading multinational public sector banks was found by Sayajirao Gaekwad II in 1908. The Head Office of the Bank is in Vadodara, Gujarat.

Bank Type of Account Interest

Bank of Baroda

Baroda Basic Savings Account

  • 3.5% p.a. up to a balance of 50 Lakhs
  • 4% p.a. for a balance above 50 Lakhs

Key Features of the Account

  • No minimum balance is required
  • 50 cheque leaves will be allowed free in a year
  • Standing Instructions and ECS (debit) is allowed in this account
  • Debit Card and internet banking facility is available in this account
  • There is no restriction on deposits made by adult individuals
  • No charges for the activation of an inoperative/dormant account, and for non-operation of account
  • Introduction and KYC norms will be observed as per extant guidelines
  • Customers with Basic Savings Account will not be allowed to open any other Savings Account. If they already have a savings account the same should be closed within 30 days.

Punjab National Bank

Punjab National Bank (popularly known as PNB) is an Indian multinational banking & financial services company found in the year 1894. It is a New Delhi based state-owned corporation.

Bank Type of Account Interest

Punjab National Bank

Basic Savings Bank Deposit Account.

  • 3.5% p.a. up to a balance of 50 Lakhs
  • 4% p.a. for a balance above 50 Lakhs

Key Features of the Account:

  • No minimum balance required
  • A cheque book with 20 leaves issued free of cost in a year
  • Four withdrawals allowed in a month across all channels including ATM withdrawal
  • Debit Card will be issued free of cost. However, annual maintenance charges will be collected.
  • There will be no limitation on the extent of deposits made in the account
  • Customers with BSBDA Account cannot have any other Savings Account. If they already have other Savings Account, the same must be closed within 30 days.

Central Bank of India

Central Bank of India is one of the oldest & largest commercial banks in India. It is headquartered in Mumbai which is the financial capital of India.

Bank Type of Account Interest

Central Bank of India

Cent Bachat Khata

  • 3.5% p.a. up to a balance of 50 Lakhs
  • 4% p.a. for a balance above 50 Lakhs

 Key Features of the Account:

  • 50 withdrawals allowed free of charge in a year
  • 1 cheque book free of charge in a year
  • The total credits in the account should not exceed 1,00,000 in a year. The balance in the account should not exceed 50,000 at any point in time.
  • Simplified KYC procedures followed for the introduction. Any customer who has fulfilled the KYC norms can introduce the customer.
  • An account can be opened in any branch

Deutsche Bank

Deutsche Bank headquartered in Frankfurt, Germany is a leader in Germany and Europe. The first branch of Deutsche Bank in India was established in the year 1980. Now it is operating in 16 cities all over the country.

Bank Type of Account Interest

Deutsche Bank

Easy Savings Account

4% PA

Key Features of the Account:

  • No minimum balance required
  • 2 cheque books with 25 leaves issued free in a year
  • International ATM-cum-Debit Card issued free of cost
  • Statement of accounts issued free of cost

HSBC Bank

HSBC Bank India, is the Indian subsidiary of UK-based HSBC Holdings plc., headquartered in Mumbai. It is a foreign bank registered under the Banking Regulation Act, 1949 and thus is regulated by the Reserve Bank of India.

Bank Type of Account Interest

HSBC Bank

BSBDA Account

3.5% PA

Key Features of the Account:

  • No minimum balance required
  • Debit Card is issued free of cost with a daily cash withdrawal limit of 25,000 and purchase limit of 10,000.
  • Free cheque book issued
  • Access to internet banking and mobile banking is available
  • Unlimited free deposits allowed in the account
  • Four free withdrawals allowed in the account through all channels including ATM withdrawal

Yes Bank

Rana Kapoor and Ashok Kapoor are the founders of Yes Bank Limited which is the fourth largest private sector banks. The Headquarters of Yes Bank is in Mumbai. It mainly operates as a Corporate and asset management and retail banking are its subsidiary functions.

Bank Type of Account Interest

Yes Bank

Zero Balance Savings Account

6%

Key Features of the Account:

  • No minimum balance requirement
  • Free RTGS/NEFT payment facility available through net banking services
  • Free utility bill payments facility available through net banking services
  • International platinum chip card provided on special request
  • The facility of free DD up to a defined limit is available

Eligibility to Open a Zero Balance Account

You are eligible to open a Zero Balance Account if:

  • You are a resident individual and have complete KYC. That is, you have
    • Photo ID proof as per bank's acceptable list of documents
    • Address Proof as per bank's acceptable list of documents
  • Resident individuals and HUF can open the account
  • Minors above 10 years can open self-operated accounts

Points to Remember While Maintaining a Zero Balance Account

The following points should be remembered while maintaining a zero- balance account:

  • The balance in the account should not exceed 50,000 at any point
  • The maximum limit for online transactions is stipulated at 1 Lakh
  • Four free withdrawals allowed in a month through all channels including ATM withdrawals. If withdrawals go beyond the stipulated numbers, the zero balance account will be converted to a normal savings account. Some banks simply charge for the withdrawals exceeding the maximum limit.
  • The customer holding a zero balance account should not have any other savings account. If in case they are holding any other savings account, the same should be closed within 30 days of opening the zero balance account.

Difference between Regular Savings Account and Zero Balance Savings Account

The following are the differences between Regular Savings Account and Zero Balance Account:

Regular Savings Account Zero Balance Account
  • Full KYC is required to open the account
  • Minimum balance is required to be maintained
  • Annual charges collected for ATM/Debit Card
  • Useful for day to day transactions
  • No limit on deposits to the account
  • No cap on withdrawals
  • A higher number of free ATM withdrawals
  • The Account can be opened at any branch of the bank
  • Only one proof can be submitted to open the account
  • No minimum balance is required
  • ATM/Debit card issued free of cost
  • Can be used occasionally
  • A maximum of 1 Lakh can be deposited in a financial year
  • Can withdraw only up to 10,000 in a month
  • A limited number of free ATM transactions
  • Only a limited number of branches offer this account

How to Open a Zero Balance Account?

You can open a Zero Balance Account by visiting the nearest branch and submitting KYC documents.

Alternatively, you can open the Digital Savings Account online on your smartphone by accessing the app of the respective bank.

Documents Required to Open Zero Balance Account

  • Duly filled application for opening Savings Account
  • Proof of Residential Address like Utility Bills of at least 3 months, Driving Licence, Passport, Property Tax Receipt (any one).
  • Photo ID Proof like PAN Card, Voter' ID, Driving Licence (any one)
  • Aadhaar Card copy
  • Either a Photo ID issued to permanent employees of Public/Private Sector Banks, Central/State Government Organisations, Scheduled Departments/Statutory Regulatory Authorities and, Scheduled Commercial Banks or a letter issued by a gazetted officer with a duly attested photograph of the applicant is a valid document accepted for opening a Zero Balance Account.
  • If KYC documents as per bank's acceptable list of documents are not available, the account can be opened with an introduction by a customer who has completed the KYC norms.

Frequently Asked Questions

What is a zero balance account?

Zero Balance Savings Account, also known as the No-frill account is a savings account that can be opened with no restrictions on the minimum balance to be maintained. Despite this, the account will be provided with all the facilities that are offered to a normal Savings Account

What is the rate of interest offered on zero-balance accounts?

The rate of interest is similar to the rate of interest applicable to a regular savings account.

What are the limitations in the zero-balance account?

The limitations of the zero balance account as mentioned below:

  • Balance in the account at any point in time should not exceed 50,000
  • Only four free withdrawals are allowed in a month through all channels including ATM transactions.
  • A person holding a zero balance account should not have any other kind of savings account
  • The maximum limit for online transactions is 1,00,000

Who can open a zero-balance account?

  • Resident individuals and HUF can open a zero balance account
  • Minors above 10 years can open a self-operated account
  • Individuals who are not able to comply with KYC norms can open the account with an introduction from a customer of the bank who has fulfilled the KYC norms.

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