How AU Small Finance Bank’s Savings Account Interest Rates Work?

By
Daily Excelsior
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AU Small Finance Bank proposes a wide range of savings accounts to meet the needs of additional customers. From zero-balance accounts to high-interest-yielding savings accounts, one can open an account digitally or visit the nearest branch. Here we will discuss the features, eligibility, interest rates, and process of opening various savings accounts with AU Small Finance Bank.

What is AU Small Finance Bank?

AU Small Finance Bank is one of India’s leading small finance banks, serving millions of customers. Headquartered in Jaipur, Rajasthan, the bank offers banking services like savings accounts, current accounts, credit card, fixed deposits, personal loans, two-wheeler loans, and MSME loans.

Importance of Opening a Savings Account

Opening a basic savings account helps inculcate the habit of saving regularly. The money saved can be used in emergencies, such as health, accidents, loss of job, or even further education. Proper financial planning is the first step toward achieving future financial goals. A high interest rate for savings accounts ensures that deposited money grows faster than inflation.

Features of AU Small Finance Bank Savings Account  

AU Small Finance Bank offers feature-packed savings accounts for all kinds of customers:

  1. Earn high interest rates on your savings, from 3% to 7.25%.
  2. Access your bank account easily through mobile and Internet banking.
  3. Open accounts and manage your banking needs online through video banking.
  4. Senior citizens can receive banking services at their doorstep
  5. Enjoy free cash withdrawals from any AU Small Finance Bank branch.

Types of AU Small Finance Bank Savings Accounts

AU Small Finance Bank offers specialized savings accounts for different customer segments:

  1. Regular Savings Account: For individuals looking for liquid savings
  2. Salary Account: For salaried individuals with monthly salary credits
  3. Women’s Account: Exclusive account for women
  4. Senior Citizens Account: Customized banking for senior citizens
  5. Digital Savings Account: Paperless account opening and banking transactions
  6. NRI Savings Account: Exclusive banking for NRIs with NRO & NRE accounts

Eligibility Criteria for Opening AU Small Finance Bank Savings Account

The eligibility criteria to open a savings account are simple:

  1. Individuals over 18 years old can open an account.
  2. NRIs and PIOs can open NRO & NRE savings accounts.
  3. To open a joint savings account, joint applicants should be over 18 years old.

Documents Required for Account Opening

The KYC documents needed to open an AU Small Finance Bank savings account include:

  1. Duly filled the account opening form
  2. Identity proof (Aadhaar/PAN/Passport/Voter ID/Driving License)
  3. Address proof (Aadhaar/Passport/Voter ID/Electricity Bill)
  4. Recent passport-size photograph
  5. For minors, documents of parent/guardian are also required

Who is Eligible for a Zero Balance Savings Account?

AU Small Finance Bank offers zero-balance savings accounts with no minimum balance requirements for:

  1. Regular individuals looking for a basic savings account
  2. Special segments like students, pensioners and financially weaker sections
  3. Basic banking needs of the rural population
  4. Small traders, hawkers, and vendors under Pradhan Mantri Jan Dhan Yojana

Those looking to open zero balance account can download the AU 0101 mobile app and open a paperless account instantly in a few minutes.

How are Savings Account Interest Rates Calculated? 

The interest on the daily closing balance in the AU Small Finance Bank savings account is calculated and credited as below:

Daily Closing Balance X (Rate of Interest / 100) X (No. of days for which amount remained in account) / 365

For example, if ₹1 lakh remains for 30 days at 3% p.a.,

Interest = 1,00,000 X 3/ 100 X 30 / 365 = ₹246

The interest amount is credited monthly, The more regular deposits you make and the higher the balance you maintain, the greater the interest income.

Taxation on Savings Bank Interest Income  

Interest income up to ₹10,000 earned on savings accounts across banks combined is tax-exempt under Section 80TTA. Interest income above ₹10,000 is added to total income and taxed as per the income tax slab applicable.

Summing Up

AU Small Finance Bank offers feature-rich savings accounts with attractive interest rates to encourage financial inclusion. Opening an AU Small Finance Bank account helps start the savings journey to achieve future financial goals. Higher balances allow one to earn optimal interest income on savings. Starting early and saving regularly is the mantra to create long-term wealth. One can open an AU Small Finance Bank savings account instantly online with zero balance from the comfort of home.

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