A savings account is a type of account that is opened at a bank or other financial institution that earns a moderate interest on the balance maintained. A savings account is essentially opened to put aside money that is not required immediately. Banks place restrictions on the number of withdrawals that can be made from the account each month. The interest rates earned on a savings account are determined based on the minimum average balance maintained in the account. The rate of interest offered on the balance in a savings account varies from bank to bank.
Savings accounts, as the name suggests, is a great way to save funds for the future. Excess funds can be kept aside and used when necessary. Here are a few reasons why opening a savings bank account is a good option:
Modern savings accounts are feature packed and offer quick links to pay bills, make quick transactions, etc. to the account holder as soon as he / she logs in to the account.
While most bank related work happens online these days, some trips to the bank are absolutely unavoidable. In case you’re stuck without a portal through which to create a bank account online, you can follow these steps to open a savings bank account offline:
The simplest way to conduct banking operations is online, and opening a savings bank account is a very simple procedure:
The following are the eligibility criteria for opening a savings bank account:
When customers decide to open a savings account, the bank requires the customer to submit certain documents. They are as follows:
Here are some of the features and benefits of a savings bank account:
Banks offer customers a variety of savings accounts that differ in terms of its balance requirements and features. The following are some of the types of savings accounts offered by most banks:
These are opened on the bank’s most basic terms and conditions. These accounts don’t see regular deposits of consistent amounts, nor do they see regular withdrawals. These are primarily the virtual equivalent of a safe where the money just sits waiting to be used by the account holder. These facilitate the most common form of virtual savings that aren’t touched, unless absolutely necessary.
These most often opened by banks on the request of large companies that require a payment disbursal solution. Banks offer companies preferential rates and specific terms for these accounts – which will be individually handled by each of the latter’s employees. At the date of payment disbursal, the bank withdraws from the company account and disburses the required amount among the salary based savings accounts opened for the employees. It should be noted that most salary accounts do not have a minimum balance requirement, but once the salary stops being credited (for whatever reason) for 3 consecutive months, these accounts are changed into regular savings accounts with a minimum balance requirement.
These accounts are created for senior citizens, with specific functionality and benefits for those in the senior citizen category. These function in the same way that regular savings accounts do, but generally offer higher rates of interest and exclusive banking privileges. They can be linked to other senior citizen savings schemes to remit the funds from retirement accounts or pension funds, and consolidate all the funds under one single bank account.
These accounts don’t generally have a minimum balance requirement and function in the same way as regular savings accounts. These are designed to educate the younger generation about modern day banking facilities and the general nuances of managing a bank account. These accounts are opened for minors by their parents or legal guardians. These accounts are operated under the supervision of the legal guardian until the child is 10 years old. Once the minor has crossed the age of 10, they are permitted to operate their account independently. After the account holder is 18 years old, the account is converted to a regular savings account and has a minimum balance requirement.
This type of account merges the best features of a savings account and a current account. While there are still limits on withdrawal amounts, these accounts are not charged any penalties if the balance in the account falls below the prescribed minimum. Sometimes, in cases where employees shift jobs and have to create new salary accounts – their old salary account will transform into a regular savings account – and when the balance inevitably falls below the minimum, they are charged a penalty or maintenance fee. This does not happen with zero balance savings accounts. Usually, banks offer these accounts to applicants from lower economic backgrounds, but have started offering salary accounts as zero balance accounts due to their utility.
A number of banks have begun offering savings accounts that have been specifically designed for women. These accounts come with special features to benefit the account holder. These benefits include discounts on certain purchases, low interest rates on loans, and a waiver on demat account charges.
When opening a savings account, one of the most difficult decisions to make is choosing the right bank. The following are a list of some of the banks that offer attractive features on a savings account:
ICICI Bank savings accounts may not offer the highest interest rate, but are almost unparalleled in terms of ease of use. The intuitive mobile app and online banking facilities with direct bill pay, etc. are excellent tools that can save time.
HDFC Bank is one of the country's largest private sector banks. It has a number of variants of the savings account for its customers to choose from. Additionally, HDFC has among the largest ATM networks in cities, which makes it the ideal account for a certain type of account holder.
Kotak Mahindra Bank has a number of savings accounts that it offers its customers. The newest variation of the savings account is the 811 account that has been gaining a lot of popularity. The account is a zero balance account and just takes a few minutes to open. Customers can upload the KYC documents to the bank website and the account is instantly activated.
Axis Bank has a wide range of savings accounts that customers can choose from. All these savings accounts come with either a Visa or RuPay debit card, whose use earns the account holders a number of perks.
Canara Bank is one of the country’s oldest and most trusted nationalised banks. While the bank still adheres to some traditional banking practices, it has also adapted to the technological advances in the industry. Additionally, the minimum balance requirement for the savings account is comparatively lower than other banks.
Punjab National Bank has a wide range of savings accounts that have been designed keeping in mind the financial requirements of the prospective customer. The accounts offered range from retirement accounts to accounts for armed forces and student accounts.
IndusInd customers have 13 variants of the savings account that they can choose from. Each type of account has exclusive benefits that can be availed by the account holder.