Most accounts, despite their benefits, need the account holder to maintain a minimum balance in the account. Similarly, if you have a savings account, then you must maintain a minimum balance in the account, as specified by the bank.
This fact is true for both private and public-sector banks. However, it is not possible for every person to ensure minimum balance in their account every month due to circumstances beyond control.
To answer the problems arising out of non-maintenance of balance and high charges levied for the same, banks offer you the option of opening a zero-balance account. These accounts have no minimum balance requirements, and have almost no penalty charges, thereby making these the best choice for you!
Features of a Zero Balance account
The zero-balance account offers many benefits in comparison to a normal savings account. Here are some of the best features of a zero-balance account:
- No Minimum Balance: This is the most significant advantage of a zero-balance account. There is no minimum balance requirement for the account holder. You are free to deposit and withdraw as much money as you want, without worrying about penal charges. Additionally, these accounts do not have any average monthly balance maintenance requirements also.
- ATM/ Debit Card: When you opt for a zero-balance opening account, you also receive an ATM or debit card, thus enabling you to operate the account conveniently as well as pay your bills online.
- Free Chequebooks: When you opt for a zero-balance account, you will be given a free chequebook. But there is restriction on the number of free cheque leaves you will be entitled to each year. Should you need extra cheque leaves or an additional chequebook, you can apply for a new checkbook and receive one against payment of a nominal charge.
- A limited number of free withdrawals and deposit transactions: Zero bank account allows you to withdraw money as per your requirement. But remember that, only a limited amount of deposit and withdrawal transactions are allowed for free. If you initiate any deposit or withdrawal transactions beyond the free limit, the same can be done but only after paying a nominal charge applicable, prescribed by the bank.
- A Free Passbook: You will also receive a free passbook along with a starter kit for your zero-balance account.
- Internet Banking: The zero-balance account comes with access to internet banking as well. The best benefit is that there are no additional charges on the internet banking transactions, just some nominal charges which are applicable to all accounts.
- Unique Features: The zero-balance account offer special transactions and features if you hold a salary account. These features may vary from bank to bank.
- Nomination: Most banks allow the zero-balance account holder to select one nominee. The selection of the nominee is to be done in accordance with the Banking Companies (Nomination) Rules 1985. Furthermore, you can change the nominee anytime you want.
What to know before applying for a zero-balance account?
Here are some points to remember and know while applying for zero balance account:
- Eligibility: You should be over the age of 18 years to open a zero-balance account with any bank.
- KYC documents: To apply for a zero-balance account, the you will need to complete the KYC formalities. Without the completion of this step, the account cannot be opened.
- No existing savings account: Banks may have some rules regarding opening a zero-balance account. One such important rule is that you should not have another savings account with the same bank.
Furthermore, it must be remembered the members of a HUF (Hindu Undivided Family) and Non- Resident Indians cannot apply for a zero balance account. Additionally, the bank may ask you to produce any other documents as per their rules, regulations, and requirements.
A zero-balance account is a boon for those individuals who are not able to save up enough money to maintain the required balance for a savings accounts. Furthermore, there are various benefits of the zero-balance account which makes their use comfortable and extremely reliable for the account holder.