Savings Accounts are the most popular type of bank accounts meant for saving of your amount and getting interest on it. You have the flexibility of deposit your fund to or withdraw your fund from the account based on your requirement. Banks provides cheque facility to savings account holders. It can be opened and operated either in single name or in joint names. Generally, all the salaried employees as well as the pensioners have this type of account. The rate of interest offered on such account is between 4% to 7% per annum. With effect from FY 2012-13, interest earned on savings account upto Rs 10,000 in single financial year is exempted from tax.
Current Account are opened to enable the account holders to conduct their daily business transactions smoothly. These deposits are the most liquid deposits and there is no restriction on the number and the amount of transactions in a day. These are not used for investment purpose as mostly the banks do not offer any interest on such accounts instead they deduct some service charges on such accounts. Generally, the current accounts are opened in the names of firm or company.
Recurring Deposit Account is opened by the persons who wish to invest an average amount to bank on a regular basis. These are also popularly known as RD accounts. This account is useful for those persons who do not want to invest a large amount at single instance. Banks usually have fixed installment RD but now-a-days some banks also offer flexible RD where the person can deposit even higher amount of installment than previous installment. Any default in payment within the month attracts a small penalty. These are available for different maturities starting from 6 months to 120 months. The account holders get a passbook showing entries for all the deposits made by them and the interest earned thereon. The account holders can withdraw the amount alongiwth the interest on maturity of RD. Premature withdrawal of accumulated amount is also allowed with little penalty on early withdrawals.
Fixed Deposit Account are those accounts in which a fixed sum of money is deposited for a specified time usually for a period from 7 days to 10 years. A higher interest rate is offered on fixed deposits which varies from bank to bank according to the amount deposited and duration of investment. Private sector banks and foreign banks offer higher rate of interest as compared to public sector bank in order to attract more deposits. These are also popularly called as FD accounts. The account holders can withdraw the amount alongiwth the interest on maturity of FD. Premature withdrawal of accumulated amount is also allowed with little penalty on early withdrawals. Some banks also give facility to pay interest on quarterly or monthly basis on FD account.
NRO (Non-Resident Ordinary Rupees) Account is opened by an NRI (Non Resident Indian)/ PIOs/ OCIs to deposit his/ her India based earnings in Rupees in India and to deposit future income earned in India such as rent, dividends etc. The types of account can be Savings, Current, Fixed Deposit or Recurring deposit.
NRE (Non-Resident External Rupees) Account is opened by an NRI (Non Resident Indian)/ PIOs/ OCIs to deposit his/ her overseas earnings remitted to India converted to Indian Rupees. Earnings of India cannot be deposited in this account. The types of account can be Savings, Current, Fixed Deposit or Recurring deposit.
FCNR (Foreign Currency Non-Resident ) Account is opened by an NRI (Non Resident Indian)/ PIOs/ OCIs for keeping money denominated in US dollar, pound sterling, Yen, Euro, Australian dollar & Canadian dollar (other than Indian Rupees). These accounts can be Term Deposit only.