Some of us even despite the success of private-run banks have the belief that our money is safe in public-run banks though deposits at even private banks are secured up to the extent of Rs. 5 lakh. Now when it comes to savings account, you may be comfortable opting that too in a PSB and some of them fetch return better than big private banks. But there is also a case wherein in order to attract a higher customer base new age private banks and small finance banks are offering a higher return on savings account.
Now for the employed lot, while there may or may not be a choice to choose a bank's account as the employer rather maintains its employee's accounts in one particular bank, other people (self-employed) for that matter have a say and can choose to have a bank savings account on their own will.
Now, while may or may not pay heed this savings account is actually important and can be used as an avenue to build a sizeable contingency or emergency corpus for you over time and hence the interest rate factor is equally important for earning a good return here.
And herein if your comfort zone lies with public sector banks and you have a choice, some of the PSBs offer return on savings account at par with or even better than public sector banks:
PSBs that offer better interest rate than Private sector banks
IDBI Bank -3.1% (for balance up to Rs. 25 lakh)
3.6% (for balance over Rs. 25 lakh)
Punjab and Sind Bank - 3.1% for balance up to Rs. 20 lakhs
3.5% for balance above Rs. 20 lakh
Indian Overseas Bank 3.1%
Bank of India 3%
Union Bank 3%
Notably some of the reputed and leading private sector lenders are paying similar interest rate on savings account of between 3-3.5% per annum. So, if you have the choice you can consider savings bank account at these public run banks but here for higher safety you will have to forego higher return say for instance IDFC First Bank on savings account with over Rs. 1 lakh balance pay out 7% return per annum.
Also, another factor that is beneficial for the accountholder maintaining savings account with these banks is that there comes comparatively lower requirement (amount wise) when it comes to minimum average balance requirements.