Zero Balance Savings Accounts Interest Rates: SBI Vs Small Finance Banks

If you are looking to open a savings account, this might interest you. Large banks like SBI (State Bank of India) offer modest interest rates on savings accounts, including on zero balance savings accounts. However, small finance banks like ESAF Small Finance Bank and Equitas Small Finance Bank offer interest rates up to 7 per cent on zero balance savings accounts. Thus, these small finance banks not only offer the facility of opening a zero balance account like larger peers but also offer better interest rates on the same.

Given below is a comparison of zero balance accounts offered by Equitas Small Finance Bank, ESAF Small Finance Bank and State Bank of India (SBI):

Zero balance savings account of Equitas Small Finance Bank
Equitas Small Finance Bank offers basic and small savings accounts, both of which do not require maintenance of any average quarterly or monthly balance, according to its website equitasbank.com.

Facilities on zero balance account offered by Equitas Small Finance Bank
Customers of zero balance account of Equitas Small Finance Bank get a free RuPay debit card and are allowed access to the bank ATMs and branches for withdrawals.

Customers of zero balance savings account of Equitas can also access cheque clearing/ NEFT/ net banking/ mobile banking facilities of the bank.

Zero balance account of ESAF Small Finance Bank
ESAF Small Finance Bank's zero balance account can be opened with simple KYC or know your customer norms, which means that the customer verification procedure that the bank follows is simple, according to its website, esafbank.com. You do not require any initial deposit or minimum balance in the zero balance account. However, the total deposit is fixed at Rs 1 lakh per annum.

Facilities on zero balance savings account of ESAF Small Finance Bank
Zero balance account customers of ESAF Small Finance Bank get a RuPay debit card without any charge and the facility of linking the account with Aadhaar card number for receiving all the benefits in the account.

The bank also offers free monthly cash deposit transactions at non-base branch, 725 free cheque leaves every half year, and a passbook / e-mail statement facility.

ESAF Small Finance Bank also offers an accidental insurance cover up to Rs 1,00,000 to customers of zero balance savings account.

Zero balance account customers of ESAF are allowed to withdraw up to Rs 10,000 per day from ATMs, subject to a maximum of four free ATM withdrawals per month.

Zero balance account customers can access internet and mobile banking, fund transfer and utility bill payments, among other things.

Interest rates on zero balance account of ESAF Small Finance Bank
If you maintain a deposit up to (including) Rs 1 lakh, your zero balance account in ESAF Small Finance Bank will fetch you an interest rate of 4 per cent. If the zero balance account has a balance above 1 lakh up to and including 10 lakh, the interest rate is 6.5 per cent. If the balance in the zero balance savings account is over Rs 10 lakh, the interest rate is 7 per cent.

Zero balance savings account of SBI
Customers can open a basic savings bank deposit account with SBI provided they have valid KYC documents, according to SBI's corporate website, sbi.co.in.

Facilities of Zero balance savings account (basic savings bank deposit account) of SBI
A basic RuPay ATM-cum-debit card will be issued free of cost to the users of this zero balance account, said SBI. There is no annual maintenance charge. The receipt or credit of money through electronic payment channels such as NEFT and RTGS is also free. The deposit or collection of cheques drawn by central/state governments is free.

A maximum of four withdrawals are allowed in a month. These withdrawals include ATM withdrawals at own and other bank's ATMs and transactions through other modes including RTGS/NEFT/clearing/branch cash withdrawal/ transfer/ internet debits/ standing instructions/ EMI etc. No further customer debits are allowed during the month.

SBI does not charge anything on activation of inoperative zero balance savings accounts (BSBDA). There are no account closure charges, the lender said.

Interest rates offered on zero balance savings account by SBI:
For savings deposits balance up to Rs. 1 crore, SBI zero balance accounts will fetch you 3.5 per cent per annum. On savings deposits balance over Rs. 1 crore, SBI zero balance savings accounts offer an interest rate of 4 per cent per annum.