Tax India ›› Saving Schemes›› Bank Deposits ›› Saving Bank Account
Savings Bank Account
A Saving Bank account (SB account) is meant to promote the habit of saving among the people. It also facilitates safekeeping of money. In this scheme fund is allowed to be withdrawn whenever required, without any condition. Hence a savings account is a safe, convenient and affordable way to save your money. Bank deposits are fairly safe because banks are subject to control of the Reserve Bank of India with regard to several policy and operational parameters. Bank also pays you a minimal interest for keeping your money with them.
Features:
The minimum amount to open an account in a nationalized bank is Rs 100. If cheque books are also issued, the minimum balance of Rs 500 has to be maintained. However in some private or foreign bank the minimum balance is Rs 500 or more and can be up Rs. 10,000. One cheque book is issued to a customer at a time.
A Savings account can be opened either individually or jointly with another individual. In a joint account only the sign of one account holder is needed to write a cheque. But at the time of closing an account, the sign of the both the account holders are needed.
Return:
The interest rate of savings bank account in India varies between 2.5% and 4%. In Savings Bank account, bank follows the simple interest method. The rate of interest may change from time to time according to the rules of Reserve Bank of India. One can withdraw his/her money by submitting a cheque in the bank and details of the account, i.e the Money deposited, withdrawn along with the dates and the balance, is recorded in a passbook.
Advantages:
It's much safer to keep your money at a bank than to keep a large amount of cash in your home. Bank deposits are fairly safe because banks are subject to control of the Reserve Bank of India with regard to several policy and operational parameters. The federal Government insures your money. Saving Bank account does not have any fixed period for deposit. The depositor can take money from his account by writing a cheque to somebody else or submitting a cheque directly. Now most of the banks offer various facilities such as ATM card, credit card etc. Through debit/ATM card one can take money from any of the ATM centres of the particular bank which will be open 24 hours a day. Through credit card one can avail shopping facilities from any shop which accept the credit card. And many of the banks also give internet banking facility through with one do the transactions like withdrawals, deposits, statement of account etc.
How to open:
Savings Bank Account can be opened in the name of an individual or in joint names of the depositors by filling up the appropriate forms. A minor who have completed ten years of age can also open and operate the account. At the time of opening an account one must submit the documents like photocopy of passport or Electoral card, Postal identification cards as address proof and two passport size photos.
Most banks also require an introduction for opening an SB account. The introduction may be obtained either from an existing account holder or from a respectable citizen, well known to the bank, who should normally call on the bank and sign in the column specially provided for the purpose of introduction in the account opening form.
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