10 banks offering higher interest rates in savings account, more than Fixed Deposits

New Delhi : Days after coronavirus pandemic struck India, the situation has become worse for the banking sectors as well as the cash flow has come down drastically, resulting in less interest rates on Fixed Deposits and savings account.

However, there are still banks which are offering higher interest rates on their saving accounts, even more than the interest rates some banks are giving on their Fixed Deposits.

"While a majority of public and private sector banks are currently offering interest rates in the range of 2.5-4 per cent per annum on their savings accounts, there are a few private sector and small finance banks that are offering up to 7.15 per cent per annum," Financial Express quotes Adhil Shetty, CEO BankBazaar.com 

Still, bank FDs are meant for capital preservation and suits especially those who are retired and need a regular income with high safety. “Amid heightened uncertainties fueled by the Covid-19 pandemic, capital protection has become as critical as capital appreciation. As such, it won’t be wrong to argue that risk-averse investors should continue investing in fixed deposits despite the lowering of interest rates in the recent past,” says Shetty.

All data compiled by BankBazaar.com (Image: Financial Express)

For those who want to open a savings account in these banks, the process has become very simple; the customer does not even need a branch visit to open his/her account.

"Some banks are now offering account openings with video KYC. Digital and contactless account openings are preferable today due to the prevalent health risks. You may provide any of the multiple officially valid documents such as PAN, Aadhaar or your driver’s license for your account opening," informs Shetty.

But, before you consider a savings account with any bank, make sure to consider a few important things. Shetty says, “A high-interest savings account could be a great way to secure and grow your basic funds maintaining high liquidity and without taking undue investment risks. However, investors would be well-advised to thoroughly check the fine print before applying for a new savings bank account getting complete clarity about things like minimum income requirements and minimum balance requirements. They should also consider the additional facilities on offer (like free ATM-cum-debit card), mobile banking facilities, service record, branch network, and track record of the banks before finalizing their decision.”