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Savings Account
Simple bank interest calculations explained for the Savings Account customer
Key Takeaways
Interest on a savings account is calculated on your daily closing balance so each deposit or withdrawal changes what you earn.
- The bank applies the annual interest rate to the accumulated daily balances and credits the interest to your account every month.
- Maintaining a higher average balance and avoiding frequent withdrawals increases the interest you receive.
- Knowing how daily balance calculation and monthly crediting work helps you choose the right account and optimise your returns.
Banking activities like withdrawing and depositing funds, writing a cheque, using a debit card etc., can be grasped with experience. But to be a seasoned bank account holder, you must also understand how to calculate savings account interest to make the best use of monthly interest credits, aka compounding interest, offered by banks like IDFC FIRST Bank. This simple feature the bank offers ensures your money keeps growing month-on-month just by sitting idle in your savings account.
Let's understand the savings account interest calculation in detail.
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Savings Account Interest Calculation
A Savings Account is the primary reason why you have a banking relationship. It is the most liquid form of deposit, with no time limit or maturity rules.
The bank calculates interest on the balance you maintain, and the bank monitors your daily balance to calculate the interest
Daily balance X Number of days X (Interest rate/Days in the year)
With monthly interest credits, you get the interest amount based on your bank balance credited to your account every month. This means that the next time your bank calculates the interest on your bank balance, they will take this amount into consideration as well.
IDFC FIRST Bank Savings Account offers an attractive and competitive interest per annum, one of the best in the industry. Besides, unlike industry norms, the interest accrued on your IDFC FIRST Bank Savings Account is credited monthly. Your interest income with the IDFC FIRST Bank Savings Account undergoes a faster compounding, thus, a higher return in the long run.
Disclaimer
The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.
The features, benefits and offers mentioned in the article are applicable as on the day of publication of this blog and is subject to change without notice. The contents herein are also subject to other product specific terms and conditions and any third party terms and conditions, as applicable. Please refer our website www.idfcfirst.bank.in for latest updates.
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