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Want to Close Your Old/Unused Bank Account? Read this first

It is always necessary to close your unused or old bank accounts to avoid inconvenience. Read below to know why it is important to close your old or unused bank account.

Many people switch from one bank to another bank account because of their personal or professional reasons. Some people just create a bank account and do not use it or forget about bank account.

Many people switch from one bank to another bank account because of their personal or professional reasons. Many times parents make bank accounts for their children which is rarely used once they get enter formal work force. Others just create a bank account and do not use it or forget about bank account. But having too many unused bank accounts may be hard to track especially if it comes with higher cost.

Hence, it may become imperative to close your old unused bank account. Planning to close your bank account, check the points mentioned below to know whether you should close your bank account or not.

High Charges:

Many banks carry a minimum average balance which you have to keep on a monthly or quarterly basis. Banks charge these fees irrespective of whether you are using the bank account or not. This means that you have to maintain a minimum average balance on the old account while you just use other account. If your bank has a high minimum average balance of Rs.10,000 or so and you don’t keep so much balance in your savings account, it is better to close your bank account rather than pay penalty.

However, if the average minimum balance is say Rs.1,000 and you are not missing out on anything by keeping this money in your old bank account, then you can continue with your account.

Low interest rate:

Savings account also offer interest rates. However, the rates will differ from bank account to bank account. Some bank accounts offer 3.25% while a few savings bank accounts like Kotak 811 offer interest rate of up to 5%. If your bank is offering a low interest rate and you hardly keep any amount in your savings account, then it is better to close your old account.     

Read: Top Banks that offer High Interest on Savings Accounts

Higher chances of fraud

Not using your bank account for a long time can attract fraudsters to peek in your bank account. Inactive bank accounts are the main targets of fraudsters. Hence, it is important to make sure that you that bank alerts are available through SMS and emails. So, if email and message communication is not available, then you won’t be able to know if there are any fraudulent activities taking place. Hence, if you haven’t used the bank account for a few months, you need to be aware so that your bank account does not fall in the wrong hands.  

Service issues:

Banks keep a track of your transactions. If you haven’t done any transaction through your bank account in the last two years, then your bank account is likely to be deemed inactive. While, banks do not stop the incoming transactions in your account,  other services like ATM facility, cheque book request, debit or credit card requests, transactions, online banking, will be restricted.

Now when you know the consequences of holding an unused or old bank account, what are you waiting for? Close your old account and get a fresh new digital account along with higher interest rate of up to 5%.

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