Savings Account Vs Current Account: How different is the current account from the savings account, know here their difference and advantages
Current accounts and savings accounts are opened in the bank. To say that both accounts are used for deposits and transactions, yet both accounts are different from each other. Know their difference here.
A bank account is a need for everyone in today’s time. Both savings and current accounts are opened in the bank. Both accounts are used as deposits as well as for transactions, but still, these two accounts are not the same. There is a lot of difference between them. Let us tell you about it.
The Purpose of Both is Different
People open savings account with the intention of saving money. Regular savings accounts, salary accounts, zero balance accounts, and some special types of accounts for senior citizens, etc. are savings accounts only. They get 3 to 6 percent interest. On the other hand, if we talk about a current account, then it is different from a savings account. The current bank account is for those customers who regularly transact large amounts of money. It is specially made for the businessman. However, no interest of any kind is available on the current bank account.
Minimum Balance
Apart from zero balance accounts and salary accounts, it is necessary to keep minimum balance in most savings accounts. The penalty has to be paid for non-maintenance of the minimum balance. But this does not happen in the current account. In this, you get the facility to withdraw more than the available balance.
Transaction Limit
There is a limit on the number of transactions that can be done in a month from the savings account, but there is no such limit in the current bank account. Apart from this, there is also a limit to keeping the maximum amount in the savings account, while there is no such limit in the current account.
Tax Rules
Interest is received on the deposit in the savings account and the income earned by the customer in the form of interest comes under the purview of Income Tax, while no interest is received in the current account, hence it is out of the purview of tax.
Know These Benefits Too
Many banks offer life and general insurance on savings bank accounts. Account holders with savings bank accounts get a discount of 15 to 30 percent on locker fees. You can easily pay bills through a savings bank account.
In a current account, it is very easy for the account holder to deposit or transfer money through the draft. Many banks also provide doorstep banking facilities on current bank accounts. Account holders having current bank accounts can withdraw or deposit money from any branch of their bank across the country. Account holders also get loans easily on current bank accounts.
