A zero-balance current account is one where there is no need to maintain a minimum balance. Most savings accounts require you to maintain some money in it, like ₹10,000 or so. This amount varies, but in this blog we discuss ways in which you can open a zero-balance current account
A current account is a type of account that allows limitless transactions. Current accounts differ from savings accounts because they don’t provide any interest on your balance. Usually, it’s most useful for business people and entities like public and private companies, partnership firms, and proprietors.
Unlike usual current accounts, zero-balance current accounts don’t require account holders to maintain any monthly average balance (MAB).
The monthly average balance (MAB) indicates the figure arrived at by adding the closing balance at the end of each day in a month and dividing it by the total number of days under consideration.
The minimum monthly average balance differs for every bank. Provided you opt for a zero-balance current account, you will not be required to maintain a minimum monthly average balance.
Here's a table illustrating the MAB to give you an example
In order to open this account, though, you need to submit appropriate KYC documents in addition to the bank’s zero-balance current account opening form. Note: Different banks may require different documents.
Once your application has been submitted, your documents will be verified and provided your form is approved, your zero-balance current account will be opened.
In order to be eligible to open a zero-balance current account that will primarily be used for business purposes, you need to fall under any one of these categories:
The documents required to open a current account online may vary for each bank, and current account type. Here are some general guidelines in terms of documents to keep handy:
Proof of identity
Proof of address
Photograph
Hindu Undivided Family
Partnership Firm
Private or Public Limited Company
Sole Proprietor
Trust
Opening a zero-balance current account can be a convenient option for individuals and businesses who want to make financial transactions without the need to maintain a minimum monthly average balance. Unlike traditional current accounts, these accounts offer greater flexibility and cater specifically to the needs of business owners. By opting for a zero-balance current account, individuals and businesses can enjoy advantages such as managing erratic cash flows, maintaining longer debt collection periods, and having more control over their working capital.
Yes, you can open a current account online. There are a number of banks that offer opening current accounts virtually.
Personal current accounts can be opened by anyone with valid KYC documents. These include Identitiy proof and address proof. The actual documents may vary from bank to bank and type of current account.
To open a current account, just log onto your preferred bank's website and download their application form. Fill it out, upload the necessary documents, and hit submit. Once they verify everything and give you the thumbs up, your account will be good to go. They'll let you know when it's all set!
Choosing a bank that works best for you completely depends on what you need from a current account. That said, here are some top current account providing banks -
a. Axis Bank
b. IndusInd Bank
c. HDFC Bank
d. Kotak Mahindra Bank
e. SBI
f. ICICI Bank
g. Karur Vysya Bank
h. Yes Bank
i. Bank of Baroda
A zero-balance free current account is a current account that does not require a minimum amount to keep it running. Even with zero-balance, the account holder will not be charged penalties or fines.
1. What is a zero balance account? Here's everything you need to know
2. Difference between zero balance account and salary account
3. Zero-balance account vs Normal account - Know the difference
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