How To Open a Bank Savings Account and Why You Should?
A bank savings account carries our personal or business transactions. When we have a bank account, storing money is easy and you will earn interest on the deposit. From saving small deposit amounts to receiving government subsidies, bank accounts are a must. This article is about why an individual should open a savings account and how to do so.
Reasons to Open a Savings Account
Every individual has reasons to pursue and open savings bank account online, such as – receiving salaries, fund transfers and insurance payments. Apart from this, here are a few more:
Hold emergency funds
A savings account enables the account holder to receive payments and earn interest on them. The funds can accumulate over time with recurring payments. Through a savings account, creating a corpus of funds for financial or medical emergencies is easy.
Save for big events
Events are a part of our culture and occasions like marriage pass smoothly with sufficient funds. Savings accounts help you save a corpus as you earn a decent interest amount for the deposited fund.
Instant digital banking services
With a savings account, receiving funds from friends and family is a matter of seconds. Transferring money from one account to another can be done via mobile phone applications and net banking services. So make subscription payments, SIPs and bill and utility payments with just a few clicks.
Financial history
The savings account records all small-large amounts transactions. And a financial history is required to estimate the stability when you apply for a loan. Plus, when the loan is approved, use the saving account to pay instalments. This way, you have an on-time record of loan EMIs which will help you gather a
How to Open a Savings Account?
There are two ways to open a bank account. One of them is online and the other one is visiting the bank branch. Below are the steps to follow for opening a savings account:
- Compare and choose the bank
Everyone has different needs and expectations from their bank. Some need more branches, while some need more ATM locations. Comparing these services is necessary to select the right banking partner.
To open a savings bank account online, visit the official website of the bank. You’ll find information like interest on savings bank accounts, interest on fixed deposits and interest on loans offered by the bank on their website.
- The interest rate on deposits
Almost all banks offer the same level of interest rates with few differences in basis points and percentages. Choosing a bank based on interest rate might not have much impact on small savings accounts, but HNIs (High Networth Individuals) and businessmen can make good returns through their fund corpus over time.
- Online/offline application
After choosing the desired banking institution, opt for an online or offline application process. The online process is instantly completed with soft copy document submission, while the offline application takes the traditional time and effort with physical copies of all the required documents.
- Documents submission
The documents required for a bank account application are the applicant’s signature, ID proof and address proof. Once these documents are submitted, the applicant reaches the final step of the account opening process.
- KYC verification
KYC (Know Your Customer) verification is the mandatory step pushed by the RBI for all banking and financial institutions. This step involves linking the bank account and the contact number with the national identity proofs of India. It helps in transparency and decreases fraudulent activities.
Once the steps above are complete with the successful submission and verification of the documents, the bank account is opened in your name.
Also Read: Salary Account in Bank: Benefits, Features, and Working of Salary Accounts
Banking facilities like the ATM card, bank statement, chequebook and PIN-password details are delivered through post, and other bank details like the unique bank account number and IFSC code are sent to the registered email/phone number of the applicant.
