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Banks offer various savings account types, depending on the requirements and facilities.
The interest rate on savings accounts is calculated based on your daily closing balance together. The interest is credited to your account either monthly or quarterly, depending on the discretion of the relevant bank. Interest rate on savings account depends on the account balances and bank. Note that unlike FDs, savings account will not offer any higher interest rate to senior citizens.
Interest rates on savings accounts vary from bank to bank. Here is a quick comparison of the interest rates on savings accounts at SBI, ICICI Bank, HDFC Bank, PNB, Canara Bank (latest savings account interest rates as per bank websites).
SBI
For savings accounts with balances up to Rs 10 crore the interest rate is 2.70% and 3% for balances above Rs 10 crore.
HDFC Bank
The interest rate on savings accounts at HDFC Bank is 3% for balances less than Rs 50 lakh and 3.50 percent for balances greater than Rs 50 lakh.
ICICI Bank
On end-of-day balances less than Rs 50 lakh, the interest rate would be 3%. On end-of-day balances over Rs 50 lakh, the bank offers 3.50 percent.
PNB
Punjab National Bank offers interest rate of 2.70% on balances below Rs.10 Lakh and 2.75% on account balances of Rs 10 lakh to less than Rs 100 crore. PNB offers 3% interest on account balance of Rs.100 crore & above.
Canara Bank
Canara Bank offers interest rates between 2.90% to 4% for various amounts. The highest amount of 4% is paid on balances of Rs. 2000 Cr & above.
Indian Bank
Indian Bank pays interest of 2.75% on balances up to Rs 10 lakh and 2.80% on balances above Rs.10 lakh to less than Rs.200 crore. The bank offers highest interest rate of 2.90% on balances of Rs.200 Cr and above
Union Bank of India
Union Bank of India offers interest rate of 2.75% on balances up to Rs 50 Lakh and 2.90% on balances above Rs 50 lakh Rs 100 crore. The bank offers 3.10% on balances above Rs.100 crore Rs.500 crore and 3.40% on balances above Rs.500 crore Rs.1000 crore. The highest interest rate of 3.55% is paid on balances 3.55% on balances above Rs 1000 crores.
Savings account taxation
Under section 80TTA of the Income Tax Act, interest earned on a savings bank account is tax-free up to Rs 10,000. If the interest from these sources exceeds Rs 10,000, the extra interest on the savings account will be taxable. The maximum income tax on interest from savings accounts for seniors is Rs 50,000.
During the financial year, an account holder must compute and submit interest income from the various savings bank accounts.
The interest rate on savings accounts is calculated based on your daily closing balance together. The interest is credited to your account either monthly or quarterly, depending on the discretion of the relevant bank. Interest rate on savings account depends on the account balances and bank. Note that unlike FDs, savings account will not offer any higher interest rate to senior citizens.
Interest rates on savings accounts vary from bank to bank. Here is a quick comparison of the interest rates on savings accounts at SBI, ICICI Bank, HDFC Bank, PNB, Canara Bank (latest savings account interest rates as per bank websites).
SBI
For savings accounts with balances up to Rs 10 crore the interest rate is 2.70% and 3% for balances above Rs 10 crore.
HDFC Bank
The interest rate on savings accounts at HDFC Bank is 3% for balances less than Rs 50 lakh and 3.50 percent for balances greater than Rs 50 lakh.
ICICI Bank
On end-of-day balances less than Rs 50 lakh, the interest rate would be 3%. On end-of-day balances over Rs 50 lakh, the bank offers 3.50 percent.
PNB
Punjab National Bank offers interest rate of 2.70% on balances below Rs.10 Lakh and 2.75% on account balances of Rs 10 lakh to less than Rs 100 crore. PNB offers 3% interest on account balance of Rs.100 crore & above.
Canara Bank
Canara Bank offers interest rates between 2.90% to 4% for various amounts. The highest amount of 4% is paid on balances of Rs. 2000 Cr & above.
Indian Bank
Indian Bank pays interest of 2.75% on balances up to Rs 10 lakh and 2.80% on balances above Rs.10 lakh to less than Rs.200 crore. The bank offers highest interest rate of 2.90% on balances of Rs.200 Cr and above
Union Bank of India
Union Bank of India offers interest rate of 2.75% on balances up to Rs 50 Lakh and 2.90% on balances above Rs 50 lakh Rs 100 crore. The bank offers 3.10% on balances above Rs.100 crore Rs.500 crore and 3.40% on balances above Rs.500 crore Rs.1000 crore. The highest interest rate of 3.55% is paid on balances 3.55% on balances above Rs 1000 crores.
Savings account taxation
Under section 80TTA of the Income Tax Act, interest earned on a savings bank account is tax-free up to Rs 10,000. If the interest from these sources exceeds Rs 10,000, the extra interest on the savings account will be taxable. The maximum income tax on interest from savings accounts for seniors is Rs 50,000.
During the financial year, an account holder must compute and submit interest income from the various savings bank accounts.
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