All you wanted to know about the Basic Savings Bank Deposit Account

The Basic Savings Bank Deposit Account (BSBDA) replaced No Frills Accounts that were hitherto allowed by banks. Banks have now converted the existing 'no-frills' accounts' into 'Basic Savings Bank Deposit Accounts'.

These accounts shall not have the requirement of any minimum balance to be maintained. This means that there would be no penalties levied, even if you maintain zero balance in your account.

The ‘Basic Savings Bank Deposit Account' would be considered a normal banking service available to all. What this means is that there would be no discrimination in terms of status and even the rich would be entitled to open an account of the sort.

Interestingly, the services that would be available to account holders would include deposit and withdrawal of cash at bank branch as well as ATMs; receipt/credit of money through electronic payment channels or by means of deposit/collection of cheques drawn by Central/State Government agencies and departments.

This means that despite being a zero balance account you can avail some important facilities while banking. In fact, according to the Reserve Bank of India the above facilities must be provided without any charges. Further, no charge will be levied for non-operation/activation of in-operative BSBDA Account'.

Holders of ‘Basic Savings Bank Deposit Account' will not be eligible for opening any other savings bank deposit account in that bank. If a customer has any other existing savings bank deposit account in that bank, he/she will be required to close it within 30 days from the date of opening a BSBDA Account'.

Conditions

The following conditions will apply for the BSBDA Small accounts:

i. Total credits in such accounts should not exceed one lakh rupees in a year.

ii. Maximum balance in the account should not exceed fifty thousand rupees at any time

iii. The total of debits by way of cash withdrawals and transfers will not exceed ten thousand rupees in a month

iv. Foreign remittances can not be credited to Small Accounts without completing normal KYC formalities

v. Small accounts are valid for a period of 12 months initially which may be extended by another 12 months if the person provides proof of having applied for an Officially Valid Document.

vi. Small Accounts can only be opened at CBS linked branches of banks or at such branches where it is possible to manually monitor the fulfilments of the conditions.

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