How to Open a Bank Account

Bank accounts are an efficient solution to saving huge amounts of hard-earned money. Banks hold these financial accounts with the contribution from their customers and record transactions made from the bank to other accounts. They effectuate security and provide an exciting addon on the deposit. 

Furthermore, several financial products and features can assist an individual in appreciating their financial corpus. To open a bank account in India, one must walk to a bank and request a bank account application form. They would be required to submit identification proof documents duly for verification. 

Further, this blog entails how to open a bank account and all the essential requirements required in the process.

Eligibility Criteria to Open a Bank Account

The customer must meet specific requirements to open a bank account in India. This ensures that the benefits reach every customer without any differentiation. The parameters that are required to open a bank account are as follows: 

• Should be a citizen of India. If residing in another country, you should hold valid NRI or OCI cards. 
• At least 18 years of age is mandatory to open a bank account 
• Minors can open a bank account with the supervision of their legal guardians. 
• Adherence to the minimum balance policy is required
• Identification and residence proof should be legitimate.

How to Open a Bank Account Online?

One of the most convenient applications of technology and the internet is that one can open a bank account online without the hassle of visiting a branch in person. Opening a bank account requires clarity on the bank that you need to open a bank account. Ascertain the bank that you need to open a bank account in. Assess your options. Once you have selected your bank, follow the steps below to open a bank account online. 

• Visit the bank’s official website.
• Click on the option “open a new bank account”.
• If you want a different banking product, select the same from the main menu.
• Complete the application form by providing the correct information 
• You will be required to upload your passport-size photographs, signature, and documents to authenticate your identification and residential address.
• Once the application is submitted, the bank will take time to verify it.
• Post-verification, the customer will be notified of the account status. 
• A complimentary passbook, chequebook, and debit card will be issued to the customer.

How to Open a Bank Account by Visiting the Nearest Bank Branch?

To open a bank account by visiting the nearest bank branch, follow the steps given below. There are some pre-requisite steps that you need to adhere to. You would require to choose your preferred bank to open a bank account. Once you have chosen the bank, you must visit the bank’s nearest branch. 

• Once in the bank, speak to a bank agent regarding your purpose of visit and request a form. 
• Fill out the details asked in the application form
• There will be two sections. The first section will include details of the applicant, such as name, address, contact details, category, etc., along with work details and assets. The second section will include details you need to fill in case you do not have a PAN card. 
• Complete the application form without mistakes, as the information needs to match your identity documents. 
• You would be required to contribute to your new account depending on the type of account. In the case of a zero-balance account, there is no need for the same. 
• The application form will be considered for verification 
• The applicant will be sent a passbook and a chequebook post-verification. 
• You are also allowed to activate net banking therein itself. 

Documents Required to Open a Bank Account

To open a bank account, there are some documents required that the applicant needs to present to authenticate their identity and claims. The documents that are essential to open a bank account are as follows: 

• Aadhaar Card: This can be both identity and address proof. 
• Voter’s Card: This can be both identity proof and address proof. 
• Driving License: This can be both identity and address proof. 
• Passport: This can be both identity proof and address proof. 
• NREGA Job Card: This can be both identity and address proof. 

Choose Types of Bank Accounts to Open

Banks provide a platform for your money to be safely deposited that you can use whenever you need it. However, there are various types of bank accounts that offer varied benefits. Some of these types of bank accounts that a customer can open are as follows: 

• Savings account: The most common type of bank account is the savings account. This account helps users to save their hard-earned money safely. There is no limit to how much one can deposit. The limit balance might vary depending on the bank policies. You can get interested from a savings account ranging from 2% to 5% per annum. 
• Current account: This account is used by corporates and professionals for frequent business-related financial transactions. There is no provision of interest earnings. Moreover, the customer can deposit as much as they want. 
• Salary account: This account is opened by the working class to receive their salaries every month. These are generally zero balance accounts that users can open with the assistance of their employers.  
• NRI account: Non-resident Indians can maintain a bank account in India. There are three types of NRI accounts. Firstly, the Non-resident ordinary account (NRO) holds funds in the Indian denomination. Secondly, Non-Residential External Account (NRE) in which money is deposited in Indian denominations that are converted from foreign currency. Lastly, Foreign Currency Non-Resident Account (FCNR) holds funds in currencies approved by the RBI. 
• Recurring Deposit: A Recurring deposit account allows contributors to make monthly or quarterly, of half–yearly deposits that they can withdraw after the agreed term. The investment will be appreciated with interest rates as well. 
• Fixed Deposit: These accounts allow customers to make a lump sum deposit on which interest is accumulated over time. This makes the investment capital appreciate in the months to come. 

Things to Consider while Opening a Bank Account 

When you want to open a bank account, there are many aspects to consider. It is majorly because banks are not just there to be a piggy bank saver but also provide various benefits and opportunities in terms of financial security. It is therefore essential to understand what you can get from banking services. Here are some things to consider before opening a bank account. 

• One of the primary benefits of keeping a bank account is earning interest on your investment. Therefore it only makes sense to pick out a bank that gives the best outcome. Shop around a bit to best the best interest rate deal. 
• It will be prudent to research how much minimum balance is required for each bank. Majorly for private banks, the range of minimum balance lies between INR 5000 to INR 10,000. Other than that, the public banks usually have lower threshold rates. Furthermore, in some cases, there is no requirement of a minimum balance, such as a zero balance account. 
• Research the policies and products offered by the bank. See if you have a wide choice of options in terms of investment. Can you avail of a more significant return by investing in mutual funds through the bank? Are there competent fund managers hired by the bank? These questions can help you explore more options. 
• Another aspect to consider is whether or not you are availing of benefits such as debit and credit card facilities, cashback offers, credit limits, whether or not debit card transactions are chargeable, and so on. 

How Much Amount is Required for Opening a Bank Account?

If you are wondering how to open a bank account and what will be the minimum amount to maintain that particular account, then most public sector Indian banks adhere to a zero-balance or a minimum balance of INR 500 to INR 1000 policy. It is only when it comes to private sector banks that require a bit higher amount to open a bank account. For example, HDFC bank requires a minimum of INR 10,000 if one needs to maintain that account without any penalties incurred. Furthermore, there are premium service accounts that require high investment. For instance, a savings bank platinum account requires an individual to contribute INR 7.5 Lakhs per month. 

Different Services Offered by a Bank

Before one reads about how to open a bank account, it might be helpful to understand the different services offered by a bank. This can instil more clarity on why to open a bank account and what services to avail of. Firstly, the services offered by banks are major to provide customer-centric solutions, thereby creating a broader user base. Some of these services are discussed below. 

• Loans – The primary reason a bank was introduced in the first place was to provide people with necessary funds that they can pay back over a period of time. Banks charge a specific interest rate on top of the loan amount to make a little profit. Depending on terms, purpose, and interest rates, loans can have varied reasons and policies. 
• Credit Cards – If you don’t want a loan, there is an option of getting a credit card where you can purchase as per your requirements, and the bank makes the payment on your behalf. You can pay back the money monthly on an instalment basis. Credit limits may apply and vary from bank to bank.
• Savings Account – One can open a bank account and keep their hard-earned money with the bank safely and securely. Banks offer customers a wide range of savings accounts such as fixed, term, recurring, annuity, investment, current, etc.
• Cheques – Everyone who opens a bank account receives a few accessories such as cheque books, debits cards, passbooks, etc. These can be used for many purposes, including payments, identification, etc. 

Important Bank Features in the Modern World

The modern world has incorporated technology into every aspect of life. It has only become imperative for banks to step up their game and make the best use of technology. It has helped banks make quicker transactions, safer and more secure customer experience, and much more. Consequently, customers are increasingly interested in investing their money in banks. Some of the essential features of banks in the modern world that motivate a customer to open a bank account are as follows: 

• Internet banking – One of the most hassle-free uses of technology is that one can make huge transactions online within seconds. You can set up a net banking feature from the bank and make various payments such as IMPS, fund transfers, direct payments, electronic transfers, etc. 
• Banking Mobile Applications – With the development of applications, banks are setting forward to incorporate their features. This has eliminated the requirement of customers to visit a bank branch in person for various needs such as bank statements, money transfers, account balance queries, updating personal details, etc. 
• Unified Payment Interface – The UPI can assist real-time fund transfers between banks. This has drastically reduced an individual’s payment timings and needs to keep physical money.
• Financial Products – Today, financial institutions provide customers with various financial products other than just opening a bank account, such as fixed deposits, mutual fund investments, insurance policies, recurring deposits, etc. 
• Automated bill payment – Banks provide customers with the possibility of automating some of their recurring expenses that they otherwise would require to keep track of. With the automated payment feature, the customer can simply set up the payment with the bank, and every month, the timely payment transfer is ensured.