Answer to your queries about Banking Services

Q1. What is a Current Account?

Ans. Current account is a bank deposit that can be withdrawn by the depositor at any time. The depositor is at liberty to operate this account any number of times in a day unlike savings accounts where only limited transactions are allowed. This account is opened by people who are engaged in trades, businesses and professions.

Q2. Who are the biggest beneficiaries of current accounts?

Ans. Current Accounts are designed for business needs and are primarily meant for businessmen, firms, companies, public enterprises, etc. The only purpose is to facilitate monetary transactions at every level of business.

Q3. Do current accounts bear interest?

Ans. No, Current accounts are non-interest bearing accounts.

Q4. Who are eligible to open a current account?

Ans. The current account can be opened by:
• All resident Indians who are 18 or above in age
• Individuals/Sole Proprietorships/Partnerships/Associations/Private and public companies/Societies/Trusts/HUFs, etc.

Q5. Can I open a joint current account?

Ans. Yes, current account can be opened either singly or jointly.

Q6. What is the minimum deposit required for opening a current account?

Ans. Banks require minimum deposit of Rs.5,000 to Rs.50,000 for opening a current account. Generally, nationalised banks require less Minimum Deposit.

Q7. How can I open a Current Account? What Documents are required?

Ans. Opening a current account is quite simple. Fill the application form and support it with relevant documents like proof of identity and residence. Additional required documents may differ from case to case. For example, the documents in case of sole proprietorship business will differ from those required in case of a private limited company.

Q1. What is a savings account?

Ans. Savings account allows you to keep money under safe custody. It also promotes savings habit among account holders. You can open these accounts with banks and post offices and earn interest on the money deposited.

Q2. Who are eligible to open savings account?

Ans. All Indian residents, Hindu undivided families (HUFs), Trusts, Associations, Societies and clubs are eligible to get a savings account open. Even minors can open savings account but only with their guardian.

Q3. Is there any requirement of minimum deposit to open savings account?

Ans. Yes. Various banks and post offices require a minimum deposit of Rs.500 to Rs.5,000. Mostly, the nationalized banks require lower minimum deposits.

Q4. How can I open a savings account?

Ans. You can apply online or call the customer care centre of the bank where you want to open an account. You can also personally visit the bank and submit your application with required documents.

Q5. What interest rate will I earn on my savings account?

Ans. The interest rates on savings account vary from bank to bank, ranging between 3 to 4 percent per annum.

Q6. How the interest amount is paid?

Ans. The interest earned on your savings account balance is credited to your account on a half-yearly basis – in September and March.

Q7. Who are eligible as co-applicants?

Ans. Anyone who is above 18 years of age can be a co-applicant for opening savings account.

Q8. How can I operate my savings account?

Ans. You can withdraw money through cheques, ATM cards, etc. Some banks provide option for Internet banking that allows you to transfer funds online. Besides, there is a facility for phone banking also.

Q9. Can I earn higher deposits on my savings account?

Ans. Savings accounts have low interest rates when compared to fixed accounts. If you want that to earn higher interest rate, you can issue standing instructions to your banker to transfer any amount above a fixed level to:
• Fixed Deposit account, or
• Recurring Deposit account.

Q10. Do senior citizens get some extra benefit?

Ans. Yes, banks offer higher interest rates to the senior citizens but only in case of fixed deposit accounts.

Q1. What is a fixed account?

Ans. Fixed accounts are fixed in terms of maturity period, rate of interest payable and the amount of deposit. However, with increasing competition in the banking sector, fixed deposit accounts are also offering a lot of flexibility to give you extra benefits.

Q2. Who can apply for fixed accounts?

Ans. Following persons or artificial persons can apply for a Fixed Deposit Account:
•  Resident Individuals
•  Sole Proprietorship Firms
•  Private and Public Limited Companies
•  Hindu Undivided Families
•  Trusts
•  Societies, Clubs and Associations
•  Foreign nationals residing in India

Q3. What is the minimum and maximum term of deposit in fixed accounts?

Ans. You can deposit money in fixed accounts for a period of 7 days to 10 years. Most banks require that money should be deposited in multiples of thousands.

Q4. Is loan facility available against fixed accounts?

Ans. Yes, banks provide loan/overdraft facility against your fixed deposit accounts.

Q5. What happens if I need money back before maturity?

Ans. You can get the money back but a penalty is levied in that case. The penal rate of interest is prescribed by the Bank on the date of deposit itself.

Q6. Is some Tax Deductible at Source on fixed accounts?

Ans. Yes. If the interest paid on fixed deposit accounts exceed Rs.5000/- per customer, per year, per branch then a tax is deducted at source.

Q7. What is the minimum deposit required for opening a Fixed Account?

Ans. The minimum amount required differs from bank to bank. Some banks require minimum of Rs.10,000 beyond which you can deposit in multiples of thousands.

Q8. Do banks issue fixed deposit receipts?

Ans. Yes. Banks issue a receipt for fixed deposit accounts with all the details like maturity date, amount payable at maturity, the rate of interest, etc.

Q9. Are any special benefits extended to senior citizens for opening fixed accounts?

Ans. Yes. Senior citizens get extra benefits in the form of higher interest rates.