How To Open Zero Balance Account With Any Bank

Last updated on October 9th, 2023 at 01:01 pm

Savings Account is a basic type of Bank Account that can be opened by anyone with a minimum balance. But that does not mean it is suitable for everyone to open a savings account.

The need for each person varies with their Social and Financial position. Though savings account comes with the basic banking tools like ATM Card, Mobile Banking and Internet Banking, the banks usually charge for the each facility provided.

Even though banks are in their own rights to put these charges in the account, since they provide addition service to the customers. But this really confines the people from the weaker section from opening the account.

It is not feasible for the people from economically weaker section to maintain Minimum Balance requirements in the account. The charges levied on the non maintenance of minimum balance also takes money out of the people.

To counteract the issue RBI comes up with the solution of providing account with out minimum balance to every citizen. Now all the banks are mandatorily have to provide zero balance account to the customers.

Read further for details on what type of zero balance accounts are available and How you can open it.

Why there is Minimum Balance Requirement?

Operative Accounts (Savings Account and Current Account) provided by banks are always comes with the Minimum Balance Requirements.

The logic behind these requirements is simple. The banks provide more and more additional banking tools for every customers like ATM Card, Mobile Banking and Internet Banking.

These additional facility provided really increase the operating cost of the banks. To retort the effect banks are requesting the customer to maintain a minimum amount in their account.

Maintaining minimum balance will increase the total deposit and lending capability of the bank. But if account does not have any balance the bank will in the end will lose money. Hence banks charge the customers for non maintenance of the Minimum Balance.

Need for Zero Balance Account

Because of the Minimum Balance Requirement the financially weaker section of the population were avoiding the bank accounts in the beginning of the 2000’s.

With the various Financial Inclusion schemes introduced by the Government, it become imperative that there is a need for account with a low or no charges to onboard every citizen with the financial services.

Thus RBI made it mandatory to provide a Basic Savings Account with the basic banking facilities without any additional charges by all banks.

There are two important zero balance account schemes

1. Pradhan mantri Jan-Dhan Yojana Account (PMJDY)
2. Basic Savings Bank Deposit Account (BSBDA)

1. Pradhan mantri Jan-Dhan Yojana Account (PMJDY)

Pradhan Mantri Jan-Dhan Yojana (PMJDY) was introduced in 2014 under the National Mission for Financial Inclusion mission.

The scheme provides basic savings account with the credit/remittance facility. It covers the Economically Weaker Section and Low Income Group people.

Features of PMJDY

• PMJDY comes with the zero minimum balance requirements.
• Any inidividual attained the age 10 can open PMJDY account.
• Rupay Debit Card can be obtained and does not comes with issuance or annual renewal charges.
• You can open multiple PMJDY account with multiple banks.
• There is an Accidental Insurance Cover of Rs.2.00 lac comes with the Rupay Debit Card and no premium is charged to the beneficiary for the same.
• There is a life insurance cover of Rs. 30,000 for the individuals who opened the account between 15th August, 2014 and 31st January 2015.
• There is a Overdraft Facility available with the PMJDY account. And is given to the one member of the family preferably to the lady of the house.

2. Basic Savings Bank Deposit Account (BSBDA)

BSBDA Account was introduced in 2012 for the perculating of the Financial Inclusion mission of the government. The Basic Savings Bank Deposit Account does provided option for opening account without any minimum balance.

With the introduction of BSBDA account the RBI issued guidelines to convert all the No Frills Account into the BSBDA Accounts.

Features of BSBDA

• Every Citizen is eligible for BSBDA account, but it can be availed only once by an individual. Thus you can not open multiple BSBDA accounts in single or multiple banks.
• You can convert your ordinary Savings Account to a BSBDA by submitting request with the necessary KYC documents to the Bank.
• The account does not have any minimum balance requirements.
• There is no charges levied for Non Operation/ Activation of Dormant Account Charges.
• Free Rupay Debit Card is provided.
• Nomination is compulsory for the operation.
• No limit on Number of Deposits.
• Aggregate of all the deposits in the BSBDA account should not exceed Rs. 1 lakh.
• The aggregate of all the Withdrawals and transfer in a month should not exceed Rs. 10,000 and the Account Balance at any time should not be more than Rs. 50,000.

Documents Required for the Zero Balance Account Opening

For both the PMJDY and BSBDA account any one of the OVD is enough for new account opening.

The Valid OVDS’s are

1. Aadhaar Card
2. Voter ID
3. Passport
4. Driving Licence
5. NREGA Card
6. National Population Register Certificate

If any individual does not have any valid OVD and bank can assess the customer as a low risk, the banks can open account under Basic Savings Account with the following documents

• Identity Card with applicant’s photograph issued by Central/State Government Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks and Public Financial Institutions.
• Letter issued by Gazetted officer with the photograph of the person.

How to open Zero Balance Account Online?

With the digitization of the data it has now become easier to open account online. With the E-KYC and Video KYC, you can open a account from wherever you are without visiting the bank branch.

Just follow these steps to open account with any bank.

1. Choose which bank you want to open account with. This is based on the availability of the bank branch near your home and the service provided by the bank.
2. Visit the Banks official website and look for the online services.
3. Click the link or tab with the Apply Online.
4. The new page will come with the requirement of basic details. Just fill all the details accordingly, you might prompted for the OTP verification of your mobile and email ID.
5. After filling the details it is necessary to upload the relevant KYC documents.
6. Submit the application.
7. Once the application submitted the banks will initiate a verification process. You might be contacted by the banks representative for any other details.
8. Upon verifying all the details your account will be opened.

Conclusion

RBI and Central Government in the quest to include every citizen of the country in the Financial Inclusion has introduced the zero balance accounts.

It really has helped the people by providing affordable account with the basic facilities. The growth in number of account opened after the introduction really tells the success of the initiative.

But be sure all the regulation and rules and open the account if it will be enough for you.