People often have more than one bank account. Some people keep it for their needs, while others use just two or three accounts. Opening accounts has become easier, especially since the banking sector has gone digital.
You can open savings accounts online or through mobile apps in the comfort of your home. You can also apply online, complete the KYC video and open your account in minutes. There are advantages and disadvantages to having more than one savings account. We will discuss this in detail here.
Rewards and Discounts Benefits
Most banks offer features like lockers, insurance, premium debit cards and other privileges that you can use. In addition, the account holder also gets rewards and discounts on utility payments, purchases, and EMI payments. So by maintaining multiple accounts, you can maximize your savings. Most banks offer further discounts on a special sale or purchase.
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Withdrawal Limit Waiver
The number of free ATM withdrawals per month by banks has been limited. Multiple accounts allow you to transact with many other ATMs and save on transaction fees. This is especially beneficial for frequent ATM users.
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Account for special tasks
Many people put money into multiple savings accounts for goals like foreign travel, car purchases, and higher education. For some family members, just open a joint account for everyday expenses. Many people also keep separate accounts in the form of contingency or emergency funds.
Bank partner offer
Various e-commerce and online portals enter into agreements with banks to offer special offers and promotions to their customers. You can take advantage of such offers with multiple accounts in different banks.
The Deposit Insurance and Credit Guarantee Corporation, a subsidiary of the Reserve Bank of India, insures up to Rs 5 lakhs in the bank. When a bank fails to pay an amount to a customer, the corporation covers the amount held by the account holder.
If your deposit is more than Rs 5 lakh, it can be dangerous to keep all the money in one bank. Depositing funds with different banks will ensure that each bank gets separate insurance coverage. In case of default, the bank can use such accounts as backup in case of main account.
These are the disadvantages
There are also many disadvantages to having more than one account. It is difficult to manage multiple accounts at once. In addition, a maintenance fee is also charged on each account. Whether it’s an ATM fee or a minimum amount. These problems persist with more than one account.