Once you start a career as a professional, you will need a salary account to get your earnings credited each month. This is your first step toward financial independence, and understanding the various salary account benefits will help you plan your finances better.
Opening this account takes just a few minutes and requires some documents. Most companies offer to open your account at the time of joining, which is an easier and faster option. Knowing all the perks it offers allows you to decide where your money is best credited and held.
Read on to know what is a salary account, how to open one, its features and more.
What is a Salary Account?
These accounts work similarly to savings accounts, through which employees get their monthly remuneration from employers. Most business organisations and companies tie up with various banks to create salary accounts for their employees.
With such an account, you can automatically enjoy benefits when you join the workplace. A salary account is meant to give you easy access to your earnings. This type of bank account gives you more than just the payroll benefits, as you can also earn lucrative interest too.
Also Read: Salary Account VS. Savings Account
Perks of a Salary Account
The salary account benefits and features will vary from bank to bank, but here are some common perks you can enjoy.
- Zero Balance
In most cases, you don’t need to maintain a minimum account balance, unlike a savings account, where you may have to pay a penalty when your balance is low.
- Banking Services
With this account, you can enjoy convenient banking services. For example, fund transfers or bill payments are easier and faster with such an account.
- Debit Card and Chequebook
You get a complimentary debit card, which you can use to withdraw funds from your nearest ATM or pay online and in person. You can also transfer funds using a chequebook and keep track of your transaction history in your passbook.
- Loan Facilities
Since lenders can easily review your income details, availing a loan with a salary account is easier.
- High Interest Rates
With this feature, you can grow your income by earning interest on the money in your account at the rate decided by the bank. This is a great way to earn additional income while enjoying liquidity.
Also Read: What Is Salary Overdraft?
Step-by-step Guide to Open a Salary Account
Regardless of which bank your employer has tied up with, the initial onboarding process remains the same. Thus, you can follow these steps to open a salary account.
- Step 1: Go to the online application system
- Step 2: Fill out the application form
- Step 3: Choose the preferred branch (if there’s an option for it)
- Step 4: Complete verification and KYC
- Step 5: Receive your welcome kit
Required Documents
While applying for your first salary account, you will need to submit some documents. The bank can ask you to provide the list of the following documents along with an application form:
- Aadhaar Card
- PAN Card
- Driving Licence
- Voter ID Card
- Latest photo passport-sized
For salaried employees, this account offers a way to manage finances without hassles. However, if you are short on funds, opting for a hassle-free loan is just as important. One such option you can choose from is Fibe Instant Personal Loan.
Get up to ₹5 lakhs Loan with a flexible repayment tenure of 3 to 36 months and a streamlined application process. Along with competitive interest rates, Fibe allows you to repay the loan with any foreclosure charges. Download our Personal Loan App or register on our website to easily access the required funds.
FAQs on Salary Account
What is salary account meaning?
A salary account means a bank account where you receive the compensation from your employer as per the terms of your employment.
Do I need to maintain a minimum balance in a salary account?
In most banks, there are generally no minimum balances for salary accounts. However, some banks may have a policy for minimum balances. You can check with your salary account bank in this regard.
Is a salary account automatically converted into a savings account when I switch jobs?
Every salary account is a type of savings account. If there have not been any salary credits in it for three months, it’s converted to a regular savings account. So, when you leave the job, you can still use it and access it as your savings account.
Can I open a salary account in any bank or only the one recommended by my employer?
Your employer initiates the process of opening your salary account at the bank where they have a tie-up. However, you can talk to your company’s HR to check if you can open an account in a bank of your choice.
Are there any transaction limits on salary accounts?
It entirely depends on which bank you have your salary account with. Some banks offer you unlimited free transactions while others offer a fixed number, after which they charge a transaction fee.
What kind of loans can I avail through my salary account?
You can apply for a variety of loans, including:
- Personal loan
- Car loan
- Home loan
However, an employee, you must have a certain minimum income with a stable employment history to get a loan.
