Salary Account Vs Savings Account
06 Jul 2022
Table of Content
A bank account is usually the first thing you need to begin your Savings journey. Indian Banks offer a wide variety of accounts wherein you can deposit money, earn interest income and build a corpus. Of these, the most common accounts are the Regular Savings Account and the Salary Account. In this article, we have compared the differences between Salary Account and Savings Account.
What is a Salary Account?
A Salary Account is a dedicated account where your employer deposits your monthly income or salary. Companies and corporations typically tie-up with banks to open Salary Accounts for their employees.
What is a Savings Account?
A Savings Account is one in which you can deposit money to build your savings. You can use this account to manage your day to day finances. Savings Accounts can be of various types, and a Salary Account is also considered a type of Savings Account.
Salary Account vs Savings Account – Comparing the Differences
The following are the differences between Salary Account and Savings Account.
• Minimum Balance Requirements
You can withdraw all the funds from the salary account, which is why it is also known as a zero balance account. However, with Savings Accounts, you must maintain the minimum average balance required by the bank. This amount differs from bank to bank.
• Account Holding and Operation Status
Employers open Salary Accounts for their employees, and the account is held and operated on an individual basis. As for Savings Account, you can open the account on an individual or joint basis and operate it jointly as well.
• Eligibility Criteria
You need to be employed with an organisation to open a Salary account and qualify for the benefits that go with it. However, there are no specific eligibility criteria to open a Savings Account. Anyone who can provide the necessary documents required by the bank can open this account.
• Account Conversion
Banks will automatically convert your Salary Account to a Regular Savings Account if no salary has been credited into it for three consecutive months. On the other hand, if you have a Savings Account with the same bank with which your employer has a banking relationship, you can convert the Savings Account to a Salary Account.
• Choice of Bank
Since companies have tie-ups with banks, their employees do not get to choose their preferred bank for Salary Accounts. Conversely, when you open a Savings Account, you can do so in your preferred bank after assessing their average balance requirements, interest offered on savings, and other critical parameters.
Similarities Between a Savings Account and a Salary Accounts
The common attributes between Salary and Savings Accounts are as follows.
- You can earn interest income on both Salary and Savings Accounts deposits.
- Banks provide you with chequebooks, passbooks and debit cards with both accounts.
- You can access both accounts remotely using services like internet and mobile banking.
- You can efficiently conduct online fund transfers via NEFT, IMPS, RTGS, UPI payments and wallets, etc., from both accounts.
- You can just as easily receive payments from anyone into both accounts.
- Banks provide SMS alerts and notifications for all transactions conducted on both accounts.
- You can utilise all the banking facilities such as loan applications, opening fixed deposits or recurring deposits, making investments, checking account balances, etc., with both Savings and Salary Accounts.
Account Opening and Interest Rates
In most cases, a bank representative visits your office to open your Salary Account. You only need to provide a copy of your PAN, ID, and address proof document, along with your photographs. The bank representative hands over an instant account-opening kit with the cheque book, passbook, debit card, and internet banking information. If you wish, you may apply for a personalised debit with your name embossed on it.
Unlike Salary Accounts, banks allow you to open a Savings Account online from the comfort of your home. You simply need to visit your preferred bank’s website, fill out an online form and submit scanned or soft copies of your PAN, ID, and address proof documents. The bank may conduct a physical or video-KYC procedure, after which it opens your account and sends you the cheque book, passbook, debit card, and internet banking information.
Note that the interest rates for both accounts depend on the bank with which you have the account.
Open Your Account with Bank of Baroda
Whether you wish to open a Bank of Baroda Salary Account or Savings Account, you can do so conveniently. While anyone can open a Bank of Baroda Savings Account, you must check with your employer if you can open your Salary Account with us. Enjoy attractive interest rates on your account deposits and take advantage of the incredible suite of facilities we offer to you as a Bank of Baroda customer.
What is a home loan Top-up-edited
AI in Defence sector
Bike Loan Documents
A Complete Guide to Gold Loans in India
The Ship Robots
What is Tenure in a Personal Loan and How to Choose the Loan Tenure Smartly?
Car Loan Process in India - A Complete Guide
Complete Guide on Banking Services for Women
What is Women's Savings Account?
5 Common Mistakes to Avoid While Investing in Fixed Deposits
Successful 7 Years of Pradhan Mantri Jan Dhan Yojana
Pradhan Mantri Jan Dhan Yojana - Everything You Need to Know
How To Open A Savings Account
Documents Required for Savings Bank Account
Features & Benefits of Savings Account
Difference Between Current Account and Savings Account
A Complete Guide to Savings Account
The contents of this article/infographic/picture/video are meant solely for information purposes and do not necessarily reflect the views of Bank of Baroda. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Bank of Baroda and/ or its Affiliates and its subsidiaries make no representation as to the accuracy; completeness or reliability of any information contained herein or otherwise provided and hereby disclaim any liability with regard to the same. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject Bank of Baroda or its affiliates to any licensing or registration requirements. Bank of Baroda shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.
Saving vs. Investing: Which is Better for Generating Wealth
Comparing savings and investments is like comparing apples and oranges. While they are both fruitful to your financial wellbeing, they are both very different concepts. Despite this, the two terms are often used interchangeably.
Salary And Pension Solutions for Indian Military Personnel - A Complete Guide
From safeguarding our nation from external threat to maintaining peace and security within the country, India’s Armed Forces protect all of us as citizens. For all the bravery and courage that they display on a daily basis, they truly deserve the best in return. To help military personnel maintain their finances, Bank of Baroda offers salary and pension solutions for Indian military personnel.
Leave a Comment
Thanks for submitting your details.