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All you need to know about a Kids Savings Account

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In 2014, the Reserve Bank of India (RBI) permitted banks to offer savings accounts for minors. Since then, many public and private sector banks have been offering savings bank accounts for kids. These accounts are aimed specifically towards minors.

A kid’s savings account or minor’s savings account is an account that can be opened on behalf of a child at most traditional banks.

What are the features of a kid’s savings bank account?

Also known as a child savings account, it comes with facilities such as a cheque book, passbook, debit card, and internet banking, just like regular savings accounts. The interest earned is usually 3 to 4.5 per cent.

Children’s bank accounts usually need to have a minimum average balance. Some banks may offer a total waiver of the minimum average balance or keep the limit very low.

What are its benefits?

  • Helps children learn the value of money and savings
  • Helps them understand discipline in money matters
  • Teaches children to focus on priorities
  • Helps children apply and understand math skills when calculating compound interest
  • Helps children understand concepts like affordability and spending power

The key advantage is that your children can avoid simply collecting and storing money in their piggy banks. They instead get to become a part of the larger financial systemKids can also get familiar with the procedural aspects of banking and learn practical concepts such as interest and returns. When guided well, a children’s bank account can be the base for your child’s healthy saving habits in the years to come.

Here are a few things to consider before you choose a children’s savings account:


For children, banks let you open two types of accounts based on the age group:

  • Below the age of 10
  • Between the ages of 10 and 18

If your child is below 10 years, the account can be opened as a joint account. Here, your child and parent will be the joint holder. If your child is between 10 and 18 years, they can operate the account themselves. Once your child turns 18, the account will be converted into a regular savings account.

Monetary limits

You should ideally choose an account with the lowest minimum balance criterion, so that money is not unnecessarily locked. Also, you should choose an account that puts restrictions on withdrawal/expenditure through the debit card. This can help avoid unnecessary spending or the risk of the card being misplaced by your child.

Fund transfers

Check with the bank if the account allows you to transfer funds through NEFT. If you want to transfer money from your account to a minor’s savings account, the bank should enable you to do it.

Security and banking communications

A kids savings account offers security with zero liability. If there is misplacement or theft of a debit card, your bank will take prompt measures to resolve the issue. Facilities such as debit card transactions and internet banking are safeguarded and restricted from misuse by the bank. Banks will also provide you with regular updates on offers, transactions, and account updates.

What are the documents required to open this account?

To open a savings account for a child, you usually just have to provide a few documents. These can include the proof of date of the minor’s birth, proof of the relationship between the minor and the parent/guardian, PAN of the parent/guardian, a recent photograph of the applicants, and address proof.

Child savings accounts can be a simple and educational way for your child to have some savings of their own and also watch it grow with time. Keep in mind that most banks do not offer high-interest rates on these accounts. So, avoid using such accounts to generate big returns for the future.



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.