Zero-balance account

Reviewed by Annapoorna | Updated on Dec 07, 2022



There are numerous benefits of having a deposit with the bank. Primarily, the money that you earn and save will garner decent returns for you if you deposit at the bank. Hence, with bank deposits, you may not only earn interest but also ensure its safety. Get easy access to money, and enjoy a nil risk.

Recently in India, especially between the period 2014 to 2019, there was a major increase in the number of savings bank accounts, due to various government schemes and demonetisation. With these, even the zero balance account came into being.

What is Zero-Balance Account?

A zero-balance account refers to a savings bank account, which has a zero balance in it and yet not charged. It is legally known as Basic Savings Bank Deposit (BSBD) account as per the Reserve Bank of India (RBI) guideline. The facility is provided by banks to encourage more savings among people.

The savings bank account is a deposit account with a bank, usually maintained by individuals, either by self or jointly with another individual. An ideal savings bank account usually needs a minimum balance to be maintained by the account holder. But in the case of zero balance account, despite nil balance, the bank will still give all the usual facilities that come with a regular savings account.

Zero-balance accounts usually allow a limited number of transactions per month, usually around four. If the limit exceeds, then the bank will convert your zero-balance account into a regular savings account.

Why Should You Invest in a Zero-Balance Account?

Some of the benefits of opening a zero balance account are as follows:

1. No Minimum Balance Account-holders are not charged fees for maintaining a nil balance or minimum balance. Ideally, it attracts more savings bank account openings.

2. Free Benefits All the individual account holders are given some facilities free of cost. These include free passbook and free cash and cheque deposits at any branch.

3. Other benefits The holders of a zero-balance account can get access to a debit card as well as ATM. They can also choose to opt for mobile and/or net banking. Apart from these, the safe deposit locker facility is also provided. The charges collected for these facilities are nominal.

4. Allows digital payments The account holders are given a card to make digital payments. These cards use the electronic payments gateway systems such as RuPay to make payments easily and conveniently online.


The intent of having basic savings bank deposit account was to improve the circulation of currency and stop hoarding of cash, especially rural and semi-urban towns and cities of India.

Accordingly, the lateral facilities provided with the zero-balance account, such as insurance will assure a sense of security to the lower and middle-income groups.

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