How to Open a Salary Online Account with a Bank?

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In a flurry of text messages pinging on our phones, we wait for one to beep: "Your Account has been credited with XXXXX." While money can't buy happiness, this statement on payday brings a smile to everyone's face. The true happiness of opening an online salary account can be summed up by this event. 

Salary accounts are a handy way for the company to pay the employee's monthly salary. It not only simplifies the process for the business but also provides salary account benefits to the employee.

When it comes to being physically fit, your fitness trainer can often keep you motivated. Similarly, your salary account will undoubtedly keep you driven to stay financially fit. This article will walk through how to open a salary account online, the documentation required, eligibility and how to choose the best bank to open a salary account. 

Can I Open a Salary Account on My Own? 

The opening of a salary account is usually done by the employer at a bank with which the company has a relationship. It is not something that employees normally do unless the employer gives special permission. The company deposits all employee’s salaries into their salary accounts.

Employers select the kind of salary account based on which employees are granted advantages and amenities associated with their salary accounts. This account is crucial for employees as a salary account is regarded to be the most important way to accommodate your financial obligations.

How To Open A Salary Account?

When an employee joins a company, a salary account is among the first things they obtain from the employer. An application form must then be fulfilled, which is submitted by the employer to the bank. 

To open a salary account online or offline with the affiliated bank, the employee must provide their information to the same bank.

Opening a salary account with a bank is required when you’re starting a new job. The employer transfers the employee's monthly salary into this bank account at the end of every month or week as per their agreement. With the advancement of technology, some banks now allow you to open a salary account online.

What Are the Eligibility Criteria for Opening A Salary Account?

To open a salary account, you must meet certain qualifying requirements. Since you’ll be opening a salary account when you join an organisation, it’s most likely you’ll meet all the eligibility requirements, and all you’ll have to do is submit a completed application form together with the required papers.

Some banks ask applicants to submit an introduction from the firm in the format specified by the bank (stamped and signed by the authorised signatory). Furthermore, the monthly minimum net salary band differs by the bank. This also varies depending on the type of salary account provided by the relevant bank too.

What Are the Documents Required to Open a Salary Account?

To open a salary account, employees require the following documents:

  • An application form to open a salary account.
  • Proof of identity & address like:
  • PAN Card
  • Aadhaar Card
  • Voter ID Card
  • Driving Licence
  • Passport
  • An ID card issued by the Central or State Government, Public Sector Units (PSUs) and/or NREGA Job Card
  • Latest passport size photographs
  • Appointment Letter (as proof of employment with the company)

What Are the Benefits of Opening A Salary Account?

What's in it for you after all the hard work of finding a job and enjoying the fruits of your labour and toil? A salary account provides more benefits than a savings account. While the benefits and features of salary accounts vary from bank to bank, these are some of the most relevant ones: 

  • Minimum Balance: Zero

A salary account often has a zero minimum balance requirement. Because this account has no balance, people have more choice in how they manage their money. Account-holders are not subject to any penalties if their account balance remains above a specific limit.

  • Online Banking:

Salary account holders can also send and receive funds online globally through online fund transfers. This eliminates the requirement for cash withdrawals or cheque deposits to complete the fund transfer. Some banks also provide phone banking services, allowing customers to manage their accounts from the comfort of their own homes.

  • Personalised Cheque Book and Debit Card

Employees are also given an ATM card that they can use to withdraw cash from ATMs and make online and offline debit card payments. For cheque payments, account holders receive individualised cheque books.

  • Loans are readily available.

Account-holders can also get fast access to a variety of loans from banks. Having your salary account in the same bank as your bank account will make the documentation process smoother and quicker, regardless of whether you're searching for a personal loan, a vehicle loan, or a home loan. Even the interest rate for existing account holders is often more competitive.

  • Services for Investments

Salary account opening allows account holders to invest in financial schemes such as mutual funds, bonds, insurance, and more. A Demat account may also be linked to a salary account for stock investing and trading.

To sum up, opening a salary account can make routine life much easier because:

  • Compared to a savings account, opening a salary account offers more benefits.
  • The advantages of these accounts may vary depending on the bank.
  • A salary account holder will also benefit from online banking, phone banking, and transferring money online.
  • You can enjoy the benefits of a zero balance on the account, free statement, passbook and debit card.
  • People with a salary account can benefit from having a Demat account and services such as loans and credit card convenience.
  • You can also pay utility bills with a salary account.

How to Choose the Best Bank To Open a Salary Account?

While employees don’t always play a part in selecting the bank for the opening of a salary account, it is still important to understand the metrics involved. Below are a few specifications to consider before opening a salary account.

  • ATM: no fees for cash withdrawals and free access to ATMs of other banks throughout India. It's also possible to look at the specific branch's size and ATM.
  • Interest rate: You must be looking for a bank that offers an interest rate on a salary account which may vary from 2.75% to 6%. On salary accounts, several banks provide higher interest rates.
  • Security: Nowadays, the possibility of fraud and hacking is all too common. It is critical to assess banks in terms of security and cutting-edge technology.
  • Customer service: It’s recommended that you review your bank's customer service. This may include the availability of 24x7 online customer service, and quick redressal to resolution. 
  • Rewards: A few banks provide extra reward points and additionally even Personal Accident Insurance (PAI) to employees who have a salary account.
  • Credit and Debit cards: It is beneficial if a debit card or, in certain cases, a credit card comes with a salary account. This implies you may withdraw cash from ATMs and pay using your card instead of cash at various locations and retailers. There's nothing like it if the bank additionally gives special deals or discounts for the card!

In a nutshell

Although a salary account is a type of savings account, it has a few advantages and characteristics that make it more beneficial than a standard savings account. Bank features and perks can differ significantly. Businesses should carefully select a bank to guarantee that their workers receive the best advantages. Fi is one such app that offers several benefits for both types of accounts. It is simple to use with no burden of going to physical branches or enduring tiresome paperwork. 

Frequently Asked Questions:

  • Can I Open a Salary Account on My Own?

The salary account opening is usually done at a bank with which the employer has a tie-up. This is not something that employees do. 

  • What is the eligibility to open a salary account?

Each bank has its own set of qualifying requirements for opening a salary account. They vary by bank, but in general, most banks look for the following: 

  • An employed individual, as opposed to a self-employed individual, requires an account into which their monthly payment may be deposited.
  • Some banks additionally state the salary range required to open an account.
  • What Are the Documents Required to Open a Salary Account?

To open a salary account, you need an address and identity proof, passport size photograph and proof of employment. 

  • How Does a Salary Account Get Converted To a Savings Account?

If an employee's pay is not credited to their salary account for three consecutive months, their regular salary account is changed to a regular savings account.

  • What is The Minimum Balance That Needs to Be Maintained In A Salary Account?

One of the most regarded benefits of opening a salary account is that there is no requirement to maintain a minimum balance.

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