Types of Bank Accounts in India , Get To Know Everything About It

Private banks, public sector banks or nationalized banks, foreign banks, and cooperative banks are the four types of banks in India. Citizens in India can open a bank account with any of these four types of banks.
To understand how to choose a bank account that meets your needs, you must first understand the many types of bank accounts available from each of the four types of banks.Bank Special Online Classes: Join Detailed Batch By Safalta here!

There are six different types of bank accounts from which to choose:

 

#Sallary account 
#NRI Account 
#Recurring Deposit (RD) Accounts
#Fixed Deposit (FD) Accounts 



 

Consumers are encouraged to save money by using these deposit accounts. A savings account may be started by anybody in India who has an Aadhaar card and a PAN card, both of which are required to open a bank account in India.

Limit. The amount of money that can be saved in a savings account is unlimited. Depending on your bank, the number of transactions may be limited in some situations.
Balance. In most circumstances, a customer is obliged to maintain a mandatory minimum amount in order to keep a savings account.
Minimum balance criteria are waived for some accounts, such as savings accounts created under the Pradhan Mantri Jan Dhan Yojana, the Indian federal government's financial inclusion programme (PMJDY).
Under PMJDY, each person is given one savings account with a zero balance. These accounts are classified as Basic Savings Bank Deposit Accounts, which limit the number and amount of deposits that may be made, as well as the number of withdrawals that can be made each month, including ATM withdrawals.
Interest. A customer gets interest on savings account deposits. This interest rate differs from one bank to the next. For example, at India's largest public sector bank, State Bank of India, the interest rate on savings bank deposits is 2.70% for account balances of up to INR 1 lakh. While HDFC Bank, India's largest private sector bank, offers 3% interest on savings bank deposits with balances less than INR 50 lakh.
Benefit. Savings accounts are the most convenient way to generate interest on idle funds in banks.

 

Current accounts are typically used for company transactions in which funds are routinely moved between bank accounts. These accounts are best suited for daily commercial transactions by companies and company owners.

Limit. There is no limit to the amount of money that may be deposited into a current account. Current accounts do not have a transaction limit either.
Balance. A current account has a larger minimum balance than a savings account.
Interest. Consumers do not receive interest on their current accounts.
Benefit. These accounts have an overdraft option, allowing customers to take more money from the account than is actually in the account.


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Banks create these accounts at the request of large firms and businesses that pay their staff through banks. Each employee is entitled to a salary account into which their employer deposits their monthly salary.

Limit:  There is no limit to the amount of money that may be deposited into a salary account. Each employee gets paid depending on their workers' disbursements. Employees can conduct independent transactions between one type of bank account and another.
Balance: A salary account has a zero balance, and employees can withdraw the whole amount credited to the account at any time.
Advantage: These accounts can be changed into savings accounts at any moment. Banks have the power to convert these accounts into savings accounts if they have been inactive for more than three months.

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Non-resident Indians who want to keep a financial bank account in India open one of these accounts. There are three types of NRI accounts available:

These accounts accept deposits in Indian rupees. The funds deposited are from earnings in India.

Limit: There is no limit to the amount of money that may be deposited into an NRO account.
Balance. Any level of balance may be maintained.
Interest. The principal and the interest generated on that principal are both taxed.
Benefit. The rate of conversion has no effect on these accounts. The NRO account allows an NRI to open a current account, a savings account, or a fixed deposit account.

These accounts accept deposits in Indian rupees. The money deposited, however, is not earned in India; rather, the money deposited is earned or saved in the nation where the non-resident Indian resides.

Balance: Any quantity of balance can be kept.
Interest: Neither the principal nor the interest generated on the principle are taxed.
Advantage: These accounts bear the impact of a projected change in conversion rate. Through the NRE account, an NRI can open a current account, a savings account, or a fixed deposit account.

These accounts store deposits in the currency authorised by the Reserve Bank of India, India's central bank. Any NRI or anyone of Indian descent who has an income can keep deposits in an accepted currency. If the revenue is produced in a currency other than those on the authorised list, an approved currency is selected for the conversion of the earnings or profits to be deposited. FCNR accounts are sometimes referred to as FCNR (B) accounts, where the (B) refers for banks.

The Essentials of an FCNR Limit

Limit: There is no limit to the amount of money that may be deposited into an FCNR account.
Balance: Any quantity of balance can be kept.
Interest: The principal as well as the interest earned on that principal are not taxed.
Benefit: These accounts are affected by a potential change in conversion rate. Through the FCNR account, an NRI can only open a fixed deposit account with a minimum maturity of one year.

Customers who want to earn interest on their money create these accounts as deposit accounts. These accounts, also known as RDs, are the simplest method to generate a bigger income than that granted by savings accounts.

These accounts are established in order to receive interest on deposits for a certain length of time till maturity. Fixed deposits are one of the most secure financial products for saving and earning interest on idle funds.

Limit: There is no maximum amount that may be deposited into a fixed deposit account. The greater the money allocation, the greater the interest paid at the conclusion of the account's term.
Balance: An FD account is used to invest a big sum.
Interest: The bank will pay interest on this deposit. This interest is paid at the end of the FD's term. When a customer breaks an FD in the midst of its term, they risk losing the interest and generally receive only the principle amount.
Benefit: FDs are low-risk, high-return investments. Because of the fixed duration benefit that a bank receives with FDs, most banks in India provide FD interest rates that are greater than savings account and RD interest rates. Banks may retain large funds for a set length of time, while customers can earn greater volatility-free returns, making the financial instrument a win-win for both banks and consumers.