Current Account vs Savings Account: Here's what's right for you
The beginning of your financial journey is by opening a bank account. Different people have different ambitions, whether it is to safely store money and generate interest over the course of time, or to propel your latest start-up with frequent transactions and payments. Current account and Savings Account are two of the most common types of accounts offered in Retail and Private Banking. But, which option is the right fit for you? Let us understand the key features of each of the account types, and examine the difference between a Current Account and savings account, to assist you in deciding the right one for your financial aspirations and requirements.
Sometimes also referred to as a Checking Account, it is primarily intended for individuals with frequent financial transactions, like traders, entrepreneurs, businessmen, companies, firms, trusts and such. Historically, paper checks were the most common form of making payments, hence the term ‘Checking Account’. They usually offer a limitless number of daily transactions, but do not provide any earnings through interest, due to the deposit and withdrawal fluidity they offer. In turn, this also means that they usually require a high minimum balance to be maintained, to avail the benefits of the account. Most MSME owners, businessmen and other entrepreneurs would concur that ICICI Bank is the best bank for a Current Account, offering a wide range of services, including the ease of opening an account online, in a matter of a few clicks, from the comfort of your home. Gone are the days of standing in queues, filling up multiple forms and dealing with the delays in clearance of transactions, thereby causing loss in the form of cost of opportunities. The superior and seamless experience provided by ICICI Bank to its Current Account users makes it an ideal partner, in their financial journey.
As the name suggests, a Savings Account is for savings and accruing money. This is ideal for salaried people who wish to build their wealth for their short/mid/long term future goals. The minimum balance to be maintained is usually lower in these accounts. A typical Savings Account also offers an interest rate because the cash in your account is leveraged by banks to finance their investments and engage in lending activities. They subsequently share a portion of the gains achieved with you, in the form of interest on capital, thereby increasing your accumulated wealth over time. ICICI Bank offers a vast variety of Savings Account related solutions, with a gamut of benefits and add-on features. Opening an online Savings Account can be done instantly, using your Aadhar Card.
Current vs Savings Account:
The table provided, below, intends to serve as a quick and handy synopsis of some of the common differences between a Current and Savings Account. While certain other nuances or differences can exist depending on specific banks and their offerings, the below-provided table highlights the most common distinguishing features and principles.
|Criteria||Current Account||Savings Account|
|Purpose||Spending and Frequent Transactions.||Savings and Wealth Building.|
|Suitability||Entrepreneurs, Businessmen, Companies, Firms and such.||Salaried People With Regular/Monthly Income.|
|Interest Rate||Nil||3.5% - 4%, per annum, subject to change.|
Through the course of this article, we have discussed the difference between a Current and Savings Account. The principle being that both these types of accounts have been designed for different purposes, thereby providing different features. While a Current Account is primarily for carrying out daily transactions by people engaged in businesses and other professional activities, the Savings Account is targeted at wealth accrual and gains derived from interest on principal, for individuals (like salaried employees or pensioners etc.).
With the information and insights provided in this blog, you can now successfully decide which account type works the best for you and your needs.
ICICI Bank is a leading Private Sector Bank in India and offers both Current and Savings Account, which are extremely easy to open and convenient to operate, with a wide range of banking solutions for each of these account types, thereby ensuring a customised and tailor-made experience for every customer.
Aside from the differences examined, both these types of accounts are powered by ICICI Bank’s applauded common platform services like - Internet Banking, Mobile Banking, Online Tax Payment, 24x7 Customer Services via phone, chat, e-mail, ATM/Debit Card Services etc., just to name a few to ensure a smooth and simple banking experience.
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