With the advent of digitalisation, banks now offer many of their services online, including the option of opening a new Savings Account. Two of the most common options for Savings Accounts are the traditional Savings Account and the Zero-Balance Savings Account.
While both allow you to save, spend and withdraw money as required, their features and limitations vary.
In this blog, we will examine a traditional Savings Account and zero balance account. We will also look into key features and how to open zero balance account online in detail; and help you decide which one works best for you.
What is a traditional Savings Account?
A traditional Savings Account requires the maintenance of a minimum balance in your account at all times. However, you can easily apply for one online via the bank’s official website or mobile app.
With a traditional Savings Account, you get access to all banking services, receive personalised customer support, and access chequebooks, passbooks and more.
What is an online open Zero-Balance Account?
A Zero-Balance Savings Account allows you to deposit and withdraw money without being required to maintain a minimum balance at all times.
This flexibility is beneficial for students, first-time account holders and low-wage earners. It allows them to manage their money and withdraw as required without the risk of deductions due to low fund balance.
Traditional vs Online Open Zero-Balance Accounts
Let’s take a look into the differences between both accounts before you proceed to open bank account online.
| Parameters | Traditional Savings Account | Zero Balance Accounts |
| Balance maintenance | Requires you to have a minimum balance in your account at all times | It does not require you to maintain a minimum balance at any interval |
| Initial deposit amount | Requires you to deposit a minimum amount at the time of account opening | No amount needs to be deposited when starting the account |
| Banking transactions | Both online and offline banking options are available | Both online and offline banking options are available |
| Cash deposits | It can be done at any branch | It can be made at ATMs or selected bank branches |
| Chequebooks and passbooks | Provided as a regular banking process | It may not be available with some banks |
| Customer support | In-person assistance at bank branches during banking hours and 24*7 online support via calls, SMS and emails | In-person assistance at bank branches during banking hours and 24*7 online support via calls, SMS and emails |
| Security | traditional banking security, SMS alerts and online banking safeguards | Advanced digital security with multi-factor authentication |
| Fees | Maintenance and penalty charges | Lower fees on online transactions |
| Cash deposit limit | There is no cash deposit limit | You can deposit cash up to a certain limit |
Traditional vs Online Zero Balance Accounts: Which one should you choose?
If you are planning to open a bank account online, choose –
A traditional Savings Account if:
● If you frequently deposit cash and require chequebooks
● If you want higher transaction limits
● If you want the flexibility of both online and offline services
An online open Zero-Balance Account if:
● You want a hassle-free, digital banking experience
● You do not want the pressure of maintaining a minimum balance
● You want more spending freedom
Conclusion
Both traditional Savings Accounts and online Zero-Balance Savings Accounts have pros and cons. Before you open a bank account online, read through all the prerequisites, features and limitations to avoid any confusion in the future.
