Savings Accounts (SAs) are a safe and secure way of parking surplus funds in your hands. They are also great at inculcating the savings habit. You can use one or more SAs as a base to help you easily manage your finances.
A Savings account is, in all likelihood, the first account that you would be opening when you decide to avail the benefits of banking. A high percentage of people retain their first saving account even after they’ve moved on to more complex banking products and services. Lets take a feature-based look at savings accounts and how they work:
Your money is instantly available to you. You can withdraw your money through a bank counter or from an ATM using your ATM / Debit card. You can also make payments or transfers either through Internet banking or through mobile banking.
The money on deposit in a saving account earns interest for you. Of course the interest rates vary from bank to bank and from account product to product, ranging from the ludicrous to the fairly reasonable.
Some banks also provide tiered interest rates with higher balances earning higher interest rates. The Maxi Save account from Citibank is one such account. It offers a tiered rate of interest ranging from 0% (for funds less than Rp10 million to 5.5% (for funds more than Rp 10 billion).
All saving account come with an ATM or a debit card. Now, many banks are increasingly offering internationally acceptable debit cards (with a Visa or a MasterCard logo) to their savings account holders.
This facility is usually provided with current accounts and not savings accounts.
Almost all SAs allow account holders easy access to their accounts via Internet banking and even, mobile banking, either through mobile-customized websites or through special banking “apps”. Fast, 24/7 phone banking services are also available for most savings account holders.
In addition to conventional savings accounts, there are other types of savings account; these include:
Foreign currency savings accounts – These accounts allow you to keep your funds in one or more foreign currencies. The ANZ Infinite Savings Account is available in two currencies: IDR (Indonesian Rupiah) and USD (US Dollar). The Citibank Regular Savings account, on the other hand, is available in Indonesian Rupiah and 9 other foreign currencies (USD, AUD, GBP, NZD, EUR, CAD, JPY, HKD, SGD). It provides 0.25% interest per annum on IDR balance, 0.50% interest per annum on AUD and NZD and 0% interest on other currencies.
Islamic savings accounts – These accounts comply with Shariah requirements and could be based on the principles of Wadiah (safe-keeping) or Mudharabah (profit-sharing).
The maximum amount of deposit insured by IDIC is Rp 2 billion per depositor per bank. If a depositor has several accounts in one bank, the balance of all depositor’s accounts will be added to calculate the amount of deposit insured.