Best savings bank account to park 5-10L(emergency fund)

[ankitfintech]

Hi,
I want to open a savings bank account to park my emergency funds(5-10L). Which is the best bank account to open for this reqmt?

I have recently opened a ICICI salary account. Earlier my salary account was in Citibank which has now become savings account. Plus I also have BoB savings account. Will be closing Citibank account once I open new savings bank account.

I am thinking to open a Axis Burgundy account primarily due to the Burgundy Debit Card and also LtF Axis Select(which I may try to convert to Magnus). Are there any other bank accounts which have similar or better features?

 

[sheru]

Hi,
I want to open a savings bank account to park my emergency funds(5-10L). Which is the best bank account to open for this reqmt?

I have recently opened a ICICI salary account. Earlier my salary account was in Citibank which has now become savings account. Plus I also have BoB savings account. Will be closing Citibank account once I open new savings bank account.

I am thinking to open a Axis Burgundy account primarily due to the Burgundy Debit Card and also LtF Axis Select(which I may try to convert to Magnus). Are there any other bank accounts which have similar or better features?

As you want to park the emergency funds, i would say try to divide them in 2 parts.
1. Keep 75% amt in 2/3 bank's sweep in fd type or normal savings acc which is giving you best ROI (don't go beyond 5lac in any bank). This will make sure you have enough liquidity.
2. Keep 25% amt in 1/2 different P2P lending as they are giving best ROI with limited risk right now. This will bring the required growth to your overall funds.

 

[Walter White]

What about Sweep-in FDs? Are they any good?
Different terms in different Banks.

The only differentiator is the ability of automatic partial withdrawal in case account balance goes down without closing the entire FD. The amount that is withdrawn will fetch no interest irrespective of whenever that amount gets withdrawn.

 

[saucy]

Using BoB to park my excess funds under Tiranga scheme FD which gives 7.25%.

Time period?
Also pls share more details of the Tiranga scheme (links would also work)

 

[yuvaneshmohan]

Try small finance banks.. Fincare small finance Bank will give you around 7 percent intrest rate.

 

[Walter White]

Time period?
Also pls share more details of the Tiranga scheme (links would also work)

399 days.

https://www.bankofbaroda.in/persona...ed-deposit/baroda-tiranga-plus-deposit-scheme

 

[Chaitanya-a]

Try small finance banks.. Fincare small finance Bank will give you around 7 percent intrest rate.

Never park your emergency funds in Small Finance banks just to earn few extra interest. Your money would be safe upto 5L, no doubt but would you be able to access it? No one knows.

These banks create so much trouble for customers like account freezing and due to very few branches, we have to suffer a lot.

 

[Trust Me]

The only differentiator is the ability of automatic partial withdrawal in case account balance goes down without closing the entire FD. The amount that is withdrawn will fetch no interest irrespective of whenever that amount gets withdrawn.

Which banks don't pay any interest on the part withdrawn? Since it is an FD that is partially withdrawn, banks cannot get away without paying interest if the withdrawn part has run for longer than 7 days. It would be illegal otherwise. Of course, a premature withdrawal penalty may be applicable.

In any case, automatic partial withdrawal is also available with linked flexi deposits which imply no threat of auto sweep-in on the linked SB account. Signing up for an auto sweep-in sweep-out feature is not required for the privilege of having automatic partial withdrawal facility.

 

[Walter White]

Which banks don't pay any interest on the part withdrawn? Since it is an FD that is partially withdrawn, banks cannot get away without paying interest if the withdrawn part has run for longer than 7 days. It would be illegal otherwise. Of course, a premature withdrawal penalty may be applicable.

In any case, automatic partial withdrawal is also available with linked flexi deposits which imply no threat of auto sweep-in on the linked SB account. Signing up for an auto sweep-in sweep-out feature is not required for the privilege of having automatic partial withdrawal facility.

ICICI

 

[Trust Me]

ICICI

Did their T&C clearly specify that partial withdrawal of the FD would not earn any interest? And did you agree to that?

Would it be possible for you to post that T&C here?

 

[Walter White]

Did their T&C clearly specify that partial withdrawal of the FD would not earn any interest? And did you agree to that?

Would it be possible for you to post that T&C here?

ICICI Bank - Personal, Business, Corporate and NRI Banking Online

ICICI India's most trusted Bank, offers personal and business banking products and services including accounts & deposits, cards, loans, insurance, and investment products.

www.icicibank.com

 

[sauravkumar]

ICICI Bank - Personal, Business, Corporate and NRI Banking Online

ICICI India's most trusted Bank, offers personal and business banking products and services including accounts & deposits, cards, loans, insurance, and investment products.

www.icicibank.com

Bro nowhere it is written what you are saying.

I think you seriously have some misconceptions!!

Show us the email/document proof of website link where this is mentioned!!

And as far as I know I got interest everytime whenever I have withdrawn FD. In fact in I-Wish product also interest gets accumulated in principal amount!!

 

[Walter White]

Bro nowhere it is written what you are saying.

I think you seriously have some misconceptions!!

Show us the email/document proof of website link where this is mentioned!!

And as far as I know I got interest everytime whenever I have withdrawn FD. In fact in I-Wish product also interest gets accumulated in principal amount!!

Some amount was withdrawn from my sweep in FD. I had a FD of 25k.Now it shows FD opening amount as 25k minus the remaining amount and entire calculations are done on that amount.

Even on the iMobile app, it shows 26138 as the maturity amount.

I could be wrong though as I don't have a habit of reading complete T&Cs.

 

[Trust Me]

Some amount was withdrawn from my sweep in FD. I had a FD of 25k.Now it shows FD opening amount as 25k minus the remaining amount and entire calculations are done on that amount.

Even on the iMobile app, it shows 26138 as the maturity amount.

I could be wrong though as I don't have a habit of reading complete T&Cs.

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You probably mean that the new principal now equals the original amount minus the broken amount. Actually that's how it should work.

The applicable interest for the broken part should have been credited to your SB account along with the broken amount. Look for it in your SB statement. Actually it's easy enough to calculate this interest amount from the rate table applicable when the sweep-in FD was opened and the premature withdrawal penalty.

It's such an outrageous proposition to deny paying any interest whatsoever on the broken part of a sweep-in FD that it's impossible for any such product to even exist! Just think about it: this would likely remove any kind of yield advantage for a sweep-in FD over the plain SB rate! It could even prove to be detrimental.

It is a dangerous practice to sign up for something without understanding all about it.

 

[NikhilTravelLover]

I hold Kotal Sweep in and Out FD.

In my best knowledge, I am quoting.

Sweep in Facility or FD-
1.You can park the Idle ammount in sweep in FD.
2. You can partially withdraw the ammount without paying penalty.
3. Remaning amount will continue to get Interest rate.
4. If partially withdrwan amount is credited back in savings account, they will restart paying interest on total ammount.
5. Basically what they do in Sweep in FD is, they convert your amount in multiples of ₹1,so partial withdrawal is unaffeted.

E.G.
You have 1 lac Rs in saving bank account. You made a sweep in FD of 25K.
Your bank account will didplay total available amount 1 Lac. Suppose saving bank interest is 3% and Sweep in FD inerest rate 7 %.

So you will get 3% on 75 K and 7% on 25 K. But if you withdraw 10 K from bank, you still get 7% on remaining 15 K. You dont loose interest on total FD ammount(25 K in our case).

For reference-https://www.kotak.com/en/personal-banking/deposits/sweep-in-facility.html

 

[ankitfintech]

I hold Kotal Sweep in and Out FD.

In my best knowledge, I am quoting.

Sweep in Facility or FD-
1.You can park the Idle ammount in sweep in FD.
2. You can partially withdraw the ammount without paying penalty.
3. Remaning amount will continue to get Interest rate.
4. If partially withdrwan amount is credited back in savings account, they will restart paying interest on total ammount.
5. Basically what they do in Sweep in FD is, they convert your amount in multiples of ₹1,so partial withdrawal is unaffeted.

E.G.
You have 1 lac Rs in saving bank account. You made a sweep in FD of 25K.
Your bank account will didplay total available amount 1 Lac. Suppose saving bank interest is 3% and Sweep in FD inerest rate 7 %.

So you will get 3% on 75 K and 7% on 25 K. But if you withdraw 10 K from bank, you still get 7% on remaining 15 K. You dont loose interest on total FD ammount(25 K in our case).

For reference-https://www.kotak.com/en/personal-banking/deposits/sweep-in-facility.html

When you removed 10k from bank, why was it not deducted from the 75k in savings account? Did you mean that you removed specifically from sweep in fd?

Or its like whenever you withdraw your amount it's first taken out from sweep in fd? If that's the case why not park the entire 1 lakh(in general the entire amount of your savings account)
in sweep in fd?

 

[NikhilTravelLover]

When you removed 10k from bank, why was it not deducted from the 75k in savings account? Did you mean that you removed specifically from sweep in fd?

Or its like whenever you withdraw your amount it's first taken out from sweep in fd? If that's the case why not park the entire 1 lakh(in general the entire amount of your savings account)
in sweep in fd?

I have ellustrated the fictionary example here. I have not done any transactions like this.

But to answer your question, why not park entire amount in Sweep in FD- you can park, it's personal choice. But I guess one has to think about liquidity. Generally it takesmore than 24 hours to liquidiate in sweep in FD.

Another question-Different banks has different rules. One can set a preferences and threshold while withdrawls, so that one can choose from where the amount will be dedcuted.

 

[Trust Me]

The only differentiator is the ability of automatic partial withdrawal in case account balance goes down without closing the entire FD. The amount that is withdrawn will fetch no interest irrespective of whenever that amount gets withdrawn.

So were you able to solve the puzzle of the missing interest credit for your partially broken FD amount by checking your SB Statement more carefully? If you still haven't found this as a separate interest credit, are you going to confront ICICI for this interest that they owe you?

 

[Walter White]

So were you able to solve the puzzle of the missing interest credit for your partially broken FD amount by checking your SB Statement more carefully? If you still haven't found this as a separate interest credit, are you going to confront ICICI for this interest that they owe you?

Nhi aaya usme interest. Check kiya maine statement. Daalta hun ab unhe mail.

 

[Walter White]

Nhi aaya usme interest. Check kiya maine statement. Daalta hun ab unhe mail.

Btw, this is what I found on google:

The amount invested in the FD through the sweep-in facility can be withdrawn without breaking the fixed deposit. This way, you will not lose out on interest earned on the FD. However, if you choose to withdraw any amount, you will lose the interest earned on the amount withdrawn. The banks or NBFCs will not charge any penalties for withdrawing the swept-in amount from the fixed deposit.

 

[Trust Me]

Nhi aaya usme interest. Check kiya maine statement. Daalta hun ab unhe mail.

Yes, please do. But first have your calculations ready for the unpaid interest, so they can't deny it.

I know firsthand that ICICI dudes can wrongly program their software so it's not consistent with their own policy! Even the management would try to brush you off saying their system's calculations couldn't be wrong!

So I fought it out with them with all relevant documents and kept escalating it until I won.