The simplest account you can start at any bank is a savings account.
By definition, a savings account enables you to deposit your money safely with the bank, allowing you to save, invest, and spend seamlessly.
A savings account is typically used for funds you don’t want to use immediately, as compared to a checking account.
There isn’t a limit on how many savings account you can have, and each account can come with average interest rates to help you accumulate wealth.
Each account holder has the opportunity to earn interest on their account balance at a rate that is both variable and predetermined.
There are no rules about when or how much you can take out of a savings account, but each withdrawal reduces the principal and any interest that has built up.
Before you dive into how and where to open a savings account, you need to know what factors can influence it.
You also need to know if a savings account fits your current and long-term needs.
Let’s take a look at these here –
When deciding where to open a savings account, there are several factors to consider.
You can choose that option based on your needs.
First, let’s have a look at the most fundamental considerations for starting a savings account:
- Interest Rate: When compared to other investment options, savings accounts often offer the lowest interest rates. The majority of banks still provide low returns on savings accounts, at around 4%, even after the RBI deregulated interest rates in 2011. Even while some private banks entice customers with 6% or greater enticing rates, it is always advisable to read the small print before selecting any bank.
- Required Minimal Funds: Normal minimum cash-balance requirements for accounts at public sector banks are zero or modest (between Rs. 500 and 1,000), but most private players would set a high minimum balance requirement (Rs. 5,000-10,000 or more). Choosing a bank that does not require you to lock in a sizable amount of money in your account is best.
- Service Costs: After the minimal free quota (25–50 cheque leaves) for each financial year, several financial institutions charge you for additional services, including SMS alerts, duplicate ATM cards/PIN numbers, and chequebooks. When you open a savings bank account, ensure you are well informed of these fees. Having said that, a bank that is more open to scrutiny is preferable to one that presents itself as affordable but may have hidden fees.
If you’re not already saving money, why not start?
- Double your savings – Potential profits are at the forefront of anyone’s mind when considering an investment. A savings account offers low risk and the possibility of a return. The returns may be lower, but at least your money is making money.
- Just save, don’t withdraw – A savings account allows you to earn interest on your money while it accumulates. In addition, your savings account’s interest rate will rise in proportion to the amount you’ve deposited and the number of years you’ve had it open.
- Easy access to your funds – Due to their accessibility, savings accounts can serve as a safety net in times of need. You won’t have to wait any longer to get your hands on the cash. It can be quite valuable because it can be received much more quickly than any other possibility. You have rapid access to your money when you need it if you maintain it in your savings account.
Procedures for opening savings account with a bank online
To open savings account online you require only access to the internet and identity proof of some identification
Step 1: Compare the interest rates and fees charged by different institutions. Find the best place to put your money—where it will yield the most interest.
Step 2: Decide which savings account option you wish to use after making some comparisons.
Step 3: Enter your personal details (name, address, email, phone, Aadhar card, PAN, account information, etc.) into the relevant fields.
Step 4: Once your application has been approved, you can save the funds in your account by depositing them.
How can Fi.Money assists you in establishing a savings account.
A digital savings account helps you save and spend in a matter of seconds.
But before opening a digital savings account, carefully examine the minimum deposit requirement.
Some platforms might charge you for having less balance. As a beginner, it’s ideal to try a zero-balance savings account, like Fi.Money.
The Fi.Money app helps you make a savings account in five minutes and grow your financial journey with a few taps and clicks.
To open a savings account with Fi.Money, just follow the specified steps.
Step 1: Download and sign up for the Fi Money app.
Step 2: Locate the savings account and record your personal information.
Step 3: Finish online KYC verification by giving information about yourself, like a PAN card.
Step 4: After that, you must complete face verification by spelling the four-digit number that appears on the screen.
Step 5: Once you’re approved, you’ll be able to use both a virtual debit card and a real one.
Banks provide a variety of accounts for customers to choose from based on their needs, frequency of transactions, and location. There are many types of bank accounts available in India.
Another popular choice in bank accounts is the current account.
The current account is a deposit account that traders, business owners, and entrepreneurs prefer as it hones multiple daily transactions.
There is no daily transaction cap on the more liquid deposits held in these accounts.
Current accounts allow overdrafts or taking out more money than is currently in the account too.
Here are some major differences between a current account and a savings account.
A current account vs. a savings account
- The minimum balance for a savings account is low, while the minimum balance for a current account is high.
- The interest rate on savings accounts varied between 4% and 6%. Current bank accounts often do not earn interest.
- You can’t make unlimited withdrawals from your savings account. In addition, current accounts provide for consistent financial dealings.
- A savings account is a place to put money aside for future use or use in an emergency. Businesses with a high volume of transactions are recommended to use a current account.
Conclusion
One of the best things about opening a digital savings account is that the account opening process doesn’t take weeks.
Fi.Money’s straightforward onboarding procedure is done in only five minutes.
Verifying your information could need a few hours to several days.
After which, you are ready to access your online savings account and get a swanky debit card too!
Related articles: