Nowadays, banks are trying to attract customers to open Savings Accounts because they are a source of low-cost funds. You need not deposit a huge sum as an initial deposit to open them, especially if you opt for online account opening. Whether you open a Regular, Zero Balance, Women’s, or Senior Citizen’s Account, check the following factors beforehand:
- Minimum balance requirement
Banks mandate their customers to maintain a minimum average balance when they open a Bank Account online, which may range between Rs. 1,000 to Rs. 25,000, depending on their requirements. The minimum average balance is calculated monthly or quarterly, depending on the bank. If it falls below a certain threshold, you need to pay a penalty of up to Rs. 1,000 per quarter. The interest rate earned on them is 3% to 6% per annum.
- Location and accessibility
Choose a bank with a branch at a convenient location. A centralised and well-connected location is preferable as you can access it even during an emergency. With the introduction of Internet Banking, you can easily track your finances and pay for necessary items and utility bills instantly without requiring physical currency.
- Charges
Avoid opening an account with banks that levy high fees for their services or as penalties. Some banks charge annual fees for using their Debit Cards, while others do not. Compare the charges for various other services, such as issuing bank drafts, stopping check payments, issuing duplicate passbooks, or certifying your signature for a third party.
Savings Accounts online usually include low or no fees for their services, making them preferable to conventional banking methods.
- Facilities offered
Banking is more than depositing cheques and withdrawing cash. You will eventually need other services, such as lockers for storing valuables, a Demat Account, and investment services. Banks also provide you with the facility to buy Gold and Mutual Funds with the guidance of Insurance advisors.
The Banking app lets you check all the services the bank offers and their charges and apply for new Debit and Credit Cards. You can track their status, pay bills, and note all transactions. Moreover, you can also opt for EMI payments from your Debit and Credit Cards for Loans.
- Interest rates offered
Choose a bank that gives you the biggest bang for your buck. You can get high bank Savings Account interest rates. Rather than paying 3% to 4% interest, these accounts offer up to 7% interest per annum if your account balance is above Rs. 4 lakh and up to Rs. 5 lakh.
Conclusion
If you shop around, you can get a higher interest rate on your account balance. Since interest earnings up to Rs. 10,000 are tax-free, it can be a good long-term investment. By becoming financially literate, you can increase disposable income.
