Target 40+ :Types of Bank Accounts in India

Types of Bank Accounts in India: Every commodity and every service nowadays is easily accessible with money. And all of your money can be swiftly transacted via a card or simply cash. But how do we manage this money or keep track of all these monetary transactions? No matter what profession you are in or even a student, your bank account and its statement make money management easy for you. What type of bank account suits you? How many types of bank accounts are there? Let’s find out.

This topic is also important for all the banking aspirants for their general and banking awareness skills. Questions on this topic can also be asked in the upcoming banking examinations. Candidates must read the article mentioned below thoroughly.

Types Of Banks Accounts In India

Banks provide people with a variety of options when looking to open an account which is based on the factors like one’s location, regularity of transactions, purpose serving for the account holder, etc.

Current Account

This account is a good option for people with a good frequency of transactions as there is no limit on the number of transactions per day. Businesses with a good amount of liquidity for payments and receipts use this type of account. There is normally 0 or minimum interest rate. 

Savings Account

Being a deposit account, the number of transactions is limited. But it does come with the benefit of a minimum rate of interest which depends on the duration of the account, depositor, etc.

Salary Account

This account is between the employer and the bank where the money gets credited at the beginning of their pay cycle and can be made accessible to the employee.

Fixed Deposit Account

FD accounts help you store money with a good amount of rate of interest. But the money in FD, as the name suggests is locked for a certain amount of time as chosen by the account holder.

Recurring Deposit Account

Unlike the FDs, RD doesn’t require a lump sum amount of money but the investment is done at regular intervals in small amounts. Similar to FDs, the amount of interest will be reduced if withdrawal is done prematurely.

NRI Accounts

Also known as the overseas account, there are 2 types of NRI Accounts, NRO or non-resident ordinary and NRE non-resident external. Banks also provide FCNR account (foreign currency non-resident) that help you to hold the money in the country’s respective currency.
The Non-Resident External (NRE) Account allows you to transfer your foreign earnings easily to India. However, this type of account is rupee dominated and can be opened in the form of Current, Savings, Fixed or Recurring Deposits.

The Non-Resident Ordinary (NRO) Account are primarily opened for depositing rupees earned in India. Foreign earnings can also be deposited in this account. When an Indian citizen goes abroad for a job with an intention to stay there, his resident accounts should be converted into an NRO Account by the bank. Therefore, it is essential to inform the bank about the individual’s departure abroad

Foreign Currency Non-Resident (FCNR) Accounts

The Foreign Currency Non-Resident (FCNR) Account can be opened in different currencies such as US Dollars, Canadian Dollars, Australian Dollars, Sterling Pounds, Euro, Japanese Yen, etc. These FCNR Accounts can be opened in the form of term deposits for the following maturity periods:

• 1 year and above but less than 2 years
• 2 years and above but less than 3 years
• 3 years and above but less than 4 years
• 4 years and above but less than 5 years
• 5 years.

Basic Savings Bank Deposit Account (BSBDA)

Basic Savings Bank Deposit Account (BSBDA), provides access to the best banking services, without requiring that you maintain a minimum balance. With our BSBDA account, you can access banking services across multiple branches ATMs and branches around the country. You can also check account information and transact digitally via internet and mobile banking services available on the account. It is also called no frill account.

Small account

‘small account’ means a savings account in a banking company where –

(i) the aggregate of all credits in a financial year does not exceed rupees one lakh;

(ii) the aggregate of all withdrawals and transfers in a month does not exceed rupees ten thousand; and

(iii) the balance at any point of time does not exceed rupees fifty thousand.

Types Of Banks Accounts In India: FAQs

Q1- Which account is best for businesses?

Ans- Current accounts are best for business as they are more liquid.

Q2- What is the difference between FDs and RDs?

Ans- In a recurring deposit account, money can be invested in small amounts at regular intervals whereas, in fixed deposit accounts, money is invested in a large amount.

Other posts

• General Awareness Quiz Series 2022: 23rd-27th October
• Types of cards used in banking system

• Most Important Question Related to Nobel Prize For Bank Exams

• GK Questions For GK Questions

Current Affairs