What is a Child Savings Account?
When it comes to making kids financially smart, the key is to start the lessons young and be persistent. A Child Savings Account is a step in that direction because it teaches children to save their money and help them understand the basics of banking.
What exactly is a Child Savings Account?
A Child Savings Account is a type of Savings Account that is meant for kids below the age of 18. The parents or guardians of the child supervise this Savings Account. The procedure to open a Child Savings Account is not the same as opening an Employee Savings Account or a Standard Savings Account.
The main differences lie in the documents that have to be submitted to open a Child Savings Account and the benefits. Here are a few pointers to remember about these types of Savings Accounts.
- A child who is between the ages of 10 and 18 is allowed to operate the Child Savings Account with his/her parents’ or guardian’s permission.
- A guardian’s or parent’s Account has to be compulsorily linked to the Child Savings Account.
- When there is a shortfall in the minimum balance requirement in the Child Savings Account, the Bank charges a penalty that is either a percentage of the shortfall or a specific amount such as INR 500.
- The Child Savings Account has some similar features as any Regular Savings Account, like an E-mail Statement, Balance Enquiries, Passbook, an ATM Card, Daily Withdrawal Limits and so on.
- The Child Savings Account becomes inactive when the child reaches 18 years of age. Thus, the Account has to be converted to a Standard Savings Account after that.
Things to know about opening a Child Savings Account.
Go through the following facts before you open a Child Savings Account:
- ICICI Bank has made it compulsory to link your Account to the Child Savings Account for children below 10 years. The Child Savings Account for children between 10 to 18 years can be handled by the child.
- The Child Savings Account is no longer active after the child is 18 years old. Due to this reason, timely conversion of a Child Savings Account to a Standard Savings Account is necessary.
- You can turn on the notification feature for a Child Savings Account to get all banking related information – just as any other regular bank account.
- Child Savings Account also has a minimum balance requirement. Therefore, the parents or guardians need to pay attention and help maintain that balance. There are also daily and monthly withdrawal limits.
- Certain parental documents are necessary to open a Child Savings Account.
Documents required by ICICI Bank to open the Child Savings Account:
- Address and identity proof of guardian, such as Aadhaar card, PAN Card and others for verification.
- A recent passport size photograph of the guardian.
- Birth proof of the minor (Account holder).
- Declaration from the guardian.
ICICI Bank Child Savings Accounts for building a better financial future:
ICICI Bank offers two options under the Child Savings Accounts – Young Stars Account and Smart Star Account. The former is for anyone below 18 years, whereas the latter is for children from 10 to 18 years. Both the Accounts come with Debit Card benefits. That’s not all. You can use the Standard Instructions feature to regularly transfer cash from your Account to your kid’s Account. It comes with a daily spending limit that ranges from INR 1,000 to INR 5,000. And the best part is that these Accounts help in earning more interest than a Regular Savings Account - a win-win scenario!
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