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Savings Account Interest Rates

Savings account is one of the most essential investments. There are numerous banks in the country which provide attractive interest rates on savings accounts. The interest is calculated on a daily basis and is credited in a periodic manner.

  • Interest rates: 4% to 7.1% p.a. based on daily balance
  • Helps fulfil short-term financial goals
  • Hassle-free withdrawals
  • Start investing with minimum cash
More

Savings Account
  • Instant money transfer
  • 24x7 ATM withdrawals
  • Attractive rate of interest

Latest Savings Account Interest Rates from Top Banks

Find below High and Low Saving Account Interest Rates(Updated on 23 Jan 2020):

Bank Name Interest Rate
HDFC Bank Savings Account 4% per annum
ICICI Bank Savings Account 4% per annum
Axis Bank Savings Account 4% per annum
Kotak Mahindra Bank Savings Account 6% per annum
Yes Bank Savings Account 6% per annum on Savings Account balances below Rs.1 crore
Bandhan Bank Savings Account

Daily balance upto Rs.1 lakh. Interest paid half yearly - 4. 25% per annum

Daily balance above Rs.1 lakh. Interest paid half yearly - 5% per annum

Lakshmi Vilas Bank Savings Account

Daily Balance Upto Rs.5 lakh - 5% per annum

Above Rs.5 lakh - 6% per annum

IndusInd Bank Savings Account

Daily balance upto Rs.1 lakh - 4% per annum

Daily balance above Rs.1 lakh but less than Rs.10 lakhs - 5% per annum

Daily balance above Rs.10 lakhs - 6% per annum

RBL Bank Savings Account

Daily Balance Above Rs. 10 lakhs - 7. 1% per annum

Daily Balance Above Rs. 1 lakh - 6. 1 % per annum

Daily balance upto Rs.1 lakh - 5. 1 % per annum

Savings Account is one of the basic financial products that everyone must have and use. A savings account will let you save money, transfer funds, withdraw money and also will give you interest on the funds that you have in your account. Not many investment products in the market give you the dual benefit of liquidity and interest. But, a savings account will not only help you save some money but will also let you withdraw cash whenever you need it.

Depositing money in a savings account will help you realize your short term financial goals with ease. With banks offers different types of savings account such as specialized accounts for kids, savings account for women and pensioners savings account, you can choose a savings account that fits your lifestyle and usage.

One of the key points to note about a savings account is its interest rate. Read on to find more about how savings account interest rate is calculated and savings account interest rates for major Indian banks.

How is the Savings Account Interest Rates Calculated?

As per the new RBI mandate, interest on savings account is calculated on a daily basis based on your closing amount. The interest accumulated will be credited to your account on half yearly basis or quarterly basis depending on the savings account type and the bank’s rule. However, recently, the Reserve Bank of India has advised the banks to credit the interest on Savings Bank account on quarterly basis as it will be more beneficial to the customers.

Generally, the formula described below is used to calculate the monthly interest for a general savings account.

Monthly Interest = Daily Balance * (Number of days) * Interest / (Days in the year)

Assuming the daily balance is Rs. 3 lakhs and the interest on savings account is 4 per cent per annum, the calculation will work out as follows.

Monthly Interest = 3 lakhs * 30 * (4/100) / 365 = Rs. 986

TDS on Savings Account Interest

The interest amount that you gain from a savings account is referred to as “Income from Other Sources”. This interest must be filed for Income Tax Returns. But, TDS is not applicable for a savings account as per section 194 A of IT Act . Savings Bank Account Interest amount exceeding Rs. 10, 000 will be taxed at marginal tax rate of the concerned account holder. It is also important to note that interest from a savings account is not an exemption but a deduction. The deduction is allowed for interest incomes up to Rs. 10, 000 only and for this purpose, the savings account must be held with a recognized public or private bank or with the Post Office.

Benefits of a Savings Account

There are countless benefits that a savings account will offer you. Here are some of the major advantages of maintaining a savings account.

  • When you deposit money in a savings account, you can be sure that the money is secure. Whenever there is a financial emergency in future, the money can be acquired.
  • The money that is deposited in a savings account can be accessed at any point of time. In case of a sudden requirement, you can withdraw cash from your bank or from the debit card without any hassles.
  • A savings account will let you start investing with minimum cash. All you have to do is open a savings account with the minimum required deposit and start deposit funds whenever possible.
  • With a savings account, banks also give you the access to internet banking and phone banking which will open a whole new world of quick transactions. You can transfer funds using NEFT & IMPS, pay utility bills, check transactions and link credit card accounts to your savings account using Internet Banking facility without any hassles.
  • Select banks offer personal insurance benefits with savings account.

Minimum Balance Requirements in Savings Account

If you read the fine print for a savings account, you will come across “Minimum Average Balance Requirements”. Many banks use the terms minimum daily balance, minimum quarterly balance or just minimum balance. Average Balance means the amount that has to be maintained in your savings account over a certain period of time. Average Balance is calculated by summing up the everyday balance and dividing it by the number of days in the defined period.

For example, if a savings bank account has an average quarterly balance of Rs. 3000, the average of the daily balance in your account for that quarter should have been Rs. 3000. Instead, you can also have Rs. 5, 40, 000 as the balance for one day of that quarter.

If you do not maintain the specified balance requirements, you will have to pay a non - maintenance penalty.

Almost all major Indian banks now offer Basic Savings Bank Deposit Account (BSBDA) which is a zero balance account. No penalty will be levied and you can use your BSBDA account as a normal savings account.

Saving Account Interest Rate Calculator

A Savings Account Interest Rate Calculator will let you find out the interest that you will get from a savings account. In a Savings Account Interest Rate Calculator, you will be required to enter information like average balance and interest rate offered by the bank. You will also be required to select if the interest will be credit on a monthly, quarterly, half yearly or yearly basis. The calculator will output the interest that you will get for the daily balance and the savings account interest rate.

GST of 18% is applicable on all banking products and services from July 1, 2017 onwards.

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Savings Account Reviews

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  • ICICI Bank Debit Card
    "The One just a basic saving account"
    ICICI BANK
    0.5 2.0/5 "Expected more"
    I received The One titanium debit card recently for my new saving account. I tried to use it for 10% off in recent amazon sale but cannot avail the discount on it. When I checked with customer care, I have been told that this just a basic card and bank do not offer discounts on it, better upgrade card to coral debit card. So, I do not recommend The One saving account.
    Was this review helpful? 41
    , new delhi
    Reviewed on Oct 20, 2019
  • ICICI Bank
    ICICI Bank Debit Card
    "Good"
    ICICI BANK
    0.5 5.0/5 "Blown Away!"
    I am using ICICI debit card for almost 10 years. They have provided me a domestic card. There is no yearly charges because of my salary account. There is no benefits and the accessibility of the card is good. The daily withdrawal limit is sufficient. ATM's are pretty good.
    Was this review helpful? 72
    , kolkata
    Reviewed on May 12, 2019
  • YES Bank Debit Card
    "Good"
    YES BANK
    0.5 4.0/5 "Great!"
    I think its nice to apply, it has been very fast and easy let's see what happens next if its open means I'll be very much happy person, pleas let me no soon that I can be a customer of this bank I had pan card permanent account number and I didn't have addar card though.
    Was this review helpful? 99
    , hyderabad
    Reviewed on Mar 20, 2019
  • Kotak Debit Card
    "Better"
    KOTAK MAHINDRA BANK
    0.5 4.0/5 "Great!"
    I am having a Platinum Debit card from Kotak Mahindra Bank. The daily withdrawal limit is sufficient. I don't get any benefits on the card but its easily accessible everywhere. I got a hidden charges of 150 rupees which was debited from my account. There is no charges for other ATM swipes and there is no limitation.
    Was this review helpful? 117
    , mumbai
    Reviewed on Jan 28, 2019
  • Kotak Debit Card
    "Worst Kotak 811 services"
    KOTAK MAHINDRA BANK
    0.5 0.5/5 "Unacceptable"
    Opened an account in December 2018 not received any call from customer care for document completion till yet also visited the nearest branch and no action has been taken . Worst services of this bank . Even the executive and staff has not been responsible and their behavior is also very rude.
    Was this review helpful? 118
    , new delhi
    Reviewed on Jan 16, 2019
  • YES Bank Debit Card
    "Good"
    YES BANK
    0.5 4.0/5 "Great!"
    I think its nice to apply, it has been very fast and easy let's see what happens next if its open means I'll be very much happy person, pleas let me no soon that I can be a customer of this bank I had pan card permanent account number and I didn't have addar card though.
    Was this review helpful? 83
    , bangalore
    Reviewed on Oct 03, 2018
  • YES Bank Debit Card
    "SUPER BANK"
    YES BANK
    0.5 5.0/5 "Blown Away!"
    I've been using the YES BANK Edge credit card for a while. The Value of the points are really good. I've already accumulated more than 15000 reward points. I am really impressed with the card and their services. I never had any issues with them.
    Was this review helpful? 57
    , hyderabad
    Reviewed on Sep 19, 2018
  • YES Bank Debit Card
    "What to write? You can write a review about any Loan produc"
    YES BANK
    0.5 5.0/5 "Blown Away!"
    awesome great job i like your services i feel happy u provided help to need a urgent way tnq so much tnq bankbazar first time i am online visitor i cant explain how much i m happy bankbazar i would like too u say thnku bankbazaar your service is too much fast rapid
    Was this review helpful? 24
    , bangalore
    Reviewed on Mar 11, 2018
  • Kotak Debit Card
    "Good Bank"
    KOTAK MAHINDRA BANK
    0.5 4.0/5 "Great!"
    I have a Kotak Bank i opened through Online portal. It is Very Easy to Open .Zero Rupees Charges.I ordered for a Debit card of kotak bank i got it delivered.Kotak App is Very User Friendly to Everyone.Zero balance maintain No Extra Charges..Quite Good App
    Was this review helpful? 73
    , bangalore
    Reviewed on Feb 16, 2018
  • Kotak Debit Card
    "Decent Credit Card"
    KOTAK MAHINDRA BANK
    0.5 4.0/5 "Great!"
    I have a Salary account with them and the bank has offered a complimentary Credit card on the basis of this account. They have given me a Credit Limit of Rs.2.5 Lakhs, which I felt is quite a good one to have. One thing which let me down over here is their high interest rate. Also an added advantage is, they have good reward points system available with them.
    Was this review helpful? 42
    , chennai
    Reviewed on Jan 23, 2018
  • Kotak Debit Card
    "Good"
    KOTAK MAHINDRA BANK
    0.5 4.0/5 "Great!"
    I am using domestic debit card of Kotak Mahindra Bank. The daily withdrawal limit was 25,000 rupees which was satisfactory. I am using this debit card for the last six months. There is no charge for other ATM swipe. ATM facilities are good and enough.
    Was this review helpful? 44
    , navi mumbai
    Reviewed on Jan 04, 2018
  • ICICI Bank Debit Card
    "Good"
    ICICI BANK
    0.5 4.0/5 "Great!"
    I have converted my reward points into cash many times. It was very good. I hold Platinum Visa debit card. The withdrawal limit is more than 1L which is really good. My debit card is linked with Payback account on every purchase I used to get lot of points.
    Was this review helpful? 52
    , bangalore
    Reviewed on Nov 16, 2017
  • ICICI Bank Debit Card
    "Good service"
    ICICI BANK
    0.5 5.0/5 "Blown Away!"
    ICICI Bank provide good service. I m using it as my salary account frim 2012. Very minimal number of time I've visit bank for any support. Net banking service is really good and debit card most of the time I use it shopping or petrol bunk. Totally service is goods.
    Was this review helpful? 43
    , bangalore
    Reviewed on Nov 09, 2017
  • Kotak Debit Card
    "Good service"
    KOTAK MAHINDRA BANK
    0.5 4.0/5 "Great!"
    Within 4days of time I got the car loan from Kotak Mahindra bank. The customer support is good with Kotak mahindra bank. The rate of interest which they have offered was low, when compared with other banks. The required loan amount has been disbursed and I am happy with it.
    Was this review helpful? 40
    , hyderabad
    Reviewed on Oct 16, 2017
  • ICICI Bank Debit Card
    "Great banking service and good previlage"
    ICICI BANK
    0.5 5.0/5 "Blown Away!"
    I have recently upgraded my debit card to CORAL and not sure about the type of card. I am happy with withdrawal limit. The customer service and response was quick. ATM service is more enough, even after 4 transaction there is no extra charges. The mobile application is good and they don't charge extra for IMPS transfer. Specialty of the card is One Plus One Ticket on movie.
    Was this review helpful? 26
    , bangalore
    Reviewed on Oct 14, 2017
  • ICICI Bank Debit Card
    "According to your use"
    ICICI BANK
    0.5 4.0/5 "Great!"
    My friend use icici coral debit card it charges 499 +gst every year it gives good offer like buy one get one free on movies per month and payback points and refund on petrol pump if used debit card for payment but i want to say after all this if you are doing this things then only use this card becuse 577 per year is too much if you are not using this benefits
    Was this review helpful? 27
    , pune
    Reviewed on Oct 04, 2017
  • RBL Bank Debit Card
    "Ratnakar Bank Debit card "
    RATNAKAR BANK
    0.5 5.0/5 "Blown Away!"
    Ratnakar Bank debit card facility is too good. Very useful options for using debit cards at different pos and online payment system. Bank customers care facilities are also prompt in service with customer. RBL is rising bank in all villages.
    Was this review helpful? 106
    , pune
    Reviewed on Aug 21, 2017
  • ICICI Bank Debit Card
    "Excellent Service"
    ICICI BANK
    0.5 5.0/5 "Blown Away!"
    I am using ICICI debit salary account for the past 3 years and the service from ICICI and executives of ICICI was very helpful and service was really nice and the transactions were very fast also I am getting my OTP pin very fast compare to others and they providing me a very excellent service.
    Was this review helpful? 30
    , bangalore
    Reviewed on Aug 21, 2017
  • Kotak Debit Card
    "Kotak Mahindra Bank Fraud Services"
    KOTAK MAHINDRA BANK
    0.5 0.5/5 "Unacceptable"
    Kotak Mahindra Bank has **fraud banking services**. Rs. 800+ charge for other ATM Withdraws. 10000+ Charge for not maintaining minimum balance. 1000+ for delayed credit card payments. One Purchase = Service Tax+Conversion Charge+Interest Charge+Actual MRPâ?¦. **Close all your accounts** of Kotak Mahindra Bankâ?¦
    Was this review helpful? 91
    , bangalore
    Reviewed on Apr 06, 2017
  • Kotak Debit Card
    "GOOD BANK BEST SERVICES GOOD JOB NICEBANK GOODRELATIONSHIP "
    KOTAK MAHINDRA BANK
    0.5 5.0/5 "Blown Away!"
    SUPPORTING WITH A MINIMUM WORKING TIME BANK QUICK DESISION WONDERFUL JOB GOOD PROVIDED BY OTHER BANKS LIKE ICICI, HDFC , IDBI , AXIS AND MORE NATIONALIZED BANKS FUTURE GOOD BANK MANAGMENT GOOD ALSO SUPPORT AND THANKS TO ALL THEY ARE HELPING PEOPLE THANK YOU AGAIN..
    Was this review helpful? 60
    , vadodara
    Reviewed on Mar 26, 2017
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