How to select most suited Saving Banks Account?

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How to select most suited Saving Banks Account?
Saving account (SB) has been the sole bond that joins a common individual with a bank. It has forgone several changes from the past when people had the option of few banks that too with one kind of saving bank account in an offer. Now people have a diversity to pick out the type of the most appropriate savings account fitting to its requisite. The variability in the modern-day savings account structure has fascinated a huge number of customers and also enabled banks to accomplish its financial inclusion obligation.

Basic Requirements to open a Savings Account

By an individual in his / her name;
- By more than one person in their joint names payable to :
o Both or all of them or the survivor or survivors of them; OR
o Either or any more of them or the survivor or the survivors of them; OR
o Former / latter or survivor of a particular person during his lifetime or survivors jointly or survivor.
- Some non-profit welfare organizations are also allowed to open Savings bank accounts with banks.

Saving Account types, facilities and charges

At present, every bank has several saving bank accounts to attract clients with diverse requirement profile. The banks have designed its products on the basis of customer's demographic segmentation, i.e. age, income and gender. The most common type of saving accounts available with banks is:

1 Senior Citizen Savings Bank Accounts
2 Women Saving Accounts.
3 Normal Saving Accounts
4 No-Frill Saving Accounts
5 Student Savings Account

With many products in offering and surge in the service grade, the bank's operating cost has also intensified manifold. To get back the cost, banks charge service fees on its complete product by its predefined method. Now a saving bank' account needs maintaining specified balance as per bank's criterions. This type of balance requirement is called average-quarterly-balance (AQB) or minimum-monthly-balance (MMB) etc. Banks also offers anytime liquidity through debit/ATM cards, online banking, At Par Cheques, Mobile banking, phone banking, bill payment facility, DEMAT services, investment in Mutual funds, insurance, etc., and charges for such services according to its norms.

How to opt the Saving Bank Account

With so many varied products offered by the banks, it becomes very hard for the client to choose the most appropriate savings account. Following is some significant points to think about while selecting a saving banks account:

1 ATM/Debit Card Charges: Debit cards are now the requirement of every account holder, so before opting an account, the related charges with debit cards should also be noted. Some-times the cards' issuance and yearly charges are zero but there are transaction restrictions so one should select according to frequency of card's transaction.
2 On-line Banking: Online banking assists in ticket booking, bill payments and nearly all of the banking operations by click of mouse buttons. The customer should select a saving bank account that allows them to handle all the major financial operations such as investment, bill payment, bank enquiries, etc. without any technical glitch and free of cost.
3 Monthly Balance Requirement: It is very troublesome to maintain the minimum balance condition as per bank's norms and if the customer doesn't adhere to such a stipulation, then they are liable to pay a penalty. Zero balance saving accounts should be favoured over others.
4 Cheque book facility: It is the essential facility that everyone requires. If the outstation transaction is more than a saving account with more number of free ATPAR cheques/quarter should be preferred.
5 Auto-Sweep facility: It helps the account holders to secure more interest on the bank balance by shifting an amount over the predefined level to the fixed deposit account. The FD interest is paid on the basis of number of days for which amount is put aside in FD.
6> Additional facilities: There are some other facilities especially personalized for its customer needs, like the cheque collection at door, third party cash deposit, accidental insurance and add-on card for shopping, etc. Such offers should be decided as per one's own need and application.

Savings Account well set to grow more

The popularity of saving banks account has gained rapidly in last few years because of RBI's initiatives, and financial institutions intensified insight of rural areas. Saving accounts are adequately arranged to rise further with better financial inclusion initiatives estimated to be taken by the banks in coming years. It has now become a requirement for all i.e. a poor or rich, man or women, young or elderly; everybody requires saving banks account for a simple task like school fees to pension cheque clearance. Saving accounts is proving to be a most productive tool that can reach and connect the life of 1.2 billion Indians and broaden growth through beneficial financial inclusion in their lives.

Read more about: banks, interest rates
Story first published: Saturday, August 25, 2012, 10:06 [IST]
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