Types of savings bank account

A savings bank account is your first step towards saving and investing. We learnt about it in the article 'Basics of savings bank account'. Let's now delve deeper into this type of account by studying its various types. 1) No frills/basic Savings This account is aimed at those who have limited cashflows. It allows you to bank with a zero balance. There is no stipulation on minimum or average balance. If the balance in a no-frills account exceeds Rs 50,000 or if the cumulative value of credit transactions exceeds Rs 1 lakh in any financial year, the account will no longer be treated as 'no frills'. 2) Salary account This account is offered by companies to their employees. Monthly salaries are credited directly to these accounts. The account comes with concessions on maintaining a minimum balance, number of withdrawals, additional cheque-book facility and other features, including a free ATM-cum-debit card, in most cases. 3) Sweep-in or multiplier account This account provides the liquidity of a savings account, coupled with high-interest earnings of a fixed deposit. This is achieved through a fixed-deposit account linked to a savings account. The balance in this account is never idle. A fixed deposit from the surplus funds in your savings bank account, subject to a minimum balance as stipulated by the bank, is created

This article was originally published on November 01, 2021, and last updated on July 14, 2022.