Opening a Bank Account is a fundamental step to getting started with your banking journey. It opens up a range of features to access funds and use them wisely. Moreover, digitisation enables you to access your funds through Digital Banking. Given the normalcy of a Savings Account, little thought goes into its activation. Most accountholders treat it as a regular banking product.
While it comes with simple characteristics, it also adds value to your finance management. Closer scrutiny of its facilities exposes its potential to achieve short-term goals. Hence, instead of treating it as a means to use your funds, you should understand its benefits. This way, you get to manage your savings better through Online Banking. Consider these lesser-known facts to get clarity on its usage:
Competitive interest rate
The fundamental purpose of online Savings Account opening should include saving and banking. Banks offer varied services for the same. Since they aim to give you the best banking experience, the interest rate gets less attention. As a result, a Regular Bank Account attracts nominal interest, unlike Term Deposits. However, most banks use their discretion to offer competitive rates. You should compare the same to get higher returns.
Promotional offers
Banks understand the demand for quality banking services. They also know that the features are almost similar across institutions. Hence, they use promotional offers to lure customers. This includes lower balance requirements, minimal transaction limit, value-added services, etc. You also get discounts on Debit/Credit Card usage. These offers get listed on their websites. Checking the same before you open a Bank Account lets you enhance your banking experience.
Taxability
As you park your income in the Bank Account, it is subject to taxation under the Income Tax Act. The tax deduction applies to the Savings Account interest rates. Earnings generated below Rs. 10,000 are tax-free. Anything beyond is taxable under section 80TTA. This limitation extends to Rs. 50,000 for senior citizens under section 80TTB. It is to protect their interests because of their low earning potential.
Effective payment systems
Fund management also includes making regular payments like transfers, clearing bills, shopping, etc. Some of these financial responsibilities include a deadline. You want to handle them before the due date to avoid defaulting. Banks offer automated and quick payment methods for the same. You get to access them through Banking apps.
Insurance
Safety is given utmost importance in banks. They value your money and take advanced security measures for its protection. One such effort is to insure your deposits against loss or theft. Hence, the Reserve Bank of India authorises Deposit Insurance and Credit Guarantee Corporation to safeguard your finances.
