What is a Savings Account?

Savings Accounts are typically offered by banks that provide a safe and secure way to save money. The account holder can access their funds at any time and earn interest on their savings. The main goal of a savings account is to encourage individuals to save money for future requirements or unexpected circumstances. To promote saving habits, savings accounts often offer competitive interest rates and have monthly limitations on withdrawals.

Features of a Savings Account:

• Interest Earning: Savings Accounts typically offer interest on the deposited amount, although the rates can vary.
• Minimum Balance Requirement: Many savings accounts require customers to maintain a minimum balance to avoid fees or penalties.
• Limited Withdrawals: There are usually restrictions on the number of withdrawals or transactions allowed per month, without incurring additional charges.
• ATM/Debit Card: Most savings accounts come with an ATM or debit card for easy access to funds and retail transactions.
• Online Banking: Access to online banking facilities allows customers to manage their accounts, transfer funds, and pay bills conveniently.
• Passbook or Statements: Banks provide passbooks or monthly statements to track transactions and account balances.

A savings account and a current account are two common types of bank accounts offered to individuals crucial for personal and business transactions. A savings account is designed to save money over time. It typically offers a modest interest rate on the deposited amount. However, a current account is primarily used for business transactions and frequent withdrawals. It usually does not offer any interest on the deposited amount.