Difference between Current Account and Savings Account | AU Small Finance Bank
Gateway to Digital Life. Download AU 0101.
What Is The Difference Between Current And Savings Accounts | AU Small Finance Bank

Difference between Current Account and Savings Account

    Savings Account and Current Accounts are types of bank accounts that serve specific purposes. Today, anyone can open a Savings Account to deposit surplus income and earn interest on it. At the same time, the Current Account is specifically meant to meet the banking needs of business entities and entrepreneurs who may need to carry out multiple transactions every day. 

    This blog will explore the finer differences between Savings Account and a Current Account.

     

    What is a Savings Account?

    It is the most basic Bank Account type that you can open with any bank or financial institution. A Savings Account lets you park your idle money, thus keeping it safe. Depositing funds is the best option rather than hiding them in your home’s locker, where the chances of theft are more. 

    Whenever you open a Savings Account, the banks generally give you a Debit Card that offers easy access to money through ATM withdrawal, plus you can also get your hands on offers by top brands.

    Opening a Savings Account also helps you earn interest on your deposited funds. For instance, AU Small Finance Bank, which is the largest Small Finance Bank in India offers AU Savings Account that lets you earn high interest rate, which is credited to your account directly through Monthly Interest Payouts. 

    Read More: - Monthly Interest Payout on Savings Account

     

    What is a Current Account?

    A Current Account is designed for businesses to manage daily transactions like cheque issuance, deposits, fund transfers, withdrawals, etc. Every individual who wants to start a business must open a Current Account with a bank. The account can be operated by public and private companies, proprietaries, associations, trusts, etc.

     

    Difference Between Savings Account and Current Account

    A Savings Account is different from a Current Account in many aspects. Below are some of the key pointers:

    • Purpose of opening the account

    There are several reasons why people open a Savings Account. Some people want to secure their funds, save for short-term goals, or simply want to build up an emergency corpus. Savings Accounts help you to earn high-interest payouts. On the other hand, the primary purpose of having a Current Account is to conduct frequent business/financial transactions.

     
    • Minimum balance in accounts

    In the case of a Savings Account, you must maintain a minimum balance. If you fail to maintain the required amount, the bank may levy Non-maintenance charges and you can also choose to opt for a lower AMB maintenance account.  Similar is the case with the Current Account, but the minimum balance requirement is generally lower than in a Savings Account.

     
    • Interest earnings

    Under Savings Account, interest on savings is earned by the account holder, but in a Current Account, you don’t get interest pay-outs as the deposited money is used for business transactions. If you open an AU Savings Account, you can earn high interest rate.

    Read More - Savings Account Interest Rate

     
    • Suitability

    So, with a Current Account vs. Savings Account, which one is suitable for you? A Savings Account is suitable for you if you are a salaried employee or someone with a continuous monthly income. If you are running a business, a Current Account will be suitable for you.

     
    • Transaction Limit

    Transaction limit is one of the main differences between a Current Account and a Savings Account. You have a transaction limit when you use a Savings Account. You can carry out about three to five transactions per month with a Savings Account without attracting any charge.

    You can transact without limit with a Current Account. This is because a Current Account serves entrepreneurs who need to carry out frequent transactions.

     

    What are the benefits of a Current Account and Savings Account?

    Let us learn what are the benefits of a Current Account and Savings Account. Both account types have their distinct features and benefits. 

    Depending upon the requirement you may have from a bank account, you can select any one kind of bank account over the other. You can open a Savings Account to make savings and a Current Account to carry out your regular business transactions. 

    While a Savings Account is a great account option to save and manage money for a salaried individual or a household, a Current Account is ideal for a sole proprietor or a business entity required to make multiple daily business transactions. 

    By opening an AU Savings Account with AU Small Finance Bank, you can avail several benefits. You can apply for various products like Mutual Funds, Demat Accounts, Insurance, etc. Current Account users can avail of the Overdraft facility, with the amount decided based on your three-month turnover in the Current Account and the average balance maintained.

    So, now that you know the difference between a Savings Account and a Current Account, you can get started with the account opening process instantly. Visit your nearest AU Small Finance Bank Branch to open a Savings or Current Account.

    If you prefer digital, with the help of our AU Video Banking facility, any 18+ individual with the necessary KYC documents can open a Savings Account online too. All business enterprises can apply for a basic Current Account online by filling out the online form. We will then contact you to complete the documentation.

     

    * T&C Apply*


Open Savings Account

Blogs & Articles