At HSBC "No Minimum Balance" Actually Means $0.01

Reader Erin found out that when HSBC says, “no minimum balance,” they actually mean, “at least $.01.” What seems like an innocent misunderstanding is actually going to cost Erin some time and trouble. It all began when she had to empty one of her HSBC accounts to make a large purchase. Because her account required no minimum balance she assumed all was well, until she went online and found out that HSBC had conveniently closed her account which can only be reopened in person. Erin writes:

Just wanted to pass on a recent frustrating encounter with HSBC. My boyfriend and I have four accounts with HSBC- checking, savings, line of credit and credit card. When opening the savings account- their Money Market, interest-bearing savings option- we made it very clear we wanted an account with no charges and no minimum balance requirements. We were assured the Money Market account mentioned above was just the thing we were looking for. We received this assurance both verbally from the customer service person when opening the account and in the accompanying printed terms of agreement.

Fast forward six months…we drain our savings account yesterday (afternoon by the way) to purchase an engagement ring. First thing this morning I log into the HSBC online banking service to transfer some funds into the savings account to start replenishing the account. “Account unavailable” is the error message I receive. Call customer service and ask immediately to speak to a supervisor (lesson learned from reading many of the tips on your your site over time). I am informed that because the savings account was $0.00 the account automatically closes. I informed the supervisor that the terms of the account do not require a minimum balance. She investigated and agreed, telling me yes, this account does not require a minimum balance. So again, I asked why the account was being closed. Again, “because it has a zero balance.”

In our experience, most banks will even go as far as issuing a negative balance while keeping the account open. We can’t understand why HSBC would simply assume you wanted to close the account because of a zero balance. So take it from Erin, keep at least a penny in your HSBC “no minimum balance” account, unless you want to go through the rigamarole having to reopen it later. Last place in customer service sure must be a coveted title since it seems like HBSC is fighting hard to keep it.
(Photo: Getty Images)

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  1. mantari says:

    Perhaps “no minimum balance” means that you have to have a balance? Since $0.00 is no balance, it isn’t acceptable. However, a -$1.00 balance would be?

  2. ecwis says:

    This is typical of any account. They close them after having a $0 balance for a while.

  3. mgy says:

    She investigated and agreed, telling me yes, this account does not require a minimum balance. So again, I asked why the account was being closed. Again, “because it has a zero balance.”

    I don’t know if there’s any comment that can adequately express just how baffled I am at this supervisor.

  4. Look, guys, if you can understand “.002 dollars vs. .002 cents” then why can’t you understand “no minimum balance vs. 0 balance?”

  5. Same thing happened to my mother-in-law. I guess it’s disclosed somewhere in the stacks of papers new account holders get from HSBC, but it did come as a surprise to her (and us).

  6. EWGF says:

    Maybe they only work with positive integers?

    Seriously though, all places I’ve seen always have a $0.01-$1 minimum or else closure. This doesn’t surprise me, although I do feel sorry for the inconvenience she must have experienced.

  7. mmbb says:

    I should be allowed to open up as many of these “no minimum balance” accounts as I want, then?

  8. KD17 says:

    I’ve had accounts where there was no minimum balance needed but the terms of agreement stated that an account with 0.00 balance with zero activity for so long would cause the account to be closed.

    Perhaps something was ( Not Clearly ) stated in their terms of agreement and it was just missed or maybe it’s not in their at all.

    I always get a headache reading through them.

  9. projoe1979 says:

    How hard is it to open a new account? I went through the online process and I thought it was pretty simple and quick.

  10. Pro-Pain says:

    A zero balance is NO BALANCE. Seems easy to me.

  11. azntg says:

    So, if anything, all of us should learn from Erin’s experience: Next time you intend to withdraw the entire balance of your account, deposit one cent in advance ;-)

  12. Myotheralt says:

    @ecwis: @KD17: so, 6 hours is long enough to say the account is inactive?

  13. nybiker says:

    @ecwis:

    “For a while” I can understand. But one day? That seems kinda fast. While it was over 11 years ago, Citibank had closed my checking account at year-end since my checking account had hit zero (I kept nothing it unless I was paying a bill). When I investigated, it turned out that someone generated a report of all zero-balance accounts and saw mine and closed it. The policy I was told was to close the accounts if there was no activity during the past 6 weeks. Mind you, I got paid via direct deposit every two weeks and had a savings account as well. Even then they said, keep a dollar in the account. I said no. They did it again 6 months later. But I was able to get them to reactivate the account that night and prevent any bounced checks. They haven’t done it since.

  14. Dobernala says:

    @Pro-Pain: Zero is a value. If 0 can be numerically compared to 1, 2, 3, etc. then the term “no minimum balance” should be mathematically valid for a balance of 0.

  15. BigElectricCat says:

    @Pro-Pain:

    “A zero balance is NO BALANCE.”

    No. An account with no funds in it is an account with a zero balance. Your balance is zero. Not null or nonexistent.

  16. KD17 says:

    @myotheralt: Oh I wouldn’t agree with 6 hours being long enough but I wouldn’t put it past them having some where in the agreement something saying accounts with a zero balance at the close of a business day will be closed. That no minimum balance only means no there is no monetary fine for carrying a low or zero balance.

    You would really have to read through their agreement to see if they have anything tricky in it.

    With all the crazy things we have all read companies,banks etc… doing I put nothing past them.

  17. BeThisWay says:

    The “no minimum balance” statement is in regards to fees, as in you incur no fees if you fall below a certain balance. It has nothing to do with the bank closing the account for a zero balance.

    Still, I’d think they’d wait for 14 or 30 days of zero balance before closing those accounts. Someone needs to reprogram their computers.

  18. Buran says:

    “I was attempting to place a balance in it. Please re-open the account.”

  19. Dobernala says:

    @BeThisWay: So what you’re saying is that there is a minimum balance.

    I love all these people who are trying to help HSBC weasel out of the reality of their marketing slogans.

  20. EllenRose says:

    It could be worse. I seem to remember, in the recent past of Consumerist, banks unilaterally re-opening closed accounts and charging them fees, then sending it to a collections agency.

  21. English, MF, do you speak it? says:

    ING Direct truly has a no minimum balance policy. I had an account with $0.00 in it for a couple years there without any hassle from them.

    Actually, I recently cleaned out an online HSBC savings account, but when I called to close it, I was told I needed to mail a letter somewhere. Maybe they’ll close it automatically for me, I should check.

  22. Falconfire says:

    Could this be because HSBC has no means of actually closing their accounts online?

    I tried for weeks to get them to close our savings account since I transfered it to a credit union. Finally I just removed all the money. 2 months later all done!

  23. ColoradoShark says:

    It looks like it’s up to me to blame the OP. Sheesh!

    Why did they fall for the DeBeers scam where you have to plunk down a big pile of money for some rock they dug out of the ground? If you hadn’t have done that you wouldn’t have run into this issue.

  24. drzombie says:

    @ColoradoShark:

    Really? Have we sunk so low that if we can’t find something else to blame the OP about we’ll blame them for their buying habits, which is really totally unrelated to the problem at hand and just extra information anyways? With your holier than though attitude you must have never made a purchase that wasn’t completely rationale.
    Unless you were being sarcastic, in which case good show chap. She should also be blamed for calling him her boyfriend since that is so politically incorrect, he’s obviously her significant other! I bet she shops at Best Buy too

  25. vastrightwing says:

    I rate HSBC right up there with BOA, Best Buy and Sears! There should be truth in advertising such that most reasonable people would agree that when a business advertises something, most people would understand it to mean… without having to actually dig through 10K of fine print to discover it means something different.

  26. scoosdad says:

    Well I had a zero balance interest checking account with Bank of America that was empty for years with no activity, and it took me three phone calls and a trip to the local branch just to get them to close it.

    The first agent I spoke to said, “well you can’t close that account sir, that’s your primary account!” It was linked to another interest checking account that I was using, and an overdraft line of credit though; that may have been the difference in this case.

    And of course when they closed the empty account, the other checking account mysteriously changed to a no interest account. Took another two phone calls to fix that. “Oh we forgot to move your preferred status to the other account when we closed the empty one…” Grrrrr.

  27. camman68 says:

    @projoe1979: It can be very difficult. I opened a new account at a bank close to my house because they also have branches in the city I am moving to. First, you open the account and they give you counter (starter) checks which no one will accept other than the bank. If you want online service, you have to register on their website. Then you wait a week for them to snail mail your user ID and password. At that point, you can view your account. From there, if you want online billpay, you register again and wait for them to snail mail another registration. By the time all is said and done, it took almost a month to get a useable account. (The same process is true for savings accounts – other than the starter checks).

  28. Jay Slatkin says:

    @projoe1979: The accounts opened online and brick and mortar accounts are separate, each with its individual rules. The OP is a brick and mortar customer.

  29. ColoradoShark says:

    @drzombie: Here’s another fine example of face to face communication being way better than the written word. My comment was totally sarcastic. Of course, it could turn unsarcastic if they coughed up the same amount as a new car for a diamond ring.

  30. MarkMadsen'sDanceInstructor says:

    I don’t have too much sympathy for this woman. I can understand how technically you can think no minimum balance means $0, but literally withdrawing every last cent from your account seems to me like a sign that you’re closing your account. Now, if she had left $0.05 and they closed it, I could understand her outrage.

    On the other hand, HSBC should do what ING Direct does. When you withdraw the last amount from your account, it tells you that taking the balance under $1 will close your account and asks you if you really want to do it.

  31. Copper says:

    @Jeff from LA:

    1. I had a Bank of America no-minimum savings account that had a $0 balance for about six months, then I closed it because I have no savings (I’m a student, I need all my money right now.)

    2. I currently have a USAA and ING Direct savings account, both with a $0 balance. It’s been that way for a few months. They haven’t been closed.

  32. rcenek says:

    HSBC is well known for its questionable practices, as our household rudely learned about 8 months ago.

    We had a billing issue with them in which we were told that we could appeal. HSBC’s appeal decision never forwarded to us. Six months later we received correspondence from Houston Funding II, LTD (almost sounds like a car hey)that we are debt beats, that HSBC has sold our bad debt to them and they wish to collect. We were prepared to pay HSBC the full amount. We simply wanted them to consider our circumstances. We can not even get anyone at this point to correspond with us. Their crew seems to follow orders more efficaciously than a Walmart customer service employee.

    Next stop…..Monana Attorney Generals Office. Our situation is not a bid deal, but monolithic firms of this size need to get toasted more often when they pull this ______!

  33. r081984 says:

    Chase bank pulls the same crap.

    The manager of the bank swore to me that I could have a $0.00 balance for two months before I would start using the saving account.

    Two months later when it was time to for my student loans to be direct deposited I find the savings account was closed when I tried to login online to see if my money was there.

    I went to the local branch and they tell me that I had to have at least .01 in there every month or it would be closed. I told them what the manager told me and they called me a liar.

  34. bostonguy says:

    I’ve noticed, on my ING savings accounts, that if I transfer all money from one account to the other, it asks me if I want to close the account as well…

  35. StellaSquash says:

    my bank closed a second checking account I had. I frequently transferred funds and happened to transfer the entire balance, leaving it at zero. I believe the account was closed that day because it was closed by the time I tried to transfer funds back into it.

  36. Dyscord says:

    I usually take “No minimum balance” to mean that you can start it with any balance you’d like, instead of the $50 most banks want to charge.

  37. hardcle says:

    This is not uncommon. At the bank I work for, I have often had to process $.01 deposits late in the day so that we could keep an important customer’s account open.

  38. thedap says:

    Wow, about 99% of banks will close an account with a 0 balance. Sometimes I think people lack the ‘common sense’ gene and just don’t think at all when they sign up for stuff.

    I know I know it’s all Rap music’s fault.

  39. synergy says:

    I drained my account in March and thought oh crap! when I read then. I brought up HSBC expecting it to be closed and found… a penny! Apparently there was enough money in the account in passing that I made a penny in interest and my account is still open. rotflmao

  40. synergy says:

    @r081984: You’re not the only one. I had a zero balance in my Chase account for 10 days (I’d just gotten my first job and was poor as hell) and they closed it. A mere day before my monthly paycheck direct deposit. I was so pissed and the bank manager people acted like I was a raving lunatic when I went in there to rip people new ones. As soon as they re-opened it and all my money was where it should be, I transferred it to another account I’d opened elsewhere. I HATED Chase thereafter.

  41. Anonymous says:

    Although the wording may seem tricky at first, I understand what HSBC rep is trying to say. No minimum balance is not the same as zero balance. No minimum balance means there is no minimum amount required however, a balance would be considered any number greater than zero. No balance means you don’t have any balance ( zero dollars). So the confusion here is when people think that having a zero balance is considered a balance where HSBC considers zero balance no balance.