A savings bank account is the most trusted investment method for most of the people nowadays.
The account holder can store extra cash in it, earn interest on the stored money, and access it wherever and whenever they want, even online. It is one of the most basic financial instruments used by every person throughout the world that is trusted by everyone.
The funds can be deposited easily through cheque or cash and money can also be transferred through methods such as NEFT, IMPS, RTGS, etc.
This article is going to cover all the following topics:
- Savings Account Types
- Key Features and Benefits of Savings Account
- Savings Account – Eligibility Criteria
- Savings Account – Documents Required
- Savings Account – Rate of Interest
- Paisabazaar is here to help find the best Savings Bank Account
- Apply online for Savings Account at Paisabazaar.com
- How to Open a Savings Account by visiting the bank?
- Top Banks Providing Savings Accounts
- Savings Account in Post Office
- How to make the correct savings bank account choice?
- Savings Account FAQs
Savings Account Types
- Zero Balance Savings Account: This type of savings bank account lets the bank users operate a bank account that works just like a regular savings account but there is no minimum balance or monthly average balance which they need to maintain at the end of the month. The only requirement for opening this account is that a person needs to complete the KYC either offline or online using eKYC.
- Salary Account: This kind of account is specially designed and introduced for salaried individuals. Some of the companies require employees to have a salary account so that it can credit the salary into it at the end of each month. One implication of this account is that the account holders needn’t maintain any minimum or average monthly balance to operate the account. The account will automatically convert to a regular savings bank account with minimum balance requirements if the monthly salary is not credited for around 2-3 months.
- Regular Savings Account: The regular savings bank account requires every account holder to maintain a certain amount of minimum balance at the end of each month depending on bank to bank. Not maintaining the minimum balance may incur additional charges or fines for the same. It provides basic rates and services for all the needs of a regular person.
Key Features and Benefits of Savings Account
- One of the best benefits or features of a saving account is that it helps in saving your valuable money at a single place for all the future needs or emergencies and promotes the habit of saving. The account also earns a certain interest depending on bank to bank and the amount of money maintained in the bank account along with the prevailing interest rate.
- The interest rate of a savings bank account can vary from 3.5% to 7% p.a.
- ATMs and network branches are very easy to access with the respective banks.
- The account number can be personalized.
- The deposit amount has no limits.
- The cheques can also be personalized for high security and safety.
- The RD deduction and EMIs can also be linked with the savings bank account.
- On a regular basis, several offers come upon the debit card of respective banks.
- Phone banking and internet banking facilities make it convenient to pay the bills and check the account balance on-the-go.
- With the use of UPI/NEFT/IMPS/RTGS, the funds can be transferred to any other bank account with just a few taps.
Savings Account – Eligibility Criteria
There are no employment or income criteria that are required to be eligible to open a regular savings bank account. Every bank has its own eligibility criteria for different kinds of saving accounts and it requires very basic eligibility. Some common requirements are as follows:
- The applicant has to be above the age of 18 years. But there are some banks that offer savings bank for minors as well which can be opened and operated with the consent of parent/guardian.
- The Indian Citizens, foreign individuals, and non-resident Indians can apply for a savings bank account.
Savings Account – Documents Required
In order to opt for the account opening through eKYC, two documents are required:
- Aadhaar Card
- PAN Card
If the applicant wants to apply for the savings account by visiting the branch, he/she needs to submit the following documents:
- Passport Size Photographs
- Address Proof
- Identity Card
- Signature Proof
- Aadhaar Card
Savings Account – Rate of Interest
In most of the cases, the rate of interest provided to the savings account holders may vary from 3.5-7%. DBS banks provide up to 7% of interest on its savings bank account, whereas, the Kotak Mahindra Bank provides 6% on its salary accounts.
Government banks such as SBI offer a low-interest rate i.e. just 3.5%. Most banks that provide higher interest rates usually have high minimum balance requirements as well. They can also change according to the guidelines provided by RBI from time to time. There are also banks like Kotak Mahindra Bank that also provides no minimum balance accounts with high-interest rates.
Paisabazaar is here to help find the best Savings Bank Account
The applicants can the best and suitable savings bank account for them as per the information provided by them. They can also check their eligibility for those accounts and all the necessary requirements. Paisabazaar also helps in planning for all the financial needs by guiding the customers for every need.
Apply online for Savings Account at Paisabazaar.com
Anyone can apply for the savings bank account with paisabazaar.com easily. The user needs to log into the website and answer just a few questions and get the best offers. He/she needs to answer the annual income range, place of residence, and some other personal details. After that click on the submit button and all the personalized savings account options will be displayed.
On the next page, the user can also compare the saving bank accounts on the basis of minimum balance requirement, interest rate, and benefits. After selecting the most suitable account, the user will be redirected to the bank’s website to apply for the account or will be provided with a reference number through which the bank will contact him/her in the next 48 hours.
The application will be sent directly to the bank so that it can be processed further.
How to Open a Savings Account by visiting the bank?
The first step is to research every bank and its savings accounts. Then compare the most suitable account for you. The websites of the respective banks and financial institutions will help you in viewing all the features and benefits the bank provides to its customers.
Then visit the bank’s branch nearest to you with all the required documents for the KYC process such as identity proof, address proof, age proof, and a few photographs.
Take the account opening form from the counter which is responsible for opening the savings accounts.
The form should be filled properly and with true information. Also, sign at all the required places and if you have any doubt then clear it at the counter but don’t fill anything wrong. Submit the form with all the documents asked.
The account will get functional within the time provided by the clerk at the counter after the processing is completed. Every bank has its own processing time.
Top Banks Providing Savings Accounts
Providing savings bank account facilities to the customers is the primary business of all banks in the country. All the banks that provide retail services also give the service of savings bank account to the customers. The top banks that provide the account opening facility are State Bank of India, Standard Chartered Bank, HDFC Bank, ICICI Bank, Axis Bank, IDFC First Bank, Kotak Mahindra Bank, Yes Bank, Citi Bank, and many others.
Savings Account in Post Office
The Indian Post Office also provides the facility to open a savings account with them. A person can visit the nearest post office for the same purpose.
The account opening charge is just Rs. 20 and the account holders have to maintain a minimum of Rs. 500 every month as the compulsory minimum balance requirement those who want cheque facility, otherwise, without cheque facility, the account holder just needs to maintain a minimum balance of Rs. 50.
The account can be transferred from one post office to the other throughout the country.
Minors above the age of 10 years can open the account with their parent/guardian stated as co-borrower.
The interest rate provided is 4% p.a.
Both individual and joint accounts can be opened.
How to make the correct savings bank account choice?
The factors provided below should be considered while making a choice for the savings bank account:
- Required Minimum Balance
- Debit Card Offers and Deals
- Interest Rate
- Additional facilities such as lockers, cheque-books, mobile banking, etc.
Savings Account FAQs
Q1. Is it mandatory to be above 18 years of age to be eligible for a savings bank account?
A1. Yes, it is mandatory to be above 18 years of age to be eligible, however, some banks provide service to minors with the consent of their parent/guardian to open a self-operated savings bank account.
Q2. Does every bank have the facility of the cheque-book?
A2. Yes, all the banks provide the cheque-book facility.
Q3. Is the account holder charged with additional charges for operating ATM to withdraw or deposit money into the account?
A3. Yes, the banks provide a number of free transactions with ATM and the account holder is charged for the additional transactions. The charges can vary from bank to bank.
Q4. Is tax levied on the savings bank account?
A4. The interest on the savings bank accounts up to Rs. 10,000 is tax-free under Section 80TTA. TDs may be levied on the higher amount of interest earned.
Q5. How to check the account balance?
A5. The account balance can be easily checked through internet banking or phone banking. Nowadays, the balance can be checked with ATMs as well. Most of the transactions can be handled online now so that you don’t need to visit the bank for purposes such as checking balance, transferring money, etc.
This article covers everything which a person should know before opening a savings account. It is one of the best and most trusted ways to save money for all your future needs and earn interest on the saved amount as well.