January 19, 2021

Worried over minimum balance requirements? Here is a way out


With the spread of the COVID-19 pandemic, people all over the nation are facing financial problems, especially with salary cuts/delays, no-pay, layoffs, deferred payout, etc. On top of that when there is hardly any money coming in, it has become hard for people to maintain their minimum Monthly Average Balance (MAB). Account-holders who forget to maintain their MAB in their savings bank account get charged a hefty fine for it.

At one point, most bank account holders have cried over non-maintenance of monthly average balance in their savings bank account. It is not uncommon if you have been losing your own money to the bank due to non-maintenance of the minimum account balance.

If you are among those who are unable to maintain the required fixed amount monthly in your account or just don’t want to, there is a way out. You do not have to keep such an account active and keep paying fines on a regular basis.


You can get rid of maintaining a minimum monthly average balance, and opt for a zero balance bank account. Most banks offer this zero balance account, but they will not come forward and give you this option. You have to ask the bank for opting for a zero balance bank account. An account holder with a zero balance account, unlike normal bank accounts, will not be required to maintain any minimum average balance.

Zero balance accounts are usually salary accounts that are opened by the employer. With these accounts, employees are not required to maintain a minimum average balance. No additional charges are charged from the account holder for non-maintenance of the minimum account balance. Having said that, once you leave the company or when salary stops getting credited to your bank account, after 3 or 5 months depending on the bank, you start getting charged for non-maintenance of MAB. Most people fall prey to this as this point is usually not mentioned by the employer and most are not aware.

To avoid such circumstances, you can opt for a zero balance account. You can open a zero balance account, even if you are a non-salaried account holder of a bank. With this option, account holders will not be required to maintain a monthly average balance. Note that, the bank by themselves will not offer the zero balance account, the customer will have to ask for it. Starting from the State Bank of India (SBI) to HDFC Bank to ICICI Bank, IDFC Bank, almost all leading banks offer this option of opening a zero balance savings account.

For instance, with SBI’s Basic Savings Bank Deposit Account (zero balance account), there is no upper limit on the deposits that can be made. Similarly, the zero balance account of HDFC Bank offers a free Rupay card to the account holders along with passbooks, checkbooks, and ATMs free of cost. On their zero balance savings account, IDFC Bank offers its customers 10 free withdrawals per month, along with various other benefits.

Some banks, however, have some conditions for zero balance account holders. For instance, some banks come with certain conditions like account holders need to open an FD with the bank, or opt for a mutual fund SIP of a certain amount per month, to have a zero balance account. Hence, firstly find out from your bank if there are any criteria for opening a zero balance account.


Source:- financialexpress


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