Savings bank accounts are the most basic financial product that are available these days. They are the primary business of banks; therefore, all public and private sector banks with retail operations offer savings bank accounts to individuals. In the past two years, the number of new savings accounts in India has increased substantially with the introduction of the government sponsored Jan Dhan Scheme. Consider this, within one year of its inception, 17.74 crore Jan Dhan accounts were opened.
In the following sections, we will discuss some of the key types of accounts that are available.
Regular/Basic Savings Account: A basic savings account offers only some key facilities and fees. There is however no limit on the amount of money you can deposit over a period of time. In most cases, this type of account features a minimum average daily balance requirement and failure to meet this can result in penalty. To simplify access, you can choose to have cheques and debit cards linked to this account for an annual fee.
Salary Account: A salary account is a special type of savings account which can only be opened by a salaried individual. A majority of employers deposit the employee’s monthly salary and bonuses directly into this account. This type of account, however, has a few additional benefits such as the “zero balance” feature, a free cheque book/draft every month or quarter and a higher interest rate on deposit amounts. These accounts change to basic savings accounts if the account holder’s salary is not credited for 2-3 months consecutively.
Savings Account for Seniors: Only individuals over 60 years of age are eligible for this type of account and they can avail some key benefits that are not available in case of regular accounts. These benefits may include a higher interest rate, a waiver of minimum balance requirements and special offers on term deposits. Some leading banks providing seniors’ saving accounts include Yes Bank, Kotak Mahindra Bank, IndusInd Bank, Axis Bank, HDFC Bank, ICICI Bank and State Bank of India.
Joint Account: A savings account that is controlled by more than one account holder is termed as a joint account. In this type of an account, either of the account holders can withdraw the money deposited and debit cards with the name of each account holder can be separately issued. Traditionally, joint accounts had two holders, usually husband and wife however, the concept has now been extended to other family members. Some banks allow up to four joint holders in case of such accounts. All banks that offer savings accounts also offer joint accounts in India.
Women’s Savings Account: As the name suggests, only women are eligible for this type of savings account. Some of the key benefits available in this account include special discounts on other bank products, complimentary personal insurance coverage, higher rates of interest on the account and much more.
Minor Account: This refers to a special type of joint savings account in which one of the joint account holders is less than 18 years old. In case of such an account, one of the joint account holders must be the parent or guardian of the minor. Banks providing this type of account in India include ICICI Bank, Axis Bank, Yes Bank, State Bank of India and HDFC Bank.
Pradhan Mantri Jan Dhan Yojana Savings Account: Savings accounts promoted under this scheme are available in various leading banks including Yes Bank, Kotak Mahindra Bank, Axis Bank, State Bank of India, Bank of Baroda and many others. Accounts opened under this scheme are linked to a Rupay Debit Card and a maximum of 4 withdrawals a month are allowed on this type of account. There is no minimum balance requirement or annual fees for this account. Additionally, an insurance cover of Rs.30,000 as well as a Rs. 1 lakhs accidental cover provided to the account holder at no charge.