For many Indians, a Savings Account is out of their limits, mainly because it requires maintaining a certain minimum balance. The economically weaker sections find it challenging to consistently meet this requirement. To alleviate this, the RBI has introduced a Zero-Balance Account.

The Zero-Balance Savings Account does not have a minimum balance. A BSBDA has a maximum balance that the account holder must maintain. The concerned account holder receives a Debit or ATM Card as part of the account opening formalities. They get a free passbook and need not pay a penalty for not operating the account. The bank lets you fulfil a certain number of cash withdrawals and deposits in the month free of cost.

Other facilities offered

Banks also provide other facilities to their customers, such as email statements, a chequebook, Demand Drafts, cheque collection, etc., either free of cost or at a nominal charge. They offer the same interest rates on these accounts as they do for a Regular Account.

Terms and conditions

Since BSBDA is a no-frills Zero-Balance Account, some conditions are placed on it to serve someone from the economically weaker sections, and keeping those customers in mind, they are valid. These include:

1. An upper limit on the balance that needs to be maintained. This amount is set by the bank and usually differs upon comparison.
2. An upper monetary limit on the total of credits made to this account in a year.
3. An upper monetary limit on the withdrawals made in a particular month.
4. A maximum of four withdrawals in a particular month.

If the account does not satisfy these conditions, the bank turns it into a Regular Account. Note that an account holder cannot have a Regular and a Zero-Balance Savings Account in the same bank. The bank can turn it from a Regular Account to a BSBDA Account if the holder abides by all the conditions.

How to open one?

To open a Savings Account online, you need to ensure that you are not holding another account type with the same bank. Your KYC should be duly completed, and your IDs should not match what the bank has stored in its details. If a customer has a Regular Savings Account, they need to submit an undertaking to convert it to a BSBDA Account.

The Regular Savings Account will shut, and a BSBDA Account will open. With the funds from the BSBDA Account, you can open Fixed and Recurring Deposits with the bank.

Conclusion

Opening a BSBDA is excellent for those who worry about meeting minimum balance requirements and do not have many credits or debits in the account.