Banking is a part of our everyday lives. It helps you take care of your finances securely and systematically. The introduction of digitalisation has made the banking sector more efficient than ever. You can make fund transfers, pay bills, invest, avail credit, and do much more at your fingertips. A wide range of banking services have also been introduced, promising an incredible banking experience.
You need a Bank Account to carry out banking, offline and online. A Savings Account, given its widespread popularity, is a basic account which allows you to save, earn, and bank. You can open it offline and online by completing a simple account opening process.
Before making any move concerned with banking, opening a Savings Account, or investing, consider its pros and cons. It helps you understand if the account is suitable for you.
It gives you a chance to think of ways to make the most of it. Following is a mention of the pros and cons of opening a Savings Account.
Pros of opening a Savings Account:
Fast and easy set-up
As mentioned before, you can open Bank Account online and offline. Typically, both processes involve the same steps. You need to fill out the account opening application form and submit documents.
The bank will verify your details and documents via the Know Your Customer process. Once the bank’s verification is complete, your account will be opened and operational in no time.
Instant access to funds
If you like to do things for yourself and your loved ones without worrying about finances, you can consider opening a Savings Account. It provides instant access to your funds.
• You can make direct transactions from your account in a matter of minutes.
• You can use the Debit Card to make offline and online transactions on the go.
• You can link your Savings Account to third-party payment apps such as Google Pay, Paytm, etc. This enables you to make cashless payments without any hassles.
You earn a modest interest rate on your Savings Account deposits. Every bank has a different interest rate offering. You should explore the market and compare all offers at hand. You should consider opening an account with a bank offering the highest interest rate on Savings Account to maximise your funds.
Cons of opening a Savings Account:
As mentioned, you earn only a modest interest rate on your Savings Account deposits. Exploring other options, such as Debt Funds, will be more viable if you expect a higher interest earning.
Since Savings Accounts are flexible, withdrawals can be very tempting. Maintain a minimum balance in your account. You draw a penalty for non-maintenance of minimum balance. You can conveniently add funds using the Banking app. You can get a higher interest rate on your Savings Account by maintaining a higher account balance or opting for the auto-sweep-in facility.