Understanding No Frills Accounts- Features, Eligibility, and Benefits

Learn what is no-frills account, its eligibility, documents required and how to apply.
Understanding No Frills Accounts
3 min

Different types of savings accounts form a key part of every economy. They are the most accessible instruments for accumulating savings for the general population and accruing interest. These savings also enable financial institutions to extend loans. In this way, an entire framework of saving and lending is established in a financial system. Owing to the ubiquitous nature of savings accounts and their benefits, it is important to learn about different types of savings accounts, including the no-frills account. In this article, we will understand the meaning of a no-frills account, its features and benefits, and eligibility to open such an account.

What are no-frills accounts

A no-frills account is a basic savings account with the primary feature of not requiring maintenance of a minimum monthly average balance. However, a no-frills account may sometimes require maintaining a negligible minimum balance. This savings account was introduced by the Reserve Bank of India (RBI) in 2005 with the primary objective of promoting banking services to customers with lower incomes. With this account, as long as the KYC norms are followed, you can avail of all the major banking facilities like withdrawals, debit card payments, etc., at no additional costs.

The no-frills account was discontinued in 2012 and renamed the Basic Savings Bank Deposit Account (BSBDA), which is what the no-frills account is known as today.

If you are looking for a safe investment option, you can consider fixed deposit. They offer guaranteed returns and a fixed interest rate throughout your investment tenure.

Features of a no-frills bank account

Now that we understand the conceptualisation and meaning of a no-frills account, let us take a closer look at some of its key features:

  • A no-frills savings account can be opened and maintained without a minimum balance requirement, essentially at zero balance.
  • With this account, you can avail of mobile and internet banking services, along with a debit card, free of cost. This promotes access to cash through ATMs present all across the country.
  • This account can be operated by you individually or as a joint account.
  • Quarterly account statements are provided to no-frills account holders over email
  • Overall, the levied service charges are significantly lower compared to other forms of savings accounts.


You can open a no-frills account if you fulfil the following criteria:

  • You must be an Indian citizen
  • You must possess valid KYC documentation
  • Minors over 10 years of age and pensioners can also open a no-frills account. Only NRIs and institutions are not permitted to have a no-frills account.

Also read: How to open a recurring deposit account


The documentation required to open a no-frills account is as follows:

  • KYC verification - The KYC process can be completed through documents like the PAN card.
  • Address proof - Documents accepted as address proof include a ration card, Aadhaar card, voter ID, and PAN card, among others.
  • Date of birth proof - You can use an Aadhaar card, ration card, or voter ID to prove your date of birth.

Benefits of no-frills accounts

Now, with clarity on the features and eligibility of a no-frills account, let us understand the advantages of these accounts. Here are some significant benefits of no-frills accounts:

  • Accessibility - With attractive features and relaxed eligibility criteria, no-frills accounts aim to bring more people into the fold of banking services to make it more inclusive.
  • Minimum balance - No-frills accounts require modest to zero minimum balance maintenance and can be an attractive option for many.
  • Unlimited deposits - There is no upper limit or an exact number of deposits you can make to your account.
  • Free debit card - All no-frills account holders can avail of an ATM card at no additional cost.
  • Specified withdrawals - No-frills accounts allow as many as four withdrawals in a month. This also includes the withdrawals made through debit cards.
  • No penalty for inactivity - No extra charges or penalties are levied even if you fail to operate the account for an extended period.
  • Nomination facility - Multiple banks offer nomination facilities in no-frills accounts to better serve the customers.
  • Internet banking - No-frills account holders can avail of the Internet banking facility. However, extra charges may be levied for the same.

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Also read: Post office PPF account

Important information regarding no-frills accounts

At this point, having a no-frills account may seem like an attractive option. It is understandable as you get numerous benefits at no additional costs. However, it is crucial to explore a few limitations of no-frills accounts as well. You can peruse the following pointers carefully, as it is information you must know before opening a no-frills account:

  • Only one no-frills account is permitted per person.
  • At one time, the maximum amount you can deposit in the account is Rs. 50,000.
  • Annually, the total credit in your account cannot exceed Rs. 1 lakh.
  • Without completing the KYC procedures, foreign currency deposits in no-frills accounts are not allowed.
  • If you have a no-frills account at a bank, you cannot open another savings account at the same bank.
  • In a month, the maximum withdrawal limit in a no-frills account is restricted to Rs. 10,000.

Summing up

No-frills accounts, presently known as Basic Savings Bank Deposit Accounts (BSBDA), are a vital tool promoting financial inclusion, aligning with the broader goal of making banking services accessible to all. These accounts, introduced by the Reserve Bank of India in 2005, primarily catered to people with modest incomes, offering banking services without the requirement of maintaining a minimum balance. Despite its simplicity, a no-frills account provides you with a range of benefits, including free debit cards, Internet banking services, and nominal service charges. However, it is essential to understand their limitations, such as restrictions on deposits, withdrawals, and foreign currency transactions. Nevertheless, with their focus on accessibility and inclusivity, no-frills accounts continue to play a crucial role in fostering financial empowerment and participation across diverse segments of society.

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Frequently asked questions

Are no frills accounts only for the economically weaker section?

No. No-frills accounts are aimed at promoting financial inclusivity. Anyone who wants to benefit from zero minimum balance requirements, among various other benefits, can open a no-frills account. Barring NRIs, institutions and organisations, any Indian citizen can opt for it.

What kind of services are free under basic savings bank deposit accounts?

As a no-frills account holder, you can avail of free banking services, such as cash deposits and withdrawals, sending and receiving money, debit card issuance, mobile banking, and Internet banking services. This enhances accessibility and convenience without any additional charges.


As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.