What is a savings account?
A savings account is a sort of account that lets you deposit money and withdraw it whenever you need it, all while collecting interest on the money you put in. The features of a savings account can be further explained as follows:
- Accounts have no limits on how much money can be deposited or withdrawn; nevertheless, it is required to keep a minimum balance in the account; otherwise, a penalty will be incurred by subtracting a set amount from the account.
- A account can be operated for as long as the account holder desires, implying that there is no time limit on how long the account can be managed.
- On the amount deposited, banks pay the account owner a fixed savings account interest rate.
- With a savings account, you won’t be able to get an overdraft.
- For frequent transactions, whether online, offline or at ATMs, savings account customers receive debit cards and online banking services.
- On a daily/monthly basis, the number of transactions allowed in a savings account is limited.
- Any Indian resident can open a savings account; however, in the case of children and minors, the account must be opened and maintained by their parents or guardians.
- A savings account encourages people to save money.
Because savings accounts are one of the finest methods to save money without having to carry cash, you may choose from a variety of savings account options to match your needs. The following is a list of savings accounts offered by a variety of banks, which may vary from one to the next:
- Regular account
- Salary account
- Zero balance account
- Children and minor account
- Family account
- Women’s account
- Senior citizen account
Each savings account type has its own set of features, advantages, and eligibility requirements. A Senior Citizen Savings Account, for example, varies from a Children and Minor Account in that the former is for seniors only, whereas the latter is for children under the age of 18. A salary account, on the other hand, is only available to salaried professionals, whereas ordinary savings accounts are open to everyone. As a result, decide which bank and savings account type will best match your demands before choosing one.
What is a current account?
A current account is a type of deposit account that banks offer to individuals or institutions who plan to conduct a high volume of financial activities on a daily basis. This type of account allows for simple, everyday transactions but has the disadvantage of not being able to earn interest. The following features can help you better understand a current account:
- While individuals can utilize current accounts for day-to-day activities, businesses, trusts, associations, and private/public entities often use them for regular transactions.
- Although this sort of account doesn’t really pay interest on deposits, some banks have recently started to do so.
- With a current account, you can get an overdraft.
- The minimum balance requirement for these accounts is greater. If it is not kept up to date, a penalty is enforced, with money deducted from the user’s bank account.
- Current accounts are of a continual nature, which means they do not have a set period of time during which they must be used.
- Opening a current account necessitates the submission of KYC papers.
- The amount that can be deposited or withdrawn has no restriction; nevertheless, the account holder must have enough funds in his or her account to accomplish the operations.
- Current accounts are further classified into different versions, allowing enterprises, organizations, trusts, and others to choose the one that best suits their needs. The following are some of them:
- Premium current account
- Standard current account
- Packaged current account
- Foreign current account
Because banks provide a variety of current accounts, you must first choose which bank you want to start your account with. After that, carefully consider all of the current account options in terms of advantages, features, and services before making a decision.