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What Are The Different Types Of Bank Accounts?
Posted on Friday, July 19th, 2024 | By IndusInd Bank
Banks and financial institutions provide a variety of account options to meet the different needs of their customers. To make the most of your bank account, you must select the right option.
From everyday transactions to long-term savings, each type of bank account serves to help people and businesses manage their money effectively. If you are wondering what the different types of bank accounts are, check out this list:
1. Savings Account
It is the most common form of bank account, suitable for salaried professionals, college students, homemakers, retired citizens, and many more. You can deposit money into a savings account and withdraw it when you need. The money in your savings account earns interest as per the bank’s prevailing interest rates.
Savings accounts can be of various types.
IndusInd Bank offers three types of Savings Accounts online:
| Type of account | Indus Delite Account | Indus Max Multiplier | Indus Select |
| Unique feature | A zero balance savings account that can be opened instantly anytime, anywhere. | Offers the dual benefit of a savings account with higher returns on Fixed Deposits. | Offers a wide range of customised services, special privileges, cashback, and discounts, and more. |
Also Read: Open your Savings Account in 4 Easy Steps.
2. Current Account
From the different types of bank accounts, a current account is ideal for traders, merchants, and business firms. It is preferred by those who make more financial transactions than others. Usually, a current account allows limitless daily transactions. An overdraft facility that allows you to withdraw more than your account balance is also offered.
Current accounts can also be of various types. Each type can offer features suitable for a particular type of business and growth plan.
3. Salary Account
When you join a new firm, you are likely to create a new bank account with which the firm has a tie-up. This is your salary account, where the employer will transfer your salary.
These accounts are special savings account that allow you to receive your reimbursements and allowances sent by the employer.
4. Fixed and Recurring Deposit Accounts
The above types of bank accounts are apt for regular transactions. When it comes to long-term savings, a fixed deposit account or recurring deposit account is ideal.
With a Fixed Deposit (FD) account, you can deposit a lump-sum amount of money for a set period (tenure). Based on the tenure you choose, your deposited money earns interest at a fixed rate.
On the other hand, a Recurring Deposit (RD) account is one where you deposit a fixed amount of money periodically for a set tenure. Here, too, the deposited money earns interest as per the tenure chosen. For both FDs and RDs, the longer the tenure, the higher is the interest rate.
While you may be able to break the deposit before the tenure ends in both cases, it is not advisable. Your money will not be able to earn interest at its full potential. In some cases, it may attract penalty too.
5. NRI (Non-Resident Indian) Bank Accounts
Banks offer different types of bank accounts for Indians or Indian-origin people settled overseas. These include:
a. Non-Resident Ordinary (NRO) account: Allows NRIs to deposit their foreign and Indian earnings. Foreign earnings are converted into INR at prevailing rates. Interest earned on the deposits is taxable.
b. Non-Resident External (NRE) account: Allows NRIs to deposit their foreign earnings only, which is then converted into INR. However, interest earned is not taxed in India.
c. Foreign Currency Non-Resident (FCNR) account: Allows the NRI to deposit and maintain money in foreign currency. Interest earned is not taxable within India.
To conclude, there are various types of bank accounts in India. You must review your banking needs and look at how many types of bank accounts are available to meet those needs.
If you’d like to open an online bank account with IndusInd Bank, the process to do so is seamless, paperless, and 100% digital. Begin your journey of convenient banking with IndusInd Bank right away!
Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.
