Top features and benefits of a Salary Account

Opening a salary account is one of the first steps when starting a new job. A salary account allows your employer to directly credit your monthly salary into your bank account. As your primary bank account, choosing the right salary account is an important decision. Here is a comprehensive guide to help you pick the best salary account in India.

What is a salary account?
 

A salary account is a type of savings bank account opened by an employer with a bank to credit its employees' salary. It is different from a regular savings account in the following ways:

• No minimum balance is required to be maintained in a salary account. Regular savings accounts have minimum balance requirements.
• If salary has not been credited for 3 consecutive months, the account may get converted to a regular savings account with applicable minimum balance rules.
• Special benefits like free unlimited ATM transactions, zero fee banking services, higher interest rates, etc. are offered on IDFC FIRST Bank Salary Accounts.

Who can open a salary account?
  

Now that you know what a salary account is, let’s understand who can open it.

A salary account can be opened by employees whose companies have a tie-up with a bank.  If you don’t have an account with the bank your employer uses, they can assist in opening one for you. Put simply, individuals cannot open salary accounts independently as it requires a partnership between the business and the bank.

Importance of a salary account

Ease of salary credit: The major function of a salary account is to facilitate the seamless and quick deposit of your monthly salary. Employers directly transfer salaries into this account, which means you have timely and safe access to your funds without the need for manual deposits. 

Exclusive offers and discounts: Salary accountholders often enjoy exclusive deals and discounts. These can include reduced interest rates on loans, higher interest rates on savings, cashback offers, and discounts on several products and services. 

Automatic bill payments: The best salary account often comes with the facility to set up automatic bill payments. This feature allows you to schedule recurring payments for utilities, credit cards, and other bills directly from your account. This helps you make sure you never miss a payment deadline and build a good credit score.

Tax benefits: Many might wonder if there are any tax benefits available on salary accounts. These accounts allow you to invest in options such as fixed deposits, recurring deposits, mutual funds, sovereign gold bonds, and investment-linked insurance. During income tax filing, you can claim relevant tax exemptions based on these investments.

Benefits of a salary account
 

Some key benefits of choosing a salary account are listed below.

• No minimum balance

Salary accounts do not require maintaining any minimum balance. This makes it convenient for salaried individuals to operate the account without worrying about balance requirements.

• Unlimited free transactions

Most banks offer unlimited free ATM transactions on their own and other bank ATMs. This helps manage monthly expenses without transaction charges.

• Overdraft facility

Some salary accounts come with overdraft facilities allowing account holders to withdraw more than the account balance within a certain limit. This aids in managing monthly cash flow.

• Zero fee banking

In addition to already mentioned facilities, IDFC FIRST Bank Salary Accounts (Platinum Plus and Classic Plus) also offer zero fee banking on all common banking services such as ATM withdrawals, online money transfers, debit card and DD issuance, SMS alerts, chequebook re-issuance, cash deposits at branches, and more.

• Other benefits

Other benefits of IDFC FIRST Bank’s salary account include a personal accident cover of up to ₹50 lakhs and air accident cover worth ₹1 crore. In addition, as a salary account holder, you enjoy complimentary memberships on digital platforms such as:

-  TimesPrime membership for 1 year on your first salary credit above ₹25K

-  Swiggy One Flagship membership, renewed every quarter on spends of ₹5000 (UPI/DC) & salary credits for 3 consecutive months to IDFC FIRST Bank Salary Account

-  Amazon Prime membership, renewed every quarter based on 3 months of regular salary credits & Standing Instructions (MF SIP/ EMI/ CC Payments) of minimum ₹5000

IDFC FIRST Bank account holders enjoy higher interest earnings, premium debit card perks, a zero-balance requirement, unlimited free transactions, quick video KYC account opening, round-the-clock digital banking, personalised services, and end-to-end digitised processes.

Features to look for in a salary account
 

While choosing a salary account, look for the following key features.

• Bank's service network

Consider a bank with robust digital banking services and   a good branch and ATM network across your city, for quick and easy accessibility and operations.

• Digital banking platform

Choose a bank with a robust digital platform for managing accounts online/via a mobile banking app. Check for features like bill pay, fund transfer, mobile check deposit, expense management, etc.

• Interest rates

Compare interest rates offered on salary account balances by shortlisted banks. Higher rates would result in your account balance growing faster.

• Debit cards and limits

Check for a free debit card with higher daily ATM/POS limits and international usage facility. Also, see if the bank offers virtual debit cards.

• Overdraft facility

An overdraft facility with low-interest charges can help tide over month-end cash crunches. Assess your needs and look for OD options.

• Additional benefits

Consider additional benefits like a locker facility, trading account linking, relationship manager assignment, etc. offered along with a salary account.

Steps to open a salary account
 

Follow these steps to open a salary account.

• Create a shortlist

Shortlist 2-3 banks based on service network, features, interest rates, etc. Talk to existing account holders for feedback.

• Get the account opening form

Fill the account opening form accurately. Furnish all details regarding your identity, address, contact, nomination, etc.

• Complete the documentation process

Find out the documents required by the bank to open a salary account and keep them ready. Your PAN card, Aadhaar card, and passport are mandatory.

• Make the initial deposit

An initial deposit may be required while opening the account. However, with IDFC FIRST Bank you do not need any minimum deposit amount. 

• Get the employer letter

Get the salary certification letter from your employer for submission.

• Wait for your account to get activated

The account will be opened and activated once all documents are submitted. The account number and other details are communicated.

How to choose the best salary account?
 

Choosing the right salary account is an important decision that requires some due diligence. Your salary account becomes the focal point of your banking, so you want to pick the most suitable one aligned with your needs and priorities. Follow these tips for making the ideal choice:

• Assess your regular banking requirements

Analyse the typical volume of monthly transactions - deposits, withdrawals, fund transfers. This gives an idea of the number of free transactions you may require. Also consider needs like monthly branch visits, chequebook issuance, debit card preferences etc. Outline your anticipated monthly banking activities.

• Compare the interest rates on the salary account balance

A higher interest rate means faster growth of savings. Some banks also offer higher rates for premium account types and higher balances. Choose the bank that provides the best interest-earning potential on your balance.

• Carefully review the features and charges applicable on debit cards

Some premium accounts may include cards with airport lounge access and other deals. Make sure the benefits of the debit card are helpful to you. There should also be minimal charges on transactions.

• Assess the digital banking convenience provided

Go through all the digital banking features such as mobile/internet banking, bill pay options, payments transfer facility, etc. The bank’s mobile and net banking platforms should be user-friendly, secure, and packed with time-saving features. Convenient digital access can make daily banking a breeze.

• Find out about the overdraft facility

If availing overdraft is on your agenda, compare the overdraft limits, interest rate, and fees charged by shortlisted banks. Some may offer a pre-approved overdraft facility based on the salary amount. Choose a bank providing an OD facility best suited to your needs with reasonable charges.

• Go through feedback from existing account holders

Getting feedback from existing account holders of the shortlisted banks can provide further insights from first-hand experience. Going through the feedback provided by these account holders can shed light on any concerns or advantages that you should be aware of.

Why choose a salary account over a regular account?
 

While regular savings accounts can also serve basic banking needs, salary accounts have some distinct advantages. Please note that specific advantages may be different for different banks.

• No minimum balance requirements – Helps in avoiding penalty charges
• Unlimited free transactions - Helps in monthly banking without charges
• Overdraft facility - Cushions against month-end cash crunches
• Credit card fee waivers - Annual fees waived on credit cards
• Relationship benefits - Increased chances of securing personal/auto loans
• Insurance benefits – Get personal accident cover and air accident insurance with the IDFC FIRST Bank Platinum Plus and Classic Plus salary accounts. 

Considering the above benefits, salaried employees are better off choosing a dedicated salary account over a regular savings account.

IDFC FIRST Bank Salary Accounts
 

IDFC FIRST Bank offers one of the most feature-rich and beneficial salary accounts for Indian professionals and salaried individuals. Opening a salary account with IDFC FIRST Bank can give your finances and banking experience a major upgrade.

IDFC FIRST Bank designs its salary account to maximise your earnings and provide you the utmost convenience. You can enjoy one of the highest interest rates in the industry on your account balance, allowing your savings to grow faster.

Other useful features include overdraft facility against your account to meet urgent financing needs, and a dedicated relationship manager for personalised and priority banking services. IDFC FIRST Bank account holders can also access exclusive deals and discounts on dining, travel, shopping, entertainment, health services, etc. from the bank's wide partner network.

IDFC FIRST Bank offers state-of-the-art internet and mobile banking services packed with innovative features. You can open your account completely digitally via video KYC and instantly start banking. Personalised insights, instant loans, and more add to the convenience.

If you want a salary account that maximises your returns, upgrades your banking experience through innovation and technology, and provides convenience and flexibility, then IDFC FIRST Bank would fit the bill perfectly. Opening your account digitally takes just minutes but provides rewards for years to come!

Conclusion
 

Choosing the right salary account that aligns with your financial needs and priorities requires some research and comparison. As your primary bank account, it impacts your everyday banking experience. Follow the guide outlined above to pick the ideal salary account and partner bank. This will provide convenience, maximise earnings, and aid your long-term financial success.