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​​All You Need to Know About a Savings Account in India

For many, a savings bank account is often the first port of contact with banks. This account acts as a medium to park your additional money in the form of an emergency fund after meeting all your monthly mandatory expenses. While this account holds a lot of importance in your financial portfolio, it is an instrument, which is least researched.

Checkout some of the crucial factors that can assist you to select the best savings bank account as per your requirements:

  • Rate of interest:Savings accounts offer the lowest savings interest rates than other investment instruments. While small savings banks and few private sector banks offer attractive interest rates of up to 7 % p.a., public sector banks usually offer the lowest rates on savings accounts that go up to 3.35 % p.a. Thus, ensure to always opt for a high yield savings account to earn higher returns and prepare an adequate emergency fund and meet your crucial short-term goals faster.
  • Minimum amount balance requirement:Generally, PSUs have low or nil MAB requirement while private players may demand a substantial MAB for accounts with higher features and benefits. Thus, it is recommended to move ahead with the account that does not propel you to lock in a considerable amount in the form of MAB. Choose an account that requires nil or minimal MAB and offers features and benefits as per your requirement.
  • Network or presence of the bank: Current generation is highly dependent on web-based apps, which has encouraged banking sectors to inculcate latest technology and develop mobile banking and net banking to make payments easy and convenient. Despite this, there are specific transactions that require you to physically visit the branch like cheque submission, avail demand draft, use lockers etc. This makes it necessary to open an account in a bank having a widespread network and branches.
  • Ancillary fees/service charges: Certain banks charge on availing ancillary services like SMS alerts, availing chequebooks after free quota is over for a financial year etc. Ensure to be completely aware of such charges when opening a savings account. Having said this, a transparent bank is much better than the one that seems less expensive, but has many hidden costs associated with its account.
  • Deals on credit cards:To differentiate from the competitors, many banks provide discounts and cash back offers on using their credit cards. However, certain banks may levy annual charges on their cards while few waive off this amount if annual transactions surpass a minimum threshold.
  • Doorstep banking feature: Owing to the present scenario of busy schedules, specific banks may offer doorstep services like cheque or cash pickup, document pickup and demand draft delivery. Certain banks may even deliver the demand draft to the requested receiver, but all such services often come with a cost, which you must factor in before opting for such high-end bank accounts.


Before opening a savings bank account, it is wise to factor in all the parameters, which can help you avail maximum benefits at lower cost. It can also help you to have a profitable, extensive, and transparent relationship with the bank.