Current Account v/s Savings Account

Savings accounts and current accounts are types of bank accounts designed for different purposes. Both these accounts come with their own unique features and there are some key differences between current account and savings account. A savings account caters to individuals who wish to save whereas a current account is for regular transactions of firms and companies. Savings accounts provide higher interest rates than current accounts. Savings accounts have a monthly transaction limit whereas there is no such limit for current accounts. The minimum balance requirement is also lower in savings accounts than current accounts.

Current vs savings account services are offered by almost every leading bank in India including, SBI, Kotak Mahindra Bank, ICICI Bank, HDFC Bank, Axis Bank, Citibank, IndusInd Bank, and so on. Continue reading below to know more about current and savings account difference in detail.


Savings Accounts

  • The main purpose of a savings account is to help you save your money while earning interest on the savings at the same time.
  • This account type allows the customer to deposit money as per their convenience.
  • A savings account can be opened by an individual alone or jointly. 
  • A savings account holder is usually required to maintain a specific amount as minimum balance every month in the account.
  • Rates of interest earned on savings accounts currently range anywhere between 2.70% to 4%. 
  • These accounts usually carry the facility of issuing cheques.

Current Accounts

  • Current accounts are best suited for regular transactions.
  • These accounts are more suited for firms, companies, businessmen, public enterprises,  and users alike.
  • Current accounts do not accrue any interest due to the fluidity they offer.
  • These accounts usually do not have a limit on the number of transactions that can be made by the user.

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Difference between Current Account and Savings Account

A savings account is different from a current account in many aspects. Following are the main difference between current and savings account:

FactorsSavings AccountCurrent Account
PurposeIt is designed to encourage & promote savingsIs designed to enable regular or frequent transactions.
Best suited for Any individual who earns a steady or regular income, such as salaried employees. This account is also ideal for people who have any short-term financial goals like a vacation, wedding, car purchase, etc.

Any individual who needs to carry out frequent money transfers such as businessmen, organizations, firms, companies, public enterprises, etc.


Limit on monthly transactionsUsually, there is a limit on the maximum number of transactions that can be done by the holder in a month. Typically, the permissible limit without any penalty varies between 3 to 5 transactions (financial and non-financial) a month .These accounts do not have any limit on the number of transactions that can be carried out by the holder.
Interest rateSavings accounts usually accrue interest rates between 2.70% to 4%. As these accounts allow limited transactions, accumulating more funds is easier over a period of time.Banks usually do not offer interest on current ac

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Current Account v/s Savings Account FAQs

What is the difference between a current account and savings account?


If you are wondering about what is the difference between current account and savings account, here is the answer:

A savings account allows you to deposit your savings with the bank while earning you interest on the same, whereas a current account enables depositing money to carry out frequent business transactions.

What minimum balance is required for saving and current account?


One of the main factors that make a saving account and current account different is the minimum balance requirement. The minimum balance requirement for savings accounts is usually low. Some banks even offer zero balance saving accounts facility, where you do not have to maintain any minimum balance. For current accounts, minimum monthly balance requirement is relatively higher and usually starts from Rs. 10,000.

What are the benefits of a current account and savings account?


Benefits of a current account:

  • Used for business purpose
  • Allows unlimited transactions
  • Prompt business transactions
  • No limit on cash withdrawals
  • No limit on deposits made in the home branch
  • Enables business owners to make direct payments via cheques, demand drafts, or pay orders.
  • Offers overdraft, internet banking, and mobile banking facilities.

Benefits of a savings account:

  • Accrues interest on the deposit amount
  • Helps in building emergency funds
  • Low minimum balance required
  • Safe way to keep your money
  • Helps in achieving financial goals
  • It is the first step for availing credit from a bank
  • Enables instant payment for purchases
  • Automates bill payments
  • Keeps track of your income for income tax purposes