Feature Rich Savings Bank Accounts

Gone are the days of plan vanilla savings bank accounts. Increasingly more banks are trying to offer a chain of graded savings bank products to various segments of customers. These banks belong to foreign, private and public – all three sectors. Choosing a bank for opening savings bank account has become difficult because of variations in the product.

There is one underlying principle in all these product offerings, however. The higher the average balance you maintain in your savings account, the more rewards are offered to you. These rewards usually come in the form of:

Average quarterly balance

Rewards / Benefits

As you commit more AQB e.g., a)      up to Rs 10,000 b)      above Rs 10,000 up to Rs 50,000 c)      above Rs 50,000 up to Rs 1,00,000 d)      above Rs 1,00,000 up to Rs 5 lakh e)      above Rs 5 lakh

ATM Card on day ‘one’ Low charge -> free ATM/ Debit Cards Free access to other banks’ ATMs without limits Low charge -> free outstation cheques collections Low charge -> free money remittances Free RTGS, NEFT facilities Free net banking, mobile banking, sms banking Free SMS alerts Free ‘anywhere banking’ Free utility bill payment electronically Payable at par, multicity  cheque book facility PAN/TAN facilitation service Free of cost demand drafts, pay orders up to a limit Free demat account opening Concessional rates for buying gold coins in the bank Free ‘overseas travel card’ Online equity trading facility Free personal accident insurance Providing health insurance cover at reasonable rates Temporary overdraft facility in case of need Pick up of cash / document at customer’s door (up to specified amount & times a day) Delivery of cash / document at customer’s door (up to specified amount & times a day), etc

The above is just indicative. The rewards/ benefits indicated are not precisely linked to the increasing quantum of AQB linked in the left hand side.

Interestingly, grading and differentiations of savings are being done by all categories of banks. Examples:

Indian Overseas Bank, a prime public sector bank has array of products graded like Silver I, Silver II, Gold I and Gold II with increasing order of AQB requirements and levels of customer benefits/ rewards;

Yes Bank, one of the most promising and upcoming private sector bank has a slew of savings products like Savings Value, Savings Advantage, Savings Select and Savings Exclusive. These are in increasing order in the value chain with Savings Exclusive being the top end variant.

Lesson

If you are a discerning and demanding customer, you have to do some amount of home work before you decide where to open your savings account and what sub-type of account to open. You would do well trying to link your requirements with what are on offer in the marketplace.

Internet banking and the best way to set a password

PASSWORD

How to create and manage? Here is a suggestion you may like

Normally, you require a userid and a password to access your account. Many banks permit you to use your customer id as the userid and use it along with a password. The first time when you use the password sent by your bank, you are prompted to change it at once and give a new password of your choice. In this connection you may note the following for your guidance:

(a) There may be some guidelines for framing your password. It is usual to insist upon a standard length e.g., minimum of eight and maximum of twelve characters. You may also be prompted to include in it (i) alphabet; (ii) numerals; and sometimes  (iii) a special character e.g., *;

(b) You must keep your password a close secret. Therefore noting it down in diaries etc is considered to be risky. The best thing for you is to create a password in accordance with a system that it is not simple for outsiders to guess but yet easy for you to recall whenever you need it. May be you would find the following interesting:

Remember a song or poem you like e.g., meri deshki dharti sona ugle (song from the film Uphaar) and a special year e.g., 2007 when you passed out from your university. Now take the first letters of the words in the song and individual numeral of the year and intersperse them. It will turn to be M1D0D0S7U. You can make it tougher by adding a special character e.g., * at an appropriate place. The result a 10 characters robust password that has four alphabets, four numerals and one special character all as its components.

This is only an example. You may use your own choice of song and your special year to create your own password that would defy others’ imagination but would be easy for you to remember;

(c) Some banks may give you a separate password for transferring money from your account. This is called transaction password. You may like to transfer money to other accounts in your name or to a third party. Like the first level password, at first the bank sends you a default transaction password. You need to create your own transaction password the first time you use that default password.

Internet-enabled savings bank accounts

INTERNET ENABLED SAVINGS BANK ACCOUNT

What are on offer?

If your bank allows you to access your savings account through its website, it is of course an added convenience. Nowadays, most banks offer this facility. Therefore you may like to know the scope of services that are offered by various banks and examine their adequacy in the light of your requirements.

 The common services offered are:

(a) Accessing and viewing your account;

(b) Take a printout of account statement / transactions relating to specified period;

© Making specific transaction oriented enquiries;

(d) Cheque status enquiries;

(e) Viewing of account details of all accounts with trhe bank;

Higher level of services may include:

(a) transferring money to fixed deposit;

(b) closing a fixed deposit and retransferring money into savings bank account;

© transferring money to make a demand draft;

(d) transferring money to a third party;

(e) investing in mutual fund;

(f) making periodical payments for utility services e.g., telephone bill;

(g) online tax payments;

And more..

Interest on Savings Bank Accounts

Interest on Savings Bank Account

Rate and periodicity

The periodicity of interest payment in savings account is usually half yearly. However, some banks pay interest at quarterly rests.

For long, banks in India used to pay uniform rate of interest in savings bank accounts. However since October last year, the RBI has permitted relaxations and allowed individual banks to fix up their rates subject to a couple of conditions:

(a) A bank has to have one single rate for all savings deposits up to Rs 1 lakh;

(b) A  bank can offer different rates for savings deposits above Rs 1 lakh, but it cannot discriminate between two or more such deposits in terms of rate of interest if made on the same date at any of its offices;

This has already made some impact and you may be interested to know if any bank has begun to offer more for savings deposit?

Most of the banks presently offer 3.5% p.a. for savings deposits. However you must have observed spells of advertising by a couple of banks that they are paying much more.

Kotak Mahindra Bank is presently offering 5.5% p.a. on all savings deposit with balance up to Rs 1 lakh and 6 % p.a. for those with balance above Rs 1 lakh;

Yes Bank presently offers 6% on all savings deposit with balance up to Rs 1 lakh and at 7% p.a. for those with balance beyond Rs 1 lakh;

If you maintain heavy balance in your savings bank account, you may be keen about the rates of interest offered by various banks.

TDS on interest paid on savings bank accounts

Banks do not deduct any TDS on interest paid to savings bank accounts.

Know more about your ATM / Debit Cards

Receipt of Card and the PIN

It is common practice for banks to give savings bank accountholder an ATM or a Debit Card. A debit card can as well be called as an ATM cum debit card. However, after opening the account, you may have to wait for a few days to get your card in hand. In this connection, please note:

(a) The bank may send you the card and the PIN by separate couriers in a space of few days;

(b) The PIN is a four digit number which you have to use while operating the ATMs;

© You are advised to sign on the reverse side of the card, to prevent its misuse in case you lose it;

(d) Every card comes with an expiry date. Please note it and arrange to renew your card in time to avoid potential inconvenience and embarrassment.

Charges

Whether ATM or a Debit Card, the bank may levy two fold charges on you. First, the card issuance charges. Second, the yearly renewal charges. The quantum of charges varies across banks. However, some banks may exempt you from these charges depending on the average balance you maintain in your account. You need to check.

Differences between ATM and Debit Cards

The basic difference between ATM and Debit Card is that the former can be used only for operating ATM machines while the latter can be used in both ATM machines and also for making purchases in various shops and establishments including online purchases. Both these have a ceiling on the amount of cash that can be drawn in a day. The ceiling may differ across banks and this itself is a selling point for them. Between ATM and debit cards, the ceiling is usually higher in respect of the debit cards. Nowadays most banks issue debit cards instead of plain ATM cards.

Cash withdrawals using cards

(a) You can withdraw money from any ATM of your bank spread across the country up to the limit specified;

(b) You are also allowed to withdraw money from ATM of any other bank. You can do so five times in a calendar month free of any charge. Beyond that you would be levied with a fee for every additional transaction. (There are exceptions e.g., some banks offer unrestricted free of charge ATM access in select ATM networks to their valued customers;

(c) Few banks (like ICICI Bank, IDBI Bank etc) allow their customers to draw cash even from the POS (point of sales) terminals of their member establishments by using PIN based debit cards. The daily limit is Rs 1000.  The withdrawal is permitted whether or not the cardholder makes any purchases from the concerned shop / establishment;

The next post will deal with making purchases using cards issued by your bank.

Bank Support Contact Numbers (I to Z)

Some more bank support numbers:

Bank	Toll Free No	Other Number	Purpose
ING Vysya Bank	18004259900	080-30309900	24X7
ING Vysya Bank	18004209900	009118004259900	From outside India
J & K Bank	1800220600	0194-2481936
Karnataka Bank	18004251444		From BSNL/MTNL
Karnataka Bank		9108022021507
Karur Vysya Bank	18001021916	ATM/PoS/Debit Card, Internet, Mobile Bkg
Kotak Mahindra Bank	18001026022
Lakshmi Vilas Bank	18004252233
Oriental Bank of Commerce	18001801235	18003452424	ATM
Punjab National Bank	1800 180 2222	0120-2490000
SBBJ –State Bank	18001806005
South Indian Bank	18008431800	1800425 1809
South Indian Bank		91-484-2365657
South Indian Bank	91-484-3939345	9146475458	Report lost/stolen ATM card
State Bank of Hyderabad	18004254055*	18004251825
State Bank of India	1800112211	18004253800
State Bank of Mysore	18004252244	080-22300020	Other than BSNL/MTNL
State Bank of Patiala	18001802010
State Bank of Travancore	18004255566
Syndicate Bank	1800 4256655	1800225092	Credit Card*
Tamilnad Mercantile Bank	18004250426	9842461461	Help Desk
UCo Bank	18001030123
Union Bank	1800 222244	022-25751500
Union Bank		912225719600	In nine languages
United Bank of India	18003450345	18001033470	ATM card hot
United Bank of India		18001033470	-listing/blocking
Vijaya Bank	18004259992	18004254066	Internet Bkg
Yes bank	18002000	912230993600	From outside India

Bank Support Contact Numbers (A to I)

Following are some useful bank contact numbers. These have been collected on 11th June, 2012.

If you have any corrections / new information, please post a comment.

Bank	Toll free no	Other Number	Purpose
Axis Bank	18002095577	18002335577	Credit Card-loss
Axis Bank		022-67987700	Debit Card -loss
Bank of Baroda	1800 22 33 44	1800 22 0400	Debit Card
Bank of India	1800 22 00 88	1800 425 1112
Bank of Maharashtra	18002334526
Canara Bank	1800 425 0018
Catholic Syrian Bank	18002669090
Central Bank	18002001911
City Union Bank	18001035506
Corporation Bank	1800 425 3555	1800 22 6606	Credit Card
Corporation Bank		1800 425 2407	ATM/Debit Crd
DCB Bank	18002095363
Dena Bank	18002336427	Internet/Mobile/ Debit & ATM Cards
Dhanalakshmi Bank	18004251747	08067213000
Federal Bank	18004201199	914842630994	From outside India
IDBI Bank	1800221070	18002001947
IDBI Bank		1800226999	Debit Card
Indian Bank	180042500000	18004254422	ATM Cards
Indian Overseas Bank	18004254445	18004257744	Credit Card
IndusInd Bank	1800220061	02244066666
IndusInd Bank		18005005004	Premium bkg