Banking Saving Account Interest rate Increment: The minimum balance required to maintain a savings account varies from bank to bank. The insurance cover on your bank deposits have been increased five times.
Savings Account is the oldest and most common form of savings. People prefer saving accounts over any other form of savings as the principal amount is always safe no matter how much interest is earned. It can thus be said that the convenience of keeping the money in a bank account and earning interest is also the simplest form of investment.
However, the minimum balance to maintain a saving account is different for different Banks just like the rate of Interest. In case of not maintaining a certain minimum balance by an account holder, some penalty would be charged to him/her.
However, with the changes in other banking products, savings account has also seen a major shift from being minimum balance account to zero balance savings account. Many banks now offer zero balance savings account with high-interest rate which is more in demand as compared to the age-old pattern of keeping a few thousands in bank account to avoid penalties.
Some of the small finance banks offer better interest rates on savings as well as fixed deposits when compared to other top lenders.
IDFC First Bank savings account interest rate
Up to ₹1 Lakh 6.00%
> ₹1 Lakh 7.00%
For balances up to ₹1 lakh, IDFC First Bank gives an interest rate of ₹6% per annum (p.a.), and for more than ₹1 lakh in your savings account, the bank will give 7% interest
Utkarsh Small Finance Bank savings account interest rate
Balance upto ₹25 lakh 7%
Incremental balance above ₹25 Lakh to ₹10 crore 7.25%
Incremental balance above ₹10 crore 7.75%
For balances up to ₹25 lakh, Utkarsh Small Finance Bank gives 7% interest.
Ujjivan Small Finance Bank savings account interest rate
Up to 5 lakh 4%
> 5 lakhs to 50 lakh 5.50%
> 50 lakhs to 5 crore 6.75%
> 5 crore 7%
For balances up to ₹5 lakh in your savings bank account, Ujjivan Small Finance Bank gives 4%, and for more than ₹5 lakh to 50 lakh, the bank gives 5.50%
Equitas Small Finance Bank savings account interest rate
Up to ₹1 lakh 4.50%
Above ₹1 lakh and up to ₹1 cr 6.00%
Above ₹5 cr and up to ₹30 cr 7.25%
Above ₹30 cr and up to ? 50 cr 7.50%
Equitas Small Finance Bank gives 4.5% interest rate on savings up to ₹1 lakh. For balances above ₹1 lakh and up to ₹1 crore, the bank gives 6.00%.
These interest rates are higher than country’s top lender State Bank of India (SBI). SBI savings accounts fetch an interest rate of 3.25% on deposits up to ₹1 lakh. The interest rate on SBI savings bank deposits with above ₹1 lakh is 3%.
The insurance cover on your bank deposits have been increased five times. While presenting Budget 2020, Union Finance Minister Nirmala Sitharaman announced increasing the insurance cover on bank deposits from ₹1 lakh to ₹5 lakh. Ever since the crisis broke out at the Punjab and Maharashtra Co-operative (PMC) Bank, there have been demands to raise the insurance cover on deposits.