In recent years, zero balance savings accounts have seen a consolidated push from almost all major Indian banks. They are now widely available, mainly to the benefit of the unbanked population. This is because these accounts offer convenient banking without minimum balance requirements. Government schemes and demonetization have also played a significant role in this growth.
The Jan Dhan Yojana (JDY) program is one such initiative. It encourages every household to open one account by offering zero balance accounts without any fees. Besides having no initial deposit, these accounts provide many additional benefits, such as better interest rates, no-cost debit cards, insurance coverage, and more. These features make them an attractive option for many.
In this post, we will discuss the different facts about a zero balance account, how to open it online, and why it is suitable for you. Then, you can consider your personal situation and see whether you need one.
Facts About Zero Balance Account
Zero balance accounts were designed to make banking accessible. They require no minimum balance, which allows more individuals to enter the banking system.
- You get essentials like a free passbook and monthly statements at no extra cost.
- Some banks might also offer services like safe deposit lockers and checkbooks.
- There are usually caps on the number of free ATM withdrawals and other transactions.
- These accounts come with contactless payment options, a feature that allows you to make payments without physically swiping your card. You can use virtual cards, UPIs, etc., to ease checkout at stores and via online gateways. Many banks offer 100% digital zero balance savings accounts, which allow you to open the account instantly with minimal paperwork.
- Zero balance accounts further offer lucrative offers like cashback on debit card spends, festive discounts on merchant outlets, complimentary movie tickets, and more.
Why Choose a Zero Balance Account?
The following are some of the reasons why investing in a zero balance account is worth it:
- Inclusivity: Whether you are a student or a young professional, a zero balance account is a fit for all. If you haven’t started your financial journey, it is the ideal choice to begin your own financial journey.
- Competitive Interest Rates: Not only are zero balance savings accounts tailored for convenience, but they also offer impressive returns. Banking institutions like Kotak811 offer up to 7% interest per annum with ActivMoney.
- Online Banking Services: From net banking to mobile banking, you can access your zero balance account from anywhere, anytime, with the help of a stable internet connection. You can make and receive payments, too.
How to open a zero balance account online
Here are the steps to open a zero balance account online:
- Visit the bank’s official website site.
- Check on the open zero balance account option.
- Add in your PAN and Adhaar card details and proceed.
- Now, join the video call with a bank official for video KYC.
- Allow the browser to access the camera, microphone, and location.
- Show the physical copy of the government-issued photo ID and proof of address to complete the process.
Once the verification is done, the official will review and process your application.
How many Zero Balance Savings Accounts can you open?
As per the Reserve Bank of India, you can open only one zero balance account in a bank. Also, you cannot hold another type of savings account if you already have a zero balance account in the existing bank. When opening a zero balance account, you must sign a declaration stating that you do not have a zero balance account in any other bank.
Wrapping Up
Zero Balance accounts are a great choice, especially during emergencies. The main reason is that you can withdraw all your funds to meet your needs without worrying about a minimum balance requirement. Take the time to choose the bank for your zero balance account since you can only open it once. To open an account with a new bank later, you must close your prior account.
