While savings accounts are the most popular bank deposit facilities, these come with certain constraints. Banks mandate account-holders to maintain a minimum account balance at all times. However, with zero balance savings accounts, you need not maintain any minimum account balance.

Here’s a look at the benefits of a zero balance savings account, alongside a few of its disadvantages.  

The Benefits and Drawbacks of Zero Balance Savings Account

The Government of India, under its Pradhan Mantri Jan Dhan Yojana, introduced Basic Savings Bank Deposit Accounts (BSBDA) to ensure better financial inclusion. Following this trend, several banks started to roll out a zero balance savings account which does not require maintaining a minimum account balance. 

Both government-backed and private banks allow individuals to open a zero balance savings account after a simple KYC verification. 

Pros of Zero Balance Savings Account

Following are some of the key benefits of opening a zero balance savings account. 

  • No minimum balance requirement 

As the name suggests, a zero balance savings account holder does not need to keep a minimum balance at the end of a certain period. It allows users to utilise their funds flexibly. Selected banks also allow customers to keep the account balance nil without charging non-maintenance fees. 

Moreover, the rate of interest levied on such accounts is the same as a normal savings account. You earn interest on the available balance, daily, monthly or quarterly, depending on the bank’s policy.   

  • Suitable for all 

Since there is no need to maintain a minimum account balance, anybody above the age of 18 years can maintain this account. Thus, it encourages more individuals to keep their savings safe with banks. 

  • Digital account facility 

Select banks also offer online zero balance savings account, which let you access this account digitally. Starting from KYC verification to deposit and withdrawal, everything action can be undertaken online. 

  • Debit card

Every zero balance savings account accompanies a complimentary debit card. Depending on the banks, you can get a either RuPay or Visa debit card and utilise it for online and offline transactions. However, depending on the type, the selected online savings account comes with a virtual debit card that can only be used for online transactions. 

  • Passbook and chequebook facilities 

Like traditional ones, a zero balance savings account also comes with free passbook and chequebook facilities. Individuals can also use the debit cum ATM card to access ATM facilities. 

  • Online funds transfer 

A zero balance savings account also supports almost all online transactional models, including mobile and net banking. You can also set up a UPI payment option with such accounts. Check your balance, transfer funds through RTGS, NEFT, etc., online with this account with ease. Recharging mobile phones, DTH, paying bills also become easier with such accounts. 

  • Overdraft 

After a stipulated number of days from opening a zero balance savings account, one can also avail of an overdraft facility. 

However, such accounts also accompany a few drawbacks that you should be aware of.  

Cons of Zero Balance Savings Account

Following are a few cons of zero balance savings accounts. 

  • Only the residing Indian citizens are eligible to open a zero balance savings account. 
  • Such accounts usually have an initial balance limit of Rs.1 lakh.
  • Often have a transactional limit of 3 to 5 times per month. 
  • If you do not use this account for a certain period, it becomes dormant like traditional ones. 
  • Such accounts usually do not support foreign remittances. 

Although a zero balance savings account comes with such limitations, the facilities otherwise are favourable for the common people. Individuals can open such an account and perform all operations that a traditional account allows without the need to maintain a minimum account balance.


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