What are the types of bank accounts?

Whether you’re a college student, a housewife, or a retired professional, not having a bank account is unimaginable. Based on the location of the account holder, frequency of transaction, and purpose, banks offer a wide range of bank accounts to choose from. Let me tell you what are the types of bank accounts.

It is a regular deposit account, where one earns a minimum rate of interest. Here, the no. of transactions one can make each month is capped. Banks offer a wide range of Savings Accounts based on the purpose of holding the account, features of the product, type of depositor, etc.

When you have a savings account with a bank, you get to avail special offers on opening a 2nd account like a DEMAT account.

It is a deposit account for entrepreneurs, business owners, and traders, who receive and make payments more frequently than others. These accounts hold more liquid deposits without any limit on the no. of transactions per day. A current account also allows an overdraft facility.

A salary account is the one you’ve opened as per the tie-up between your company and the bank. Your salary gets credited to this account. The bank, in which you have a salary account, also maintains the reimbursement account (where your reimbursements and allowances are credited to)

To keep your funds and earn a good rate of interest on it, there are different types of accounts like recurring deposits (RD) and fixed deposits (FD).

An FD account lets you earn a fixed rate of interest for keeping a certain sum of money locked in for a specific period of time that is until the FD matures. The maturity period of an FD ranges from 7 days to 10 years. The FD’s rate of interest depends on the FD’s tenure and generally, you can’t withdraw money from an FD before it matures.

An RD has a fixed tenure. You have to deposit a fixed sum of money regularly in this account –once a quarter or every month – to earn interest. In RD,  you are required to deposit a smaller amount more frequently unlike FDs where you have to make a lump sum deposit. Its maturity period can range from 6 months to 10 years and you can’t change the RD’s tenure and the amount to be invested each quarter or month.

There are different types of bank accounts for Indians or Indian-origin individuals staying overseas. These accounts are known as overseas accounts. They include 2 types of fixed deposits or savings accounts – Non-resident ordinary (NRO) and Non-resident external (NRE) accounts. Several types of bank accounts for NRIs include -

1. A) Non-resident external (NRE) fixed deposit accounts or savings accounts

2. B) Non-resident ordinary (NRO) fixed deposit accounts or savings accounts

3. C) Foreign currency non-resident (FCNR) account

Now you know what are the types of accounts in a bank.

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I hope I cleared all your doubts regarding what are the types of bank accounts.