Most of us would have heard of the terms, Savings Account and Current Account, but not all of us know the difference between the two. Read on to know how these 2 differ from each other.
Purpose:: A Savings Account is primarily designed with the goal of helping you save whereas a Current Account is designed with the goal of facilitating frequent transactions.
Ideal For:: A Savings Account is ideal for individuals who have a regular or steady income whereas Current Account is primarily for people owning businesses, organizations, firms etc. where there exists a need for a lot of transactions.
No. of Free Transactions:: Savings Accounts generally have an upper limit on the number of free transactions that can be carried out per month. Once the number is reached the banks may levy a charge on additional transactions that are carried out on the account. Current Accounts do not have a limit on the number of transactions that can be carried out per month, primarily because the main purpose of opening a current account is to facilitate frequent transactions.
Interest Earned:: Savings Accounts generally earn interest on the amount deposited into the accounts. Current Accounts however earn no interest as the money in the accounts is generally in a state of flux.
Minimum Balance Requirement:: Savings Accounts have a low minimum balance requirement compared to Current Accounts where the minimum balance requirement is higher.
The same concepts are explained in Hindi in the video below,
We hope that the points above would have helped you grasp the difference between a Savings Account and a Current Account. If you do have a doubt, please don’t hesitate to leave a comment in the comments section below, and we would try to respond at the earliest.
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