What's a Zero Balance Account?
A Zero Balance Account (ZBA) is designed for companies that maintain a general operating account and separate accounts for payroll, petty cash or other purposes. All of the company's funds are concentrated into one operating account, and disbursements are made from subsidiary accounts, which always maintain a zero balance. This system allows for increased account control and reduces administrative expenses.
How it works
- All funds are deposited into a central operating account
- Subsidiary accounts to handle payroll, petty cash or other similar needs always maintain a zero balance
- Each day, the total for all checks presented against each ZBA is offset by a debit to the central operating account
- Transfers from the central operating account to the subsidiary ZBAs are cross-referenced by account number on the bank statement
- Deposits accidentally made to your ZBA accounts will be automatically transferred to the main account
- Eliminates time spent on manually funding subsidiary accounts
- Eliminates the need to track balance levels and funding requirements
- Saves clerical time and expenses
- Maximizes funds available for investment and minimizes risk of overdraft fees
- Permits easy tracking of transfers and reconciliation through cross-referencing account numbers on bank statements
- Excess funds in the central operating account can be invested to increase returns and maintain liquidity
Ready to get started?
Have a Treasury Management representative contact you.
Locate a branch.