Most types of savings accounts mandate an initial deposit of money, which varies across various financial institutions. This typically ranges from ₹5,000 to ₹10,000. It also means you must have a minimum monthly average of this amount. This can be inconvenient and an obstacle for many. However, with a zero balance savings account, you are not required to maintain any minimum deposit, offering you a more convenient and stress-free banking experience.
Today, we will learn the benefits, eligibility criteria and instructions for opening a zero balance savings account. This will help you evaluate whether it is the right savings account for you or not. So, keep reading.
What is a zero balance savings account?
As the name suggests, this savings account does not require a minimum balance and will not be penalised if no balance is maintained in the account. This accessibility has made banking more inclusive, allowing everyone to manage their money without worrying about fees and charges.
What are the benefits of opening a zero balance savings account?
Zero balance savings accounts have several advantages. This includes:
Get attractive interest rates
Like traditional savings accounts, zero balance accounts allow account users to receive interest on their money. As a result, they are an excellent choice for those just beginning out in the financial world. While most banks provide attractive interest rates on these accounts, keep in mind that rates vary by bank. Therefore, check the interest rates provided by several banking partners to get the best offer.
Enjoy enticing rewards and discounts
When you open a zero balance account, you can obtain a debit card for a small cost. Many banks offer exciting cashbacks for transactions carried out with them. For instance, with PVR Debit Card for Kotak811 account holders, you can earn complimentary movie tickets and get reward points at every purchase, which can be used for future transactions. Some cards offer exclusive offers on merchant outlets, food courts, etc.
Can set up e-mandates
E-mandate allows individuals to authorise recurring payments. For instance, you can set up automatic payments by OTT media service providers, EMIs (Equated Monthly Instalments) and more. This way, you will never miss a payment and lose access to any of the services.
Can open the account easily
Whether online or offline, opening a zero balance saving account is hassle-free. With just your PAN card and mobile-linked Aadhar, you can easily open an account. The process is simple and straightforward, empowering you to take control of your finances.
Eligibility of zero balance savings accounts
To open a zero balance savings account, you need to fulfil the following requirements:
- You should have a valid Aadhar card linked to your mobile number.
- You should have a physical copy of your PAN Card.
- To complete video/virtual KYC, you should have a camera facility on your mobile.
Considerations of a zero balance savings account
To give you an overview of what exactly are zero balance savings accounts, we have also listed down some of the limitations associated with them:
Limited features:
Things like absence of free chequebooks and cap on the number of monthly withdrawals can pose limitations to individuals. Therefore, it is necessary to evaluate these factors before opening a zero balance savings account.
Less disciplined financial management:
Lack of minimum balance requirements can tempt you to spend more, possibly on unwanted purchases. This could potentially lead to mismanagement, which is not advisable in the long run.
Endnote
A zero balance savings account is a good choice for people who want to save money without maintaining a minimum balance. It can be a good option if you are new to banking, such as students or young professionals, or who have trouble maintaining a minimum balance. So, compare different zero balance savings accounts online and choose the one that offers attractive interest rates, exclusive perks, more flexibility and convenience.
