A savings account is a highly favoured financial tool known for its safety and flexibility. Apart from its primary role of safeguarding your funds, a savings account has evolved significantly and now offers numerous other features and benefits.
By understanding these features of a savings account, you can get the best out of your account. Whether you want to set up automatic debit for your recurring payments or withdraw funds from an ATM, a savings account offers it all.
Read on to learn the advantages of a savings account and more.
Here are the top benefits of a savings account that you must know about.
A significant benefit of a savings account is that it provides adequate safety of your funds. You can keep your money in this account without worrying about theft or damage. This is because the Reserve Bank of India (RBI) has a set of rules and regulations that the banks need to follow.
The Deposit Insurance and Credit Guarantee Corporation (DICGC) also insures each account for up to ₹5 Lakhs.
Another attractive feature of a savings account is that it allows you to easily transfer to other accounts. You can use various methods to transfer funds, including NEFT, IMPS, Net Banking, and RTGS, among others.
Nowadays, you can also link your savings account to UPI platforms. You can use these methods to transfer funds to other bank accounts or make payments for several expenses in real-time.
Another notable feature of depositing your funds in a savings account is that you get interest. Banks offer competitive interest rates on savings account deposits to attract new customers.
This allows you to explore various banks and choose a bank that offers the best interest rates. The interest on your savings account deposits helps you gradually increase your overall savings. Note that these rates are nominal, ranging between 3% and 7.25%.
A notable feature banks have recently introduced is the automatic debit facility for your payments. This payment facility allows banks to make payments from your savings account.
You can use this facility for recurring monthly expenses like paying EMIs for your loans, paying premiums for your insurance policy, or handling utility bills. This lowers the chances of missed or delayed payments and protects you from late payment charges and other consequences.
Another key benefit of opening a savings account is that it helps manage your finances better. Having cash on you at all times isn’t safe and makes it very hard to track. As such, you can easily overspend or even lose money and not realise it until it is too late.
However, banks allow you to check your savings account balance and payments through mobile apps or SMS. Also, you can open separate accounts for savings and expenses to manage your money efficiently.
For enhanced flexibility, you can open a joint savings account with your spouse or other family members. This allows all the account owners to deposit money, make transactions or sign cheques from the same account.
It is especially beneficial when managing the income and expenses of a household. For instance, you and your spouse can open a joint account and handle household expenses easily through one account.
As evident, a savings account is a valuable financial tool offering numerous benefits that can help you manage funds efficiently. You can explore a wide range of options for a savings account on Bajaj Markets. You can easily apply online with a simple digital application process, easy-to-meet eligibility criteria and documentation.
You must be an Indian citizen or an NRI above the age of 18 years to open a savings account. You must also comply with the KYC guidelines set by the Reserve Bank of India (RBI). Nowadays, some banks allow minors to open a savings account as well.
To open a savings account, you need to provide your latest passport size photographs and some identity and residential proof documents. These include your PAN card, Aadhaar Card, Passport, Driving licence, etc. You might also need to submit additional documents as per the bank's requirements.
Different banks have different requirements for minimum balances in a savings account. Before opening a savings account, the bank informs you about the minimum balance requirement and other information.
Yes, many leading banks offer you the convenience of opening a savings account online. You can visit their website and start the process.