Current Vs Saving Bank Account
You have two major options when you go for opening a bank account for any reason when to open a current account or opt for its subcategory or to open a saving bank account or its subcategory. Every Bank Account may either be a saving bank account or a Current Bank Account or their subcategories.
As the names suggest, a Saving Bank Account is usually opened for Saving purposes whereas a Current bank Account is used for day-to-day expenses and personal needs.
Both bank accounts have Similarities and Differences and we will discuss both in the following lines.
Purpose of Account:
Both savings and current bank accounts have different purposes to offer.
Current Account is usually opened by a Businessperson to meet their business, day to day expenses and personal needs.
The current account is not for saving purposes in general conception.
For saving purposes, you may go for a saving bank account and its subcategories.
Savings Bank Accounts are usually opened by the Pensioners, Salaried persons, Housewives, students, dependents and investors to get profit against their savings.
Profit by Bank:
On the Current bank account, there is no profit for the customers but in the saving account or on their subcategories there is a profit for the customers on their savings.
On Saving Bank Account profit may be calculated on average balance or the lowest balance during a specific time period.
The Profit on Saving may vary in subcategories depending upon the frequency of the profit and the amount of deposit in the saving bank account.
The profit in the Saving Account will be increased if the amount of deposit is higher and vice versa.
Both Current and Business Bank Accounts may be used to deposit and withdraw money through ATM/Debit Card, Cheque book and through internet and mobile applications.
But the transaction limit for current accounts and their categories may be higher as compared to the saving bank accounts and their categories.
For Saving account maintaining a minimum balance in the account is low or zero as these accounts are not meant for frequent use. But for the current account, the minimum balance may be higher.
The initial deposit requirement for saving a bank account while opening an account is also low but in the case of the current account, it’s higher.
Bank current and Saving Accounts offer different features and many are tailor-made features depending upon the needs of the customers.
For a business person who usually needs to remit payments to suppliers in the form of payment orders, demand draft or online through bank branch using cheque or through digital platforms like a mobile application or internet banking. Businesspersons and traders have frequent needs of their business. Such a business person needs to have a bank account that offers these facilities free of cost and they are ready to fix certain deposit amounts as well. Bank Business Account usually has all these features tailor-made for the business individual.
As Saving Account is for pensioners, salaried persons, housewives and students type individual hence they need a bank account which offer them no minimum balance requirement and no maintenance charges.