Originally Posted by Kevsh

If you start a new campaign or add keywords you have no "history" for that keyword, so there is a minimum bid. However, if over time your Quality Score for that keyword/ad is very high it can drop lower than the minimum.

For example, you start a new campaign and target 10 keywords. You bid 0.10 for each. After a few weeks, for example, a few are getting very high click-throughs while others are poor. The poor ones you may still be at 0.10 but the ones with high CTR may drop to 0.04, etc.