What Is Savings Account: Types & Benefits Of Savings Account

Savings Account is the most frequently used account in India. The savings account definition says that it is a bank account that promotes saving your funds. If you are an individual planning to keep your future secure, a savings account is the perfect go-to.

The Savings Account provides you with interest on all your funds. Its other features, like limited withdrawals, regular deposits and provision of interest, make it the best alternative for a large population in India.

Different types of savings account

The savings bank account meaning has a vast explanation. Let us begin with the different types of savings accounts.

• Regular Savings Account
• Salary-based Savings Account
• Zero-balance Savings Account
• Women’s Savings Account
• Minor’s Savings Account
• Senior Citizen’s Savings Account

Here is a detailed note on savings account meaning and different types of savings accounts to help you get well-versed with them.

Regular Savings Account

A regular savings account is like a locker where you can save all your funds. It does not ask for frequent deposits and works on its basic terms and conditions. It assures the safety and security of your money.

Salary-based Savings Account

The salary-based savings account acts as a payment disbursement platform for companies. The banks open it at the company’s request. When salary distribution arrives, the bank withdraws the payment from the company’s account and transfers it to the employees. Salary-based accounts do not require a minimum balance. Also, if a salary is not credited continuously for three months, the account is converted to a regular account.

Zero-balance Savings Account

A zero-balance savings account has combined current and savings account features. There are limits on the withdrawal amount. However, it does not charge a penalty if your account falls below the minimum balance required.

Women’s Savings Account

What is a savings account for women?

Women’s savings account caters to banking and investment facilities for women. It comes with unique features and benefits for her. These include lower loan interest rates, waving off DEMAT account charges and special discounts.

Minor’s Savings Account

The main motive for curating a minor’s savings account is to educate the children about banking. If the minor is under 10, the account is operated by a guardian. After ten years of age, the child can manage the account. When the child turns 18, the account is converted to a regular savings account.

Senior Citizen’s Savings Account

The Senior citizen’s savings account is similar to the regular savings account. Yet, it offers many benefits and privileges to senior citizens. They get a higher rate of interest. The bank links the account to other old citizen savings schemes. It helps them get funds from their pension and retirement accounts in a single place.

How do saving accounts work?

A savings account works in a very systemized and organized way. FDIC (Federal Deposit Insurance Corporation) insures the deposits you make in the savings account. It provides only up to Rs 5,00,000 per depositor, insured bank, and ownership category. The savings account then offers you interest on your savings. The compound interest is deposited in your bank account, and you earn a new balance.

How to open a savings account?

After knowing about what is a savings bank account, the article now focuses on the process of opening a savings account. 

You can open a savings account through both online and offline modes.

To Open a Savings Account Online

• Visit the bank’s website
• Select the ‘open savings account’ option
• Keep your documents ready
• Complete the KYC 
• Fill in the required information
• Start making deposits after the process is complete

Jupiter offers a wholly digital and hassle-free account opening with no minimum balance requirement and hidden fees. It is the best platform to experience transparent and precise banking.

To Open a Savings Account Offline

• Visit the bank and request opening a savings account
• Take all the documents (original and copies)
• Submit the required information
• The officer will give you the final verification

Eligibility requirements for opening a savings account

Anyone within the nation is eligible to open a savings bank account. All people holding Indian citizenship and foreign nationals living in the country can have savings account for long-term or business purposes. Foreign residents residing in India have different provisions and documentation processes to open a savings account. It also requires linking PAN to your Aadhar Card and phone number.

Documents Required to open a savings account.

To open a savings account, you require the following documents –

• Any identity and age proof like voter card, passport, driving license or PAN card
• Two passport-sized photographs
• Address proof
• A senior citizen card in case of a senior citizen’s savings account
• Jupiter requires all the documents in digital form.

Features and Benefits of a savings account

A savings account has multiple benefits and features.

• It provides you with a space to stock and secures your funds.
• It also allows you to earn interest on your deposits.
• A savings account offers easy access to internet banking and mobile banking.
• The rate of interest ranges from 3.5% to 7% p.a
• Some banks offer insurance covers and minimum rental facilities to well-maintained savings accounts.
• It facilitates debit card withdrawals from any ATM all over India.

Federal Bank Savings account – Powered by Jupiter

This savings account has a variety of features-

● Jupiter offers the fastest service and opens an account in 3 minutes

● It supports paperless onboarding

● It is a Savings account with no hidden charges

● The Digi bank gives 1% rewards on Debit Card & UPI transactions.

● Its 24/7 in-app customer support makes it the most effortless and effective banking store.

● Jupiter also offers a Visa Signature Debit Card issued by Federal Bank

● It is a savings account powered by Federal Bank

Federal Bank Savings account – Powered by Jupiter does not require a minimum balance fee. It gives you real-time rewards and makes banking super easy.

Charges for opening and using savings account

Opening a savings account is completely free for all. However, other costs include minimum balance requirements and monthly or annual fees. The fee is withdrawn from the account. Hence, an overdraft fee is possible if the account balance is zero. 

Some banks waive off all these fees if you have an account in the bank. But, they charge if you close an existing account to open a savings account.

Cash Withdrawal limit in a savings account

The savings account also has a cash withdrawal limit. The limit depends upon the bank where you hold a savings account. Thus, you need to visit the official bank website to learn about your bank’s savings account limit. You can also connect to any officer from the bank in person or call to know the exact digits of the boundary. However, every bank has a flexible withdrawal limit in a savings account.

Why do you need a savings account?

What is a savings bank account if there is no need for it?

Savings Account holds great importance in the Indian banking system. It works like an E-locker that stores your funds and withdraw them anytime. It also offers a compound interest on all your savings. It also facilitates online transactions, cash withdrawals and much more. You can even make payments and pay bills through your savings account.

Conclusion

The savings bank account meaning shows that it works in the interest of all. It allows you to be future-ready by handling your funds safely and securely. It takes you far away from the standard banking features. A savings account gives you access to mobile banking, net banking and online transactions. It also enables you to earn profits on all your savings. Thus, having a savings account simplifies your life and serves as a one-stop solution to all your banking essentials.

Frequently Asked Questions (FAQs)

What are the different savings account services accessible through net banking?

It depends upon the bank. However, the essential savings account services you can access through net banking include payment transactions, shopping online, money transfers and requesting account statements.

How many basic savings accounts can I have in a bank?

You can have only one primary saving account in a bank.

Can I withdraw money from my savings account anywhere in India?

You can withdraw money from anywhere within and outside India. However, there may be charges depending on the norms of the ATM.

What are other savings account services accessible through phone banking?

Services like cheque status, balance enquiry and transaction details are accessible through phone banking.

What is a savings account?

A savings account is a virtual tomb that takes care of your funds.