AU Bank, Utkarsh Small Finance Bank, Jana Small Finance Bank and Suryoday Bank are some of the small finance banks that offer high interest rates.
Many small finance banks have started operations in the last few years. These small finance banks like top banks also offer savings account, fixed deposits among other products.
As these banks are relatively new in the banking space, they offer high interest rate to attract customers.
AU Bank has transitioned from a finance company to bank in 2017. AU Financiers started their operations in 1996 and have remained a retail focussed institution serving the middle and low income groups. Bank customers are present in 11 states of the North, West and Central India.
AU Bank gives an attractive interest rate of up to 6.40% interest on savings account. Another unique feature of the bank is the monthly interest that is paid on its savings account. It helps customers to see the interest received without waiting for the quarter end. As a result, customers are most likely to be induced to save or park money in their savings account. And, as this is a savings account that pay high interest rate, your savings are going to increase faster.
Other feature of the savings account is the complimentary auto upgrade. As you continue to bank with AU Bank, you will receive a complimentary auto upgrade and get more benefits.
Utkarsh Small Finance Bank is a small finance bank from Varanasi. It was established in 2009 and currently have their services in 11 states and have a customer base of more than 15 lakhs.
The bank offers an attractive interest rate of 7%. While for most banks, give different returns on different balance slabs, Utkarsh Small Bank gives 7% interest irrespective of the balance in your savings account.
Maintaining an average balance on a monthly basis may not be able everyone’s cup of tea. Instead of monthly balance requirement, Utkarsh Bank has quarterly and half yearly balance requirement.
Jana Small Finance Bank, formerly Janalakshmi Financial Services received the final banking license to start banking operations on March 2018. The bank headquartered in Bengaluru, started their operations in 2008. The bank is available in 19 states and has over 500 branches.
Jana Small Finance Bank is one of the best small banks that offer high interest rate on savings account. It offers a high interest rate of up to 8%. However, the 8% is applicable for accounts having more than Rs.25 crore. The interest rate given by the bank starts at 5% that is offered for accounts having less than Rs.1 lakh. 6% interest rate offered by bank for accounts that have more than Rs. 1 Lakh and up to Rs. 10 Lakhs.
Here’s the detailed breakup of its interest rate:
|Savings Account Balance||Interest rate||Illustration|
|Up to Rs. 1 Lac||5%||5 % will be paid on balances up to Rs. 1 Lac|
|More than Rs. 1 Lac up to |
Rs. 10 Lacs
|6%||6% will be paid on incremental |
balances above Rs. 1 Lac & up to Rs. 10 Lacs
|More than Rs. 10 Lacs up to|
Rs. 5 Crores
|7%||7% will be paid on incremental balances|
above Rs. 10 Lacs & up to Rs. 5 Crores
|More than Rs. 5 Crores up toRs. 25 Crores||7.5%||7.5 % will be paid on incremental balanceabove Rs. 5 Crores & up to Rs. 25 Crores|
|More than Rs. 25 Crores||8%||8% will be paid on incremental balances|
above Rs. 25 Crores
In 2015, Suryoday Bank received the license from RBI to work as a small finance bank. It was the only bank in Maharashtra to receive the nod. Thus, it transitioned to a small finance bank from a mircrofinance.
Suryoday Bank is another a small bank that offers high interest rate on savings account. It offers a high interest rate of up to 7.25% on their savings account. The starting interest rate on savings account of the bank starts at 6.25% which is applicable for balance up to Rs. 1 lakh.
The bank also pays out monthly interest that is credited in the savings account.
Here’s the detailed break up of the different interest rate.
|Daily Closing Balance Slabs (Domestic)||% rate per annum|
|Up to and including Rs. 1 Lakh||6.25%|
|Above Rs. 1 Lakh up to & including Rs. 10 Lakhs||7.25%|
|Above Rs. 10 Lakhs||7.00%|
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Conclusion: Small finance banks offer higher interest than top banks. While the interest rate offered by these banks may be tempting, looking at the other features such as the track record, top management and geographical reach of the banks is also important. If you want to earn higher returns on savings account, you can look at depositing some money with these small banks. Otherwise, it is better to stick to the top banks.Tags: small bank, high interest rate on savings account
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