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What is a Zero Balance Account?

Savings Accounts

Banks offer savings account, a type of deposit where you can deposit your money and savings. In most cases, savings account come with a minimum average requirement that you need to maintain to avoid paying maintenance fee. Depending on the bank the minimum balance can be calculated on a monthly or quarterly basis.

Also, you receive interest on your deposit.      

What is Zero Balance Bank Savings Account?

Zero balance account is a kind of savings account with zero charges on non-maintenance of balance. This means that the account gives you the flexibility to spend without worrying about maintaining a minimum average balance.

Types of zero balance savings accounts

There are three main types of zero balance savings account. Basic Savings Bank Deposit (BSBDA), Basic Savings Bank Deposit (BSBDA) Small Account and accounts opened online through Aadhaar OTP authentication.    

Online Zero Balance Savings Accounts

Online zero balance accounts are savings account that you can open instantly online through Aadhaar OTP authentication. However, not all online savings accounts are zero balance accounts.

Indian citizens above 18 years of age can open the account. Generally, these accounts are meant for individual use and joint accounts may not be available.

 You can download the bank’s mobile banking app or fill the online account opening form to open the account. PAN, Aadhaar card and Aadhaar linked mobile number are needed to open the account. The account is opened after successful verification of the Aadhaar OTP.  These account are e-KYC accounts and are valid for 12 months by visiting the bank branch or meeting with a bank official with the required KYC documents. Few banks also provide with the facility to complete your KYC process through the Video KYC process.  

Basic Savings Bank Deposit (BSBDA)

Having a bank account is the sign of financial inclusion. However, in India, many people don’t have a bank account. So, Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched in 2014 to ensure financial services to everyone. Basic Savings Bank Deposit (BSBDA) is the bank account opened under PMJDY.  

People who have other bank accounts are not eligible to open BSBDA.

Individuals above 18 years with a valid photo id proof and address proof can open the account.  Accounts opened through valid KYC documents don’t have any restrictions.

BSBDA Small Account:

Individuals who don’t have a valid Photo ID proof and address proof as per the bank’s acceptable list of documents can open a BSBDA Small Account by submitting a self-attested photograph and signature/thumbprint.

Customers need to provide KYC documents within 12 months from the date of account opening to continue using the account. If unable to furnish documents within 12 months, customers need to provide evidence of application of the KYC documents. In this scenario, the account can be extended for another 12 months.

However, as the account is opened without any KYC documents, several restrictions are put in balance. The total balance in the account should not exceed Rs. 50,000 at any point of time. Also, the total credits in all the account should not exceed Rs. 1 lakh at any point of time and the total withdrawals and transfers in the account should not exceed Rs. 10,000 in a month.

Features of Zero Balance Accounts

Zero Balance Saving Account has different features. Here are some of the features.  

No minimum average balance: Many depositors may not be able to maintain an average balance. Zero balance savings account solves this problem. These zero balance accounts don’t have any minimum average balance requirement so you can utilize your money without thinking about maintaining the minimum average balance.

No initial deposit: In case of a regular savings account, banks charge an initial deposit amount that customers need to pay on account opening. However, zero balance accounts don’t have any initial deposit amount.

Earn Interest: Account holders receive interest on their zero balance accounts just like a regular savings account. The interest earned from the deposits is credited at the end of every quarter.  

Passbook: Customers receive passbook to check their account activity.  

Debit Card: Debit card is also available for zero balance account holders. Basic savings account holders get a free RuPay Debit Card that they can use to carry out transactions within India.

However, for online savings zero balance account customers, the issuance of debit card will depend on the bank.

Cheque book: Zero balance customers can avail cheque book facility. A cheque is considered as a valid proof of bank account for different uses such as investing in stocks and mutual funds among others.  

Internet Banking: Internet banking facility is another feature of the account. Through internet banking, customers can transfer money, pay bills, shop online instantly without spending any cash.

Other banking facilities: Customers who have completed the KYC process can avail different banking products such as Fixed Deposit (FD), Recurring Deposit (RD) that can help you save money for the future.    

Conclusion: Zero balance savings account is like a regular savings without any minimum average requirement. Basic Savings Bank Deposit Account can be an ideal financial tool for customers to enter the formal banking system and gain various financial assistance.

Individuals above 18 years of age with a PAN card and Aadhaar card can open an online zero balance account like Kotak 811 from the comforts of their home without any paperwork.

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Best Second Hand Car in 2016

The second hand car market is growing steadily in our country like the market for new cars. Going ahead with the plan of buying a second hand car depends firstly on the budget that you have set for purchasing a car. So the budget includes basic cost along with taxes and other charges too. The other factor to be considered is the comparison. While it is good to purchase a new car with the addition of some extra money than a used car, but if the car we are looking at has been driven by experienced hands and is evidently in a satisfactory and healthy condition after a close inspection, then it is an intelligent step to opt for that used car. Test drive, service record, mandatory papers and negotiation are the main factors to discuss about second hand cars. Here we have listed below some of the best second hand cars in India in 2016, in the different segments, with their features highlighted and expected resale value for the buyers.

Used Honda Civic - This mid-sized sedan from Honda has set a standard in the second hand car market. The Honda Civic looks simple yet elegant from the front and side. The 1.8 litre i-VTEC engine is available with both automatic and manual transmission and produces 132 PS output at max with 6300 rpm. The seating and cabin is quite spacious. The used Civic can be valued around INR 3.3 to 3.5 lakh resale value when average distance covered touches 50000 to 70000 km mark.

Used Maruti Suzuki Alto - The Alto K10 AGS has been awarded the BBC top gear idea of the year prize due to its design, performance, technology and safety. The Alto K10 hatchback drives on a maximum power of 68 PS@ 6000 rpm and accelerates from 0 to 60 kmph in only 5.3 seconds. It offers the best in class fuel efficiency of 24.07 kmpl with both the manual and automatic gear shift versions whereas the CNG model offers about 32.2t6 kmpl. This car with an age of 3 to 4 years and driven for about 20,000 to 30,000 km can be a fair buy for INR 2.5 to3.0 lakh.

Used Mahindra Scorpio - This SUV is perfect for long road trips with the family and great for braving different terrains as well as the perfect vehicle for off roading due to its robustness and reliability. A used Scorpio with a four wheel drive option delivers excellent performance in the city also, therefore making it the most wanted second hand SUV that offers great value for money. A 2012 Scorpio can be bought at 7 lakh with 57000 km average.

Used Honda CR-V - If you can afford a SUV with a powerful engine  that feeds on petrol or even just add a CNG kit to this car and with approximately 70,000 km showing on its odometer can easily be available in the used car market at around Rs 5 lakh range in the country.

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Pre Owned Cars or New one - Pro and Cons

Out of the thousands of questions which pop up in our minds when plans to purchase a car, the very common and basic one is perhaps, whether we should buy a brand new car or go for a used one.

Buying a new car has certain positive points - we get a brand new car which is most importantly unused and along with that we also get the latest technology that is on offer as well as the best warranty program without paying extra. The latest technology which is offered to us provides better safety and more fuel efficient engines with lower levels of emission. Also financing a brand new car is easier than getting finance schemes for a pre-owned car, and we also do not have to pay extra bucks for its maintenance at least till some time. And most importantly, not much physical effort is needed from our end while buying a new car, because most of that is done by the car dealer who provides the car specifications that we look for. The same does not happen while buying a used car since we have to physically go and visit each and every seller, to inspect the car and check it thoroughly before buying it.

In spite of all the advantages of buying a new car, the used car market is also flourishing rapidly. There are several reasons for this as well.

Though interest rates on new cars tend to be less, the overall cost of used cars even after adding the interest amount is found to be much lower than the cost of the same new car. The positive side of this is that we can afford a better car which we would probably not be purchasing new, due to budget limitations. Now, not only can you ride a nice model, but also at a much lower cost. So this provides more number of options to choose from. All cars depreciate in worth in terms of their cash value, with every month and mile. The maximum depreciation happens right when we purchase a brand new car. But for pre owned cars, there is no value depreciation again. Cost of a new vehicle includes different types of taxes but getting a used car from a private seller excludes these random charges.

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How to Get The Best Deal on a Certified Used Car

All brand new cars are identical to each other in the sense that every new car on a dealer's lot which has the same mechanical configuration also has the same cost price, mileage and is in the same condition as the other one. Then, after they have been purchased and owned, three years later, they all lose their similarities, then they are all different from each other. Consequently, shopping for a new car is totally different than purchasing a used car. And shopping for a certified pre owned car is still different, that blends in characteristics of both new and used car searches. On one hand, no two CPO cars have identically same mileage or are in the identically same condition, which means you could find yourself having to measure the pros and cons of two otherwise same models of cars. On the other hand, all of them do meet certain conditions and mileage criteria, and most of them offer an extended warranty program, which brings us peace of mind. So in a nutshell, buying a certified pre owned car might require more effort than buying a brand new car, but involves fewer perils than buying used car from private sellers. In order to get the best deal while buying a CPO car, there are few things that can be followed.

Also Check Used Cars in Bangalore

Start with one particular model – Keep in mind the models of cars that you want to buy, but so keep some backup options too, in case the one that you desire the most is not available at the dealership store. The more choices that you have as the purchaser, the better it will be for you.

Check the cars and warranty program– You have to do some homework that is research before buying the car. Check out the maximum mileage and the age of the cars. Also do not miss to check the details of the extended warranty program that is on offer. Reading the policy details is very important. It is also essential to check the history report of the vehicle to know whether the car had faced any damages earlier.

Check for CPO models – Once you have made up your mind on the models of cars and the resprective programs on offer, you can find the CPO models that are up on sale on the Internet.

Then visit the dealer – You must remember that prices of the CPO cars are also negotiable, like they are for any other used cars. But it is better to not expect big bargains on them. Check if any scheme for financing the car is available, that is comparable to that for any new car.

These few tips can help you save money and bring you peace of mind, when you buy a CPO car. buy used cars

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Automobile Companies Flummoxed by Rapid Boom in Used Car Sales

With a growing consumer market, exponential growth in e-commerce and offers backed by manufacturer's, brands in the pre-owned car market are witnessing heady growth like never before. The ratio of new to used cars has currently grown to 1:2.2 as per CRISIL’s latest study. For every 10 new cars sold in the country, 22 used cars are finding new takers. With the decline in vehicle holding periods to three years from six years, the used car supply has gone up hugely according to market sources. The new passenger vehicle market will be closing at around 2.8 million units this year according to market sources.

According to experts, the growing number of aspiring car buyers, shorter holding periods and increased participation of organized and original equipment manufacturer backed brands in the used car market in addition to financing accessibility options and refurbished and certified car availability are fueling immense growth in the used car market in India. CRISIL has garnered the data from its own model for used car sales in addition to details that are taken from multiple organized used car dealers. Maruti True Value, Mahindra First Choice, Hyundai H Promise and Carnation Auto are biggies in the organized used car category.

Organized players have also been amazed by the huge demand for used cars. The per capita income is going up and people are more amenable towards exploring the used car buying proposition irrespective of whether it is their first car or not. According to Rajeev Dubey, the Group President of human resources & corporate services and the chief executive officer (aftermarket sector) at Mahindra & Mahindra, the ratio of used cars sold to new cars sold may even be higher than the official forecasts going by the huge spike in demand.

Seven out of ten pre owned cars sold in India are hatchbacks while the rest is taken up by luxury models and sedans. Maruti Suzuki is the number one choice for used car buyers owing to easy maintenance, reliability and high fuel economy. However, Mahindra & Mahindra is fast catching up with the same value propositions and is going neck to neck with Maruti Suzuki in this space. Other brands that are favored by customers include Hyundai and Honda. Additionally, used car buying mirrors new car markets by way of buyer requirements and preferences. Brands that are overlooked at times but come at attractive prices with full features in the used car market are instant successes according to experts.

The used car market in India is still at a nascent stage in spite of the heady growth according to analysts. There is ample room for growth as far as the organized players are concerned. The organized sector takes up around 17% of the used car market since the market is still largely unorganized. However, this will soon change according to industry experts.

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