Salary accounts are a type of special savings account offered to salaried customers. It is a convenient way of paying a monthly salary to the employee from the employer. Having a salary account makes it easy for employers and provides unique services and benefits to the employee. Moreover, the employees can have seamless access to advanced mobile banking and net banking services.
To help you know more about the salary account, we have discussed the different aspects of it in detail.
Who can Open a Salary Account?
An organization (employer) must tie up with a bank to open a salary account for its employees. The salaries are transferred to the respective bank accounts of the employees per month as a lump sum amount by the employers. If the employees don’t have an existing account with the bank that their employers have a tie-up with, then the employer assists the employee in the process of opening an account with the respective bank.
Thus, any individual can open a salary account. One of the criteria to do so is the tie-up between the organization and a bank.
Benefits of a Salary Account
Let’s take a look at the benefits of having a salary account-
1. As compared to the savings account, the salary account offers more benefits
2. Salary accounts are more profitable to the bank as it receives a fixed amount of money per month. This makes it a fixed source of current account savings account (CASA).
3. The benefits offered by these accounts may vary from bank to bank.
4. An individual can avail the benefit of zero minimum balance in the account, free passbook/cheque book/e-statement, debit card.
5. The salary account holder can also avail of the benefits of advanced seamless phone banking, net banking and online fund transfer services.
6. With a salary account, the individuals can get the advantage of a Demat account/ services, loan convenience, credit card, etc.
7. One can also make utility bill payments through the salary account.
Difference Between Salary Account and Savings Account
Even though the salary account is a type of savings account, there are certain differences between the two. Let’s take a look at them-
|Salary Account||Savings Account|
|Only an employer can open a salary account||Any eligible individual can open a savings account|
|These are zero balance account||One needs to maintain a minimum balance on a monthly/quarterly basis|
|More benefits are offered to the account holders||Benefits offered generally have a fee attached|
|Main purpose- monthly credit of salary||Main purpose- encouraging savings|
Benefits Offered by Paytm Salary Account
Paytm payments bank offers a corporate salary account with no account opening charges or minimum balance requirements. Let’s take a look at the benefits offered by the Paytm salary account-
- Offers hassle-free process and swift onboarding of employees with instant account opening.
- Provides the benefit of a lifetime free account to the employees.
- No account opening fees are applicable.
- The employees can enjoy the benefit of free transactions and no minimum balance.
- The employees can enjoy free virtual and physical debit cards.
- The employees can earn up to 6% interest applicable on the fixed deposit
Conversion of the Accounts
In case the salary is not credited in the salary account for the three successive months, then the regular salary account of an employee is converted to a regular savings account. Thus, all the benefits and facilities related to the same account are converted to that of a regular savings account.
Contrary to this, if an individual joins an organization with a salary account linked with the bank in which he/she already holds a savings account, then the organization requests the bank to convert it to a salary account.
Along with the monthly salary credited in the account, the individuals can use the account to deposit cash or cheque in it, withdraw funds, or transfer funds to and from the account.
Wrapping it Up!
Even though salary accounts are a type of savings account, some of the features and benefits make it profitable as compared to the savings account. Thus, make sure you compare the features and benefits of both the account and convert or close the account accordingly.