You can open digital savings accounts online instantly through your PAN and Aadhaar card by downloading the bank’s mobile app or visiting the bank’s website. As savings account comes in various types, similarly not all online savings accounts are equal. Banks offer distinct features on their online savings account to their customers.
Kotak 811, Axis ASAP, digisavings, IndusInd online savings account are some of the prominent online savings account.
Are you planning to open a digital savings account online? In this article, we will discuss the different types of digital savings account to help you decide the best one for you.
Zero balance online saving account is the most popular category of digital savings account. Most of the digital accounts are zero balance accounts. This means that there is no minimum monthly average requirement. So there is no penalty for not keeping the required minimum balance.
As these accounts don’t have any minimum initial deposit, you can open these accounts with no initial deposit. These accounts give you the freedom to keep and withdraw money as and when required.
Kotak 811, digisavings account and India Post Payments Bank digital savings account are few examples of zero balance online accounts.
While many banks open online savings account with no initial funding, customers of a few banks need to do an initial funding of say Rs.10,000 to open a zero balance account. These accounts don’t have any minimum balance requirement, but it requires initial funding to continue with the zero balance account.
Customers of Indus Online Account – Instant Funding Account, a variant of IndusInd Bank’s online account, needs to make an initial funding of Rs.20,000. After the funding, customers can use the account like a zero balance account.
Axis ASAP account is another zero balance account that requires an initial funding of Rs.10,000.
In some banks offering digital savings account, you can avail the zero balance feature after you open a different product such as recurring deposit (RD), set up a systematic investment plan(SIP), get a specific debit card or open a fixed deposit.
RBL Bank Digital Account has a minimum average balance of Rs.5,000. However, the average balance is waived off if you start a systematic investment plan (SIP) or a recurring deposit of Rs. 2,000 or more.
On the similar lines, the minimum balance is waived off for ICICI Insta Save FD digital account customers who will open an Insta FD of at least 10,000 for one year.
As mentioned in the previous point, customers can avail the 0 balance facility by opting for financial product, different variants of the online savings account have minimum balance.
E.g. if you open ICICI Insta Save Account, you will have two options to open a digital savings account with a minimum balance of Rs.10,000 or open a fixed deposit of Rs.10,000 for a year.
Indus Privilege Online Account and Kotak 811 Edge that are variants of Indus Online Savings Account and Kotak 811 respectively, have a minimum average of Rs.10,000. SBI Digital Savings Account has the minimum average balance as per the regular savings account. Currently, SBI has waived off the minimum average balance requirement.
Different financial institutions such as banks, small finance banks and payment banks offer digital savings accounts.
These banks are the top banks in the country and have the public’s faith. These are well-established banks such as Kotak Mahindra Bank, ICICI Bank, Axis Bank, etc.
Wide presence: These banks have wide presence across the country. Although you can open instant savings accounts online, it is necessary for the banks to have a presence in your vicinity. It is important for the banks to be serviceable in your area to provide you with various facilities such as physical debit cards, cheque books and to complete full KYC process.
Wide variety of products: Large banks offer a wide range of products from fixed deposits(FD), credit cards, loans and mutual funds, insurance etc. through their group entities. It becomes easier to avail these financial products as you already have an existing relationship with the bank.
Small finance banks are banks that can provide banking and lending services to customers. These banks are mostly concentrated in particular parts of the country. Currently, Ujjivan Small Finance Bank and AU Small Finance Bank, Jana Small Finance Bank and Fincare Small Finance Bank offer digital accounts.
Read: Ujjivan Small Finance Bank Digital Account
Read: Fincare Small Finance Bank Zero Balance account
Read :AU Abhi Savings Account
Higher interest rates: Small finance banks offer higher interest rates on a savings account than larger banks as they want to attract depositors. If you want to open an account because of the attractive interest rates, we suggest that you don’t keep the entire portion of your savings in these banks. As keeping your entire savings in a small finance bank is a risky proposition.
Read: Small banks that offer high interest rate on savings account
The recent Punjab and Maharashtra Co-operative Bank fraud can also take place in a small finance bank. Such a situation can be harrowing experience for the bank customers who have put all their faith in one bank.
Regional presence: Small finance banks have strong regional presence in few parts of the country. Hence, individuals living in a different town or city may not be able to open account.
Payments banks were created to widen financial inclusion. These banks can not lend loans or issue credit cards. Also, the deposit amount for every individual is capped at Rs.1 lakh.
India Post Payments Bank, Paytm Payments Bank are some payments banks that offer digital account opening.
Limitation on deposit: Customers of payment banks cannot deposit more than Rs.1 lakh. Hence, it may not be useful for people who are looking to save a sizeable sum of money.
Cannot access other financial products: Payment Banks don’t offer recurring deposit (RD) or fixed deposit(FD) besides credit products. In this segment, a small finance bank or large bank would be a better option.
How much you will need to open a digital savings account depends on the instant savings account that you want to open.
You don’t need any money to open Kotak 811 or digisavings account as these accounts have no minimum average balance and no minimum initial balance.
You can open a digital bank account after considering the various factors such as minimum balance, initial deposit, type of bank and the other facilities offered by the bank.
Conclusion: Most of us buy the thing of our desire after comparing products available in different platforms to get the best deal.
Similarly, opening an instant account should not be any different from shopping. Go through the various features of the accounts to arrive at the best online savings account for you.
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