Saving Account Interest Rates

Savings account is a secure and one of the most popular investments. Most banks in India offer savings accounts. Savings accounts interest rates are attractive. Interest on savings bank account is calculated on a daily basis and are credited in a periodic manner.


Top Banks Savings Account Interest Rates Comparison

Below is the table of bank savings account interest rate of various banks to help you compare savings account interest rates:

BankSaving Interest Rates
Axis Bank Savings Account3% - 4%
HDFC Savings Account3% - 3.50%
ICICI Savings Account3% - 3.50%
IDFC FIRST Bank Savings Account Up to 5%
Kotak Mahindra Bank Savings Account3.50%
PNB Saving Account 2.80% - 2.90%
SBI Savings Account2.70% - 2.75%
Bank of India Saving Account Interest Rate2.90%
Union Bank Saving Account 3% - 3.50%
Yes Bank Savings Account 4% - 5.25%

Key Highlights of Saving Account interest rates

  • Saving account interest rate varies from 2.70% to 5.25% p.a. based on daily balance.
  • Saving accounts help you fulfill your short-term financial goals.
  • You can opt for hassle-free withdrawals.
  • These accounts enable investment with minimum cash.
  • You can use saving account interest rate calculator to calculate the interest amount instantly. 

Benefits of Savings Account

Following are some attractive benefits of opening a savings account:

  • You can be assured about the security of your money when you deposit it in a savings account. 
  • You have 24X7 access to the money deposited in a savings account. The deposited money can be withdrawn from your bank or using the debit card without any hassles during any financial emergency without having to pay any penalty.
  • You can start investing in a savings account with minimum cash. You just need to open a savings account with the minimum deposit amount required by the bank and start depositing funds whenever possible.
  • You can use the savings bank interest calculator to know how much interest on savings account you can earn.
  • A savings account also gives you access to internet banking and phone banking that enable quick and hassle-free transactions. 
  • You can easily transfer funds instantly using NEFT/IMPS/RTGS, pay utility bills online, check account balance and transaction history, link credit card accounts to savings account, and do much more with the Internet Banking facility.
  • Some banks also offer personal insurance benefits on opening a savings account.

Additional Info: Check Top Zero Balance Savings Account in 2022.

TDS on Savings Account

The bank account interest amount accumulated on a savings account is considered as “Income from Other Sources” and must be filed for Income Tax Returns. However, TDS is not applicable on a savings account according to the Section 194 A of Income Tax Act. Saving deposit rate amount above Rs. 10,000 will be taxed on marginal tax rate of the account holder. Interest from a savings account is considered as a deduction and not an exemption. The deduction is permitted for interest income up to Rs. 10, 000 only and that is why, you must open a savings account in a recognized private bank, public bank or with the post office.

Savings Account Interest Calculator

You can use a Savings Account Interest Calculator to check the interest you can get from your savings account. In this Calculator, you will have to enter some basic information such as average balance and saving deposit interest rate applied by the bank. Also, you will have to select if the sb account interest will be credited on a monthly, quarterly, half yearly or yearly basis to your account. The calculator will instantly provide the savings account return amount that you will get for the daily balance as well as the savings account interest rate.

Highest Interest Savings Account

Following are the top 5 banks that offer highest saving account interest rate in India:

BanksInterestMinimum Balance
Yes Bank4% - 5.25%Rs. 10,000
IDFC FIRST BankUp to 5%Rs. 10,000
Axis Bank3% - 4%Nil
ICICI Bank3% - 3.50%Rs. 2,000 - Rs. 10,000
HDFC Bank3% - 3.50%Rs. 2,500 - Rs. 10,000

Saving Account interest rates FAQs

Is savings account interest taxable?


Yes, saving bank interest amount above Rs. 10, 000 will be taxed at a marginal tax rate of the concerned account holder. 

Which bank pays the most interest on a savings account?


Yes Bank pays the highest current bank account interest rates, i.e. 4% to 5.25% p.a. 

What is the current savings account interest rate?


Current savings account interest rates vary from 2.70% to 5.25% p.a. 

How do I avoid tax on savings account interest?


You can avail up to Rs. 10,000 deduction on the total accumulated bank savings interest rates amount under Section 80TTA of the Income Tax Act. This TDS on savings bank interest is available to an Individual and HUF. In case your total savings account interest income is less than Rs. 10,000, you do not have to pay any tax on it.

How banks calculate interest on savings accounts?


If you are wondering how banks calculate interest on savings account, here is the answer. The savings interest rates are calculated every day depending on the account holder’s closing balance, as per the new RBI regulation. If you wonder how to calculate interest on savings account, you can use saving account interest calculator to know how much the bank pays interest on your savings account. As per Reserve Bank of India regulations, the interest credited by bank to depositors' accounts on a quarterly basis. However, effective from July 1 2021, they are free to credit it on a monthly basis.

How to calculate SBI savings account interest?


You can use the SBI saving account interest rate calculator to know the interest amount you can earn on an SBI savings account. Savings account interest calculator SBI is available online for free.