Which bank gives highest interest rate on saving account in India

Which bank is better for savings account?

People often ponder upon many questions while choosing their banks for the first savings account such as Which bank gives highest interest rate on saving account in India? or How To Choose A Bank? or Which is best bank in India? or Which bank is best for zero balance account? or Which bank is best for salary account? or Best bank in India to open account?. But we are here to answer all these questions with respect to one of the most critical factors.

A savings account is an interest-bearing deposit account held at a bank or other financial institution. Anybody can open a Savings Account. Any Indian national can open a Savings Account, either individually, or jointly with another Indian national, with an application form and the required KYC documents. In fact, even a Hindu Undivided Family is eligible to open a Savings Account. While banks state Indian citizenship as a requirement for opening a Savings Bank Account, certain provisions have also been made for foreign nationals who stay in the country for a long term, due to business or other work, and need to make or receive payments; these individuals must simply provide the requisite KYC documents along with the application form. Though savings account typically pay a modest interest rate, their safety and reliability make them a great option for parking cash you want available for short-term needs.

A savings account offers various benefits such as cash deposit, withdrawals, safety, Net banking, online transactions, and interest rates. With these unfortunate covid-19 times online or cash free transactions have a necessity. Along with this you are also provided interest in form of savings rate on your savings amount.

Let us consider the story of the twin brothers. On their birthday, each of them was given Rs. 100 by their parents. While one of them kept the sum in his pocket and used it for occasional expenses, the other deposited the money in a bank, with simple interest at a rate of 5%. At the end of the year, while the brother who kept the money with him was out of money, the other one had Rs. 105 in his bank account.

This is a simple story to explain the concept of Saving Accounts and interest rates to children. But it is a perfect example that demonstrates the importance of a Savings Account, and how it can be beneficial to you. Traditionally the savings rate has been less than fixed deposit rate of interest but with new banks coming in and eyeing to increase their market share, some banks are even offering savings rate higher than fixed deposit rates of some banks such as SBI, HDFC, Axis etc. If you are considering taking first step towards your personal finance and planning to open a savings account, then below are the top 5 banks that can give you interest rates as high as 7.25%.

The minimum average quarterly balance (AQB) varies depending on the account. For Standard Savings Account and Premium Savings Account, the average quarterly balance must be ₹5,000 and ₹50,000 in urban areas, respectively.

5 Best private bank in India offering high savings rate

Among the private sector banks which are known for their prompt customer service and facilities DCB Bank offers the highest interest rate of 6.75 per cent among private sector banks. Then comes RBL Bank, which is offering up to 6.25 per cent, and Bandhan Bank, which is offering up to 6%. Here are the top five private sector banks that are presently offering higher savings account interest rates.

S.No.	Bank Name	Interest Rate (%)	Effective from
1	DCB Bank	3.00 to 6.75	10th June’21
2	RBL Bank	4.25 to 6.25	2nd July’21
3	Bandhan Bank	3.00 to 6.00	7th June’21
4	IndusInd Bank	4.00 to 5.50	4th June’21
5	Yes Bank	4.00 to 5.25	13th May’21

5 Best government Bank in India offering high savings rate

Although public sector banks are not known for offering facilities near their private sector counterparts but In India Public sector is looked upon with a sense of security and safety proven over the years. Among them Punjab National Bank promises the highest interest rates of up to 3.50 per cent, followed by IDBI Bank and Canara Bank with interest rates of up to 3.40 per cent and 3.20 per cent, respectively, among the top public sector banks. Below we have compiled a list of the top 5 public sector banks providing the highest savings account rates right now.

S.No.	Bank Name	Interest Rate (%)	Effective from
1	Punjab National Bank	3.00 to 3.50	1st March’21
2	IDBI Bank	3.00 to 3.40	1st May’21
3	Canara Bank	2.90 to 3.20	28th Sept’20
4	Bank of Baroda	2.75 to 3.20	26th May’21
5	Punjab & Sind Bank	3.10	12th Nov’20

5 Best Small Finance Banks in India offering high savings rate

Small finance banks are now offering higher interest rates than commercial banks and private sector banks. Utkarsh Small Finance Bank offers the highest interest rate on savings accounts, at 7.25 percent, followed by Ujjivan Small Finance Bank at 7.00 percent, AU Small Finance Bank at 7 percent, and Equitas Small Finance Bank at 7.00 percent. Refer to the prepared table below of the top 5 small finance banks currently offering the best savings account interest rates.

S.No.	Bank Name	Interest Rate (%)	Effective from
1	Utkarsh Small Finance Bank	5.00 to 7.25	1st Aug’20
2	Ujjivan Small Finance Bank	4.00 to 7.00	6th March’21
3	AU Small Finance Bank	3.50 to 7.00	17th May’21
4	Equitas Small Finance Bank	3.50 to 7.00	1st June’21
5	Jana Small Finance Bank	3.00 to 6.75	6th May’21

How do I choose a bank account to open?

How important is the criteria that which bank gives highest interest rate on saving account in India. Savings rate offered by all these banks is an added advantage of keeping your money in these accounts. And we recommend choosing the option after realizing your banking requirements and then further finalizing the decision with reference to the data shared above. This will help you answer which is the best bank for you!

Written by Monish Kumar

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