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  • Savings Bank Accounts v/s Current Accounts

    At an ATM, we are always faced with the option of choosing between a Savings Account or a Current Account. These are two kinds of accounts which have been set up to serve different purposes and address the financial needs of different kind of users. Current accounts and savings accounts are offered by almost all leading banks in India like ICICI, Axis Bank, SBI, Kotak Mahindra Bank, HDFC Bank, Citibank, YES Bank, IndusInd, and many more. However, both these accounts are different from each other in various aspects. Read on to find out more about what each of these accounts have to offer.

    Savings Accounts

    • A savings account is designed with the primary purpose to help you save.
    • This type of account allows the holder to deposit money as is convenient, on which the holder can earn interest.
    • A Savings account may be opened by an individual or jointly and requires the holder to usually maintain a pre-specified amount as minimum balance.
    • Interest rates earned on Savings Accounts range anywhere between 4% to 6%. These accounts do usually carry the facility of issuing cheques.

    Current Accounts

    • Current Accounts derive their name from the purpose they are suited for, regular transactions.
    • This type of account is more suited for users like firms, companies, public enterprises, businessmen, etc.
    • Currents accounts do not earn any interest due to the fluidity they offer.
    • Current accounts usually do not carry a limit on the number of transactions which can be made.

    Savings Account v/s Current Account

    A Savings account differs from a Current account in many ways and aspects. Both these accounts address different financial needs of the user, helping in better money management. Here are some of the major points based on which one can distinguish between a Savings and a Current Account.


    Savings Account: A Savings Account has been designed to encourage and promote savings

    Current Account: Is designed to facilitate regular or frequent transactions.

    Ideal For

    Savings account : ideal choice for any individual who earns a steady or regular income like salaried employees. This type of account is also ideal for those who have any short term financial goals to meet like a future vacation, financing a wedding, buying a car etc.

    current account : Is more suited individuals who are required to carry out frequent money transfers like businessmen, firms, companies, organizations, public enterprises, etc.

    Monthly Transactions

    Savings Account: Banks offering the facility of a Savings account do usually put a limit on the maximum number of transactions which a holder can carry out in a month. The permissible limit without attracting any charge is usually anywhere between 3 to 5 transactions per month (financial and non-financial).

    Current accounts: Do not have any limit on the maximum number of transactions which one can carry out. This is primarily because Current accounts serve the purpose of carrying out frequent transactions.


    Savings Account: Will usually earn you an interest between 4% to 6% on a pre-specified basis. Since these accounts do not allow unlimited transactions, it is easier to accumulate more funds over a period of time.

    Current Account: In the case of current accounts, banks usually do not provide any interest. This is due to the fluid nature of the account which allows frequent transactions.

    Minimum Balance

    Minimum balance is the minimum amount of money which must always be in your account in order to prevent it from de-activating or lapsing.

    For Savings accounts, the minimum balance required is usually low. However,

    For Current accounts, one may need to maintain a relatively higher amount as minimum balance.

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