Savings Account Interest Rates

Banks give interest on the amount parked in savings bank accounts. Savings account interest rates depend on multiple factors like the type of bank account, the amount of money, and the time the money stays in the account. 

Read ahead to know the best savings account interest rates and how savings account interest rates are calculated.

Which Bank Gives Highest Interest Rate on Savings Account

Here is a list of the top banks in India which will give you an idea about the best savings account interest rates -

Please note that the above rates are subject to change at the bank’s discretion.

How are Savings Account Interest Rates Calculated?

Prior to 2010, banks used to calculate interest based on the lowest amount that stays in the bank account between the 10th and the end of each month. But now, the calculation is based on the closing balance in your bank account at the end of each day. 

Apart from this, the interest is calculated based on the following factors - 

• Type of savings bank account

• The interest rate that the bank offers

• Amount of money in your bank account

As you keep spending money from your account, banks keep a check on the new closing balance each day. The interest is calculated and collated at the end of the month and is credited either on a monthly basis or every 6 months.

For a detailed description of the interest calculation, you can refer to this page. 

Is the Interest on Savings Account Taxable?

Yes, the interest you earn on savings bank accounts is taxable under ‘‘Income from Other Sources’’. But Tax Deductible at Source (TDS) is not applicable as per Section 194 A of the Income Tax Act. 

Taxes are not deducted if the interest earned is below Rs.10,000. In case the interest amount surpasses Rs.10,000, it will be taxable according to the tax rate of the account holder.

Conclusion

Savings account interest rates depend on multiple factors and are credited twice in a year in most cases. In case you want to know which bank gives highest interest rate on savings account, you can just head to the official website of the bank and refer to the ‘Interest Rates’ section.

Choosing a bank for opening a bank account can be often confusing, as there are so many banks. You can choose a bank depending on factors like interest rates, minimum balance requirement, accessibility, rules or withdrawal, and fees and charges levied. 

You can refer to this page for a comprehensive list of banks with their details, which can help you make the choice with ease. 

Having a savings account where your income gets credited directly also makes you eligible for an instant personal loan from moneyview. You can get loans from Rs.5,000 to Rs.10 Lakh for your requirements. To know more, you can apply on our website or download the moneyview app.