As the study suggests, over 80% of Indians now have savings bank accounts and the percentage seems to be increasing. However, if you ask how many of them are active users or deposit money in their accounts on a regular basis, the number will appear slightly lower.
Although Narendra Modi’s Jan Dhan Yojana was launched to improve financial inclusion by making banking more convenient to the poor, it has come up short. Many people did open their accounts as it was zero balance but they lack the financial knowledge and were completely unaware of how things work at banks.
So, if you are also one of such people who don’t know how banks functions, we will recommend you to follow our blogs regularly. From how to open bank accounts to how to close them, we will cover everything in different blogs.
But as of now and in this blog, we are mainly focusing on how to open saving accounts. But before moving on to the process, let us understand the concept of saving accounts first.
A savings account is one of the most basic types of bank account that people have. As the name suggests, the primary objective of such an account is to help people save money.
A savings bank account lets you deposit or withdraw money safely at any time. It is one of the most liquid investments and therefore, it’s easy to use it when needed for conducting transactions.
Compared to regular investments, one can easily withdraw money from his/her savings account, anytime, anywhere. In fact, nowadays, banks offer facilitates online banking to make the entire process of operating your account mobile and more convenient.
Usually, online accounts are high-yield because of higher interest rates. Besides, you can operate them using your PC, smartphone, laptop, tablet with an internet connection.
Opening a savings account is an easy task that may take an hour or sometimes just 15 mins or so. Usually, most banks in India have a similar process, so it’s quite simple to open one.
You can open a bank account in two ways: either you can apply in person, at the bank or online.
The conventional or traditional way of opening a bank account is by visiting the branch in person. The perk of using this method is that you can have assistance from the bank’s employees, who are appointed for this purpose.
Once you have filled up the account opening application form at the bank, you need to wait a few hours or days until your account is opened and ready to use.
For opening a bank account online, all you require is a laptop or mobile phone. You can start the process with just your mobile number, and the rest of the process doesn’t alter much.
You are simply required to upload your documents and form to the online portal, instead of physically going to the bank.
You might be interested in learning how to open a fixed deposits account.
Whether you are gonna choose the online or offline method for the account opening, you do need to provide the documents as mentioned below:
ID proof (passport, driver’s license, etc.)
Form 16- a certificate issued by your employer stating that TDS has been deducted from your salary (this form is required in the case you don’t have a PAN card).
Two latest passport-sized photographs
A savings account is a virtual safe for keeping your money safe. Unlike a Fixed Deposit where you can’t withdraw before the maturity date, savings accounts allow you to access your money whenever you want. But that’s just a mini perk of why you should have a savings account.
A savings account let you make and receive money, payments, make investments, pay your credit bills, and more. Moreover, you can use your account for paying utility bills such as water bills, electricity bills, mobile phone recharges, internet, gas bills, etc.
The biggest benefit of having a saving account is that your money is completely safe. You don’t need to worry about thefts, damage (that may be caused by any calamities, anytime), money getting misplaced, etc.
If you are an Indian national, you can open a savings account, either individually, or jointly with another Indian national. All you need is an application form and the required KYC (Know-Your-Customer) documents.
In case you belong to HUF (Hindu Undivided Family), you are still eligible to apply for opening a savings account.
There are certain provisions for foreign nationals who are staying in the country for a longer period, due to business or other reasons and require making or receiving payments. Such individuals are required to provide the obligatory KYC documents along with the bank application form for opening the account.
In case you are interested in investing in the stock market and want to open a Demat Account, then learn how to open a Demat Account first.