A savings account is a good option for parking cash. Though the interest rate is low, the high liquidity is an advantage. Every bank in our country offers this facility. State Bank of India, the country’s largest lender, offers its customers an opportunity to earn higher interest than a normal savings account. SBI Savings Plus account is a unique savings account that can help you to earn higher interest on your savings account balance.
This account is linked to multi-option deposit (MOD), a feature wherein surplus funds above a threshold limit from the savings bank account are transferred automatically to fixed deposits opened. The minimum threshold limit for transfer to fixed deposits is Rs 35,000.
On the other hand, in case the savings account balance falls below Rs 3,000, the amount would be deducted from an FD and would be credited to the savings account, thereby restoring the minimum balance.
The tenure of this term deposit ranges from one year to five years. The interest rate applicable will be the same as an FD of similar tenure.
The interest rates that SBI offers on FD between one year and five years is between 5.00% and 5.30%. On the other hand, SBI offers only 2.70% interest on a normal savings account balance.
As per the official website of SBI, all individuals having valid KYC documents are eligible to open a Savings Plus Account.
This account can be opened singly, jointly, or with either or survivor, former or survivor, anyone or survivor, etc.
There are some key features of a Savings Plus account. Take a look:
– Minimum threshold limit for transfer to multi option deposit (which is like an FD) is Rs 35,000.
– Minimum amount of transfer to MOD is Rs 10,000 in multiples of Rs 1,000 at one instance.
– No limit of the maximum balance.
– There is no monthly average balance requirement.
– Loan against MOD is also available.
– 25 free cheque leaves per annum.
– A passbook, ATM card, mobile banking, internet banking, SMS alerts facility are also available for savings bank account customers.
HDFC Bank and ICICI Bank also offer similar facilities to their customers. In the case of HDFC Bank, if the funds in a savings account become insufficient, the necessary amount will be deducted from an FD and would be credited to the savings account to restore the balance to the required floor.
ICICI Bank, another major private sector bank of the country, offers special Money Multiplier FD. Under this facility, all linked fixed deposits are enabled for an automatic reverse sweep when the balance in the savings account falls below Rs 10,000.
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