A zero balance account (ZBA) is an account that maintains a zero balance by transferring funds to and from the main account.
ZBAs are not consumer goods, but are used by large enterprises.
An organization may have multiple sub-accounts with a zero balance to monitor and track expenditure by department or project.
ZBA helps reduce risk because the company has more control over where its cash balances are located and what unauthorized spending may occur.
ZBAs are also usually heavily automated. While this limits clerical errors and improves operational efficiency in some way, the company must still track and reconcile its bank statements.
The account balance represents the available funds or present value of an account of a particular financial account, such as a checking, savings or investment account.
A canceled check is a check that has been redeemed by cashing or depositing it, making the check invalid for further transactions and cannot be reused.
Overdraft protection is a guarantee that a check, ATM, bank transfer or debit card transaction will be canceled if the account balance falls below zero.
The 3-6-3 rule is a slang term for an informal practice in banking, especially in the 1950s, 1960s and 1970s, that was the result of the industry’s uncompetitive and simplistic conditions.
The annual equivalent rate (AER) is the actual interest rate on investments, loans or savings accounts that can be obtained after compounding interest.