Eligibility Criteria for Opening a Savings Account Explained
5 min read | 5 months ago
Can Anyone Open a Savings Account? Here is a Guide on the Eligibility Criteria
Can absolutely anybody open a savings account? While it is not rocket science and does not have complex eligibility criteria, there are still a few requirements that banks and financial institutions have in this case. Let us take a look at these criteria with regards to opening a savings account for minors, adults and senior citizens.
Eligibility Criteria for Opening a Savings Account
To open a savings account, there are some eligibility criteria that need to be met. These include age restrictions, citizenship requirements, and KYC documentation. Let's look at these in more detail.
Age restrictions
In order to open a savings account, you need to be at least 18 years old. In some banks, these accounts may have lower minimum balance requirements and earn lower interest rates than regular savings accounts.
Citizenship requirements
To open a savings account, you must be a citizen of India in the regular scenario. However, non-resident Indians and people of Indian origin can also open savings accounts, like NRO or NRE savings accounts. NRIs need to provide proof of their NRI status, such as a work visa or a permanent residency card.
KYC documentation
KYC stands for Know Your Customer. Banks need certain documents to submit your KYC which will include your ID proof as well as your address proof. Your Government photo ID can be your passport, Aadhar card, driving license, etc. Address proof could include a utility bill, rental agreement, and so on.
Types of Savings Accounts
There are several types of savings accounts available in India. Let's look at the different types of savings accounts and their features.
Regular Savings Account
The main account that banks in India generally provide is a regular savings account. Most banks usually require a minimum amount to be maintained each month and pay a competitive interest on the balance. The bank interest rates on saving account can go up to 6.5-7% at some banks while others have comparatively lower rates hovering between 2.5-3.5%. Some banks may even offer high interest rates on regular savings if you maintain a high monthly balance.
Zero balance Savings Account
A zero balance savings account is a type of savings account where bank account holders are not required to maintain a minimum balance in the account. This is suitable for those who are beginning to save money and cannot maintain the average monthly balance of regular accounts.
Savings Account for Minors
Savings account for minors is a type of account that allows parents or guardians to open a savings account for their children. This type of account is designed to help children learn about the importance of saving money and managing their finances.
Senior Citizen Account
Senior citizens can avail of special savings accounts designed for them. These accounts offer higher interest rates, lower or no minimum balance requirements, and other benefits such as free cheque books.
Women's Savings Account
Some banks offer savings accounts exclusively for women. These accounts have lower minimum balance requirements, higher interest rates, and other benefits such as cashback offers and discounts on shopping.
How to Open a Savings Account
Opening a savings account is a simple process. Here are the steps involved:
Step 1: Choose a bank:
Research and compare the savings accounts offered by different banks to find one that suits your needs.
Step 2: Fill out the application form:
Visit the bank's branch or website and fill out the savings account application form. You will have to provide personal details and KYC documents.
Step 3: Submit the required documents:
Submit the completed application form along with the required KYC documents to the bank.
Step 4: Fund the account:
Once your account is opened, you need to fund it with the minimum balance required.
Step 5: Activate the account:
Activate your account by completing the necessary formalities, such as setting up internet banking and requesting a debit card.
Conclusion
Opening a savings account is an important step towards building a secure financial future. By understanding the eligibility criteria, types of savings accounts available, and the process for opening an account, you can make an informed decision in this regard. Do make sure that you adhere to the KYC and other requirements to ensure a hassle-free account opening process.
FAQs
1. Who is eligible to open a savings account?
Anyone who is at least 18 years old and has a valid government-issued ID can open a savings account. Some banks also allow minors to open an account with a parent or guardian as a joint account holder.
2. Can non-citizens or foreigners open a savings account?
Yes, non-citizens and foreigners can open a NRE or NRO savings account, but they may need to provide additional documentation, such as a passport and proof of address.
About Unity Small Finance Bank
Unity Small Finance Bank is committed to making banking simpler and more accessible for everyone. Our services include Savings Account, NRI account, Current Account, Fixed Deposits, and Personal Loans offering flexible tenures and attractive interest rates. We also offer financing options like MSME Loans and Microfinance to support businesses and underserved communities. Learn more about Unity Small Finance Bank here.
