Zero Balance Savings Account: Services Offered, Rules, Facilities

The Reserve Bank of India (RBI) has been running advertorials to educate people about the facilities offered by commercial banks through basic savings bank deposit accounts (BSBDA). A basic savings bank deposit or BSBD account is a zero-balance account which does not require the customer to maintain any particular balance in the account. The BSBD account - offered by most lenders - comes with a free debit-cum-ATM card and a passbook without any charge. However, withdrawals from this account are limited, as mandated by the RBI.

Here are 10 key things to know about the basic saving bank deposit (BSBD) account, which offers a zero balance facility:

1. The holders of a BSBD zero balance account is not permitted to open any other savings account in the same bank, according to the RBI. If a customer holds any other existing savings account in the same bank, he or she is required to close it within 30 days from the date of opening the BSBD account. In other words, the customer cannot have any other savings bank account in the same bank.

2) However, in the same bank, along with the BSBD zero balance savings account, the customer can have accounts such as term/fixed deposit and recurring deposit, according to the RBI's website -rbi.org.in.

3) The services available for free in the BSBD zero balance savings account include deposit and withdrawal of cash and receipt/credit of money through electronic payment channels or by means of deposit/collection of cheques at bank branches as well as ATMs.

4) There is no requirement for any initial deposit for opening the BSBD zero balance account.

5) Banks are free to offer more facilities than those prescribed for BSBD holders. However, the decision to allow services beyond the minimum prescribed has been left to the discretion of the banks, says RBI.

(Also Read: State Bank Of India Accounts That You Can Operate With Nil Balance)

6) If a BSBD account holder customer carries out more than four withdrawals or requests for a cheque book at additional cost, the account will cease to be a BSBD account.

7) However, if the bank does not levy any additional charges and offers more facilities free of cost than those prescribed under the BDBD zero balance savings accounts without a minimum balance, such accounts can also be classified as BSBD accounts, according to the central bank.

8) Balance enquiry through ATMs should not be counted in the four withdrawals allowed free of charge at ATMs.

9) The BSBD account holder should be offered a passbook facility free of charge as per RBI instructions.

10) A regular savings bank account can be converted into a BSBD zero balance savings account at the request of the customer. Such customers should give their consent in writing and they should be informed of the features and extent of services available in BSBD accounts, according to the RBI.