July 19, 2023 · 6 mins read
Types of Bank Accounts in India: Which One Is Right for You?
Shireesha Katta
When it comes to managing our finances, having a bank account is an essential part of modern life. It not only provides a secure place to store our money but also offers various features and benefits that can simplify our financial transactions. In India, there are several types of bank accounts available, each catering to different needs and requirements.
In this blog, we will explore the most common types of bank accounts in India and help you determine which one is right for you. These days there are many money-earning apps like the ZET app which allows you to earn money by selling bank accounts. So, let's get started!
The savings account is the most popular type of bank account in India. This account is designed for individuals to safely deposit their money while earning interest on the balance. It offers features like ATM/debit cards, online banking, and chequebook facilities.
With a savings account, you can withdraw money whenever you need it, make online transactions, and receive interest on your balance. If you are looking for a basic account for day-to-day banking needs, a savings account would be the ideal choice.
If you own a business or are involved in commercial activities, a current account is the perfect choice. Current accounts are designed mainly for businesses and corporations, offering features like unlimited transactions, overdraft facilities and chequebook issuance.
Unlike savings accounts, current accounts do not earn interest on the balance, but they provide more flexibility for frequent transactions and managing cash flow. So, if you're looking for a bank account that suits your business needs and keeps things running smoothly, a current account is the one you should consider.
FDs (Fixed Deposits) are a great option if you want to earn higher interest rates on your savings. In this type of account, you deposit a lump sum amount for a fixed period, ranging from a few months to several years. The longer the duration, the higher the interest rate you can expect.
FDs are pretty safe investments and give you guaranteed returns, so they're a good choice if you prefer stability and don't want to take too many risks with your money.
A recurring deposit account is a great choice if you want to save a fixed amount of money regularly for a certain period. It works on the principle of disciplined savings, where you deposit a predetermined sum each month.
RDs also offer a fixed interest rate that is generally higher than savings accounts. So, if you have a steady income and want to build up your savings over time, an RD is a perfect option for you.
If you're an Indian living abroad, you can open special accounts called NRI accounts to handle your finances in India. NRI accounts come in various types, such as NRE (Non-Residential External), NRO (Non-Residential Ordinary), and FCNR (Foreign Currency Non-Residential).
These accounts allow NRIs to hold and transact in Indian currency or foreign currency, depending on the type of account. If you are an NRI looking to maintain your Indian connections and make investments in India, these are beneficial for you.
Salary accounts are designed specifically for employees who receive their salaries through direct deposit from their employers. These accounts offer several advantages, such as zero balance requirements, free ATM withdrawals, and additional benefits like discounts on loans, credit cards, and insurance.
If you have a steady income through employment, a salary account can be a really smart choice to manage your monthly finances conveniently.
Choosing the right type of bank account is crucial for managing your finances effectively. Whether you're looking for a safe place to keep your money or a business owner seeking transactional flexibility, understanding the different types of bank accounts available in India will help you make an informed decision.
Consider your financial goals, income source, and transactional requirements when choosing a bank account. Remember, banks often offer a range of add-on services and benefits, so be sure to compare and choose the account that aligns with your needs.
Did you know that you can easily apply for some of the best bank accounts using the ZET app? It's pretty awesome because you get to enjoy a bunch of amazing benefits as well.
Don't you think this is a unique way to earn some extra cash? It's super convenient and hassle-free. Happy banking!
1. Are there any fees associated with bank accounts in India?
Yes, most bank accounts in India have certain fee associated with them, such as account maintenance charges, transaction fees, chequebook issuance charges, and charges for non-maintenance of minimum balance. The fee varies depending on the type of account and the bank.
2. How do I choose the right bank account for myself?
To choose the right bank account, consider factors such as your financial goals, transaction requirements, minimum balance requirements, interest rates, charges, and additional features provided by different types of accounts. Assess your needs and compare offerings from different banks before making a decision.
3. Can I hold multiple types of bank accounts simultaneously?
Yes, you can hold multiple types of bank accounts simultaneously in India. Many people maintain different accounts to meet specific financial goals or segregate personal and business finances. However, it is important to manage them responsibly and keep track of associated fees and minimum balance requirements.
4. Can I convert my existing account to a different type of bank account?
Depending on the bank's policies, you may be able to convert your existing account to a different type. Contact your bank to inquire about the conversion process and any associated fee or requirements. It's advisable to understand the features and benefits of the new account type before proceeding with the conversion.
