Digital savings accounts have redefined the way investors treat a bank account. The account opening process of a digital savings account is simpler than a regular account. You can conveniently visit the bank’s website or, in some cases, download the bank’s app, to open the account.
However, selecting the best digital savings account is far from easy. Since the service is still at a nascent stage, very few banks offer fully digitised savings bank accounts. And for those who provide the option, the benefits and features differ widely.
In this post, you will find the seven ultimate tips you need to consider for opening the best digital savings bank account.
- Interest Rate
The interest rate determines the returns from your investment. Most banks offer lower-than-ever interest rates, ranging between 2.5% and 3.5%. However, some new private banks, such as RBL Bank, offer interest rates of up to 6.50% per annum for a daily balance above INR 10 lac. The massive difference in the interest rate of digital savings account and conventional accounts can result in higher capital appreciation.
- Minimum Balance Requirement
When you open a digital savings account with a bank, you have to maintain a minimum balance. The bank calculates the minimum balance on a daily, monthly, or quarterly basis. Hence, before opening a digital savings account, you must check the minimum balance requirement and the balance calculation method. For instance, if the minimum balance is calculated daily and the minimum balance is INR 25,000, you have to keep INR 25,000 every day. Any failure in maintaining the minimum balance may incur a penalty. Some banks, such as RBL Bank, waive off the minimum balance criterion for investors opening a SIP (Systematic Investment Plan) or RD (Recurring Deposit) with the bank.
- Simple Account Opening Process
Ideally, opening a digital savings account is a five-minute affair. If your bank takes any more time, you should think twice. To open an account, you need to visit the bank’s website and upload your PAN and Aadhaar Card images. In the next step, you will need to enter your personal details. As the final step, you will transfer the amount from a registered Indian bank to facilitate the digital account opening.
- Features
Modern-day private banks, such as RBL bank, provide multiple facilities for digital savings account holders through their banking apps. You can check transactions, transfer funds via IMPS, NEFT, or RTGS, get a virtual debit card, and invest in fixed deposits on the go. Moreover, you can apply for a physical debit card that you can use for cash withdrawals.
- Minimal Documentation
Before opening a digital savings account, you should keep your Aadhaar card and PAN card. Unlike a conventional bank account, which needs multiple documents, a digital savings account needs only two documents. Hence, before opening a digital account, inquire about the documents and choose the right bank.
- Reviews and Ratings
Banks that allow reviews and ratings on their website are typically more credible than those that do not. Hence, before opening a digital savings account, visit the bank’s website and check the reviews and rating section. Reviews are generally an accurate indicator of the bank’s reputation. Keep an eye on fake reviews, though. Any genuine review has the customer’s name and account type besides the review.
- Complimentary Benefits
Most banks nowadays offer additional privileges for digital savings account holders. The benefits include free air insurance, accident insurance, free mobile banking and internet banking, and free virtual or physical debit card. Enquire about the add-on benefits before opening a digital account.
Conclusion
Digital savings accounts open the door to unlimited possibilities. You can get inflation-beating interest rates, attractive value-added benefits, quick account opening, and convenient account handling. Remember to choose a bank that has a legacy and offers attractive terms.
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