1. Your Requirements
You have to list down your main banking requirements first. Here are some questions that will help you finalize your requirements -˗ Which bank does your company operate salary accounts from? It will be easier to manage money transactions from the same bank where your pay cheque is deposited.
˗ How important is online banking for you? Do you need to do all your transactions online or are you comfortable visiting the branch for your banking purposes.
˗ Are you a person who can manage a minimum credit balance criterion set by the bank? Many banks charge a fee if you cannot hold a credit balance decided by the bank on a quarterly/yearly basis. If you cannot manage it, it is best to avoid such banks.
2. Fees and Charges
Different Banks charge differently for a variety of services like -
‒ Bank Balance below the set limit
‒ Request for hard copies of bank statements
‒ Annual Fees
‒ Stop payment
‒ Issue of Bank Drafts.
‒ Number of ATM withdrawals more than a specified limit in other than your own bank's' ATMs .
Compare the fees of banks for different services that you need and choose one that suits your requirements. For example, other things being equal, if you issue many bank drafts, you should choose one that has lower fees to issue them.
Check the various facilities and services that the bank can offer and which are useful to you. You might need a demat account for investing, a locker for safekeeping or a bank which offers services for Non-Residents. Some banks offer services on your doorstep especially for senior citizens. You might want to avail of that if you are elderly or for your parents.
Senior citizens who are customers of Yes Bank get discounts in certain pathology labs, chemist shops etc.
If you travel abroad frequently, you might want access to your money from all over the world. You should check if that is available, forex services etc. and fees charged for overseas transactions.
Assess the credit card options of the bank. Nowadays credit cards come with a lot of interesting offers and tie-ups. If you travel a lot, you should consider a bank that gives you a credit card with a tie-up with an airline or travel company.
For example the IndusInd Bank Platinum Aura Credit Card has interesting features like flexible reward plans, more reward points for money spent and conversion of reward points as cash credit for outstanding payments. Some banks offer prepaid cards, prepaid forex cards, gift cards etc. Using these cards will reduce risk of carrying a lot of cash in person.
4. Offline and Online access
Are you a busy executive with erratic work hours and frequent travels that you have no time to visit your bank? If you are busy throughout the day, you should have an account with a bank that has good online banking facilities. Nowadays most banks are online but compare the services that the banks provide online. It will be helpful if you can transact online, get statements etc. with a click of few buttons. If you prefer online banking, ensure that the bank follows all security practices. You should also be aware of good practices of online banking. For example, Citibank has a good online banking framework with a user friendly interface and many features.
On the other hand, if you are not comfortable with online banking, ensure that there is a branch which you can easily access and has work timings that suits your schedule.
Assess the banking timings, quality of customer service, responsiveness to customer calls and emails to select the right bank.
5. Interest Rate and other rewards
A bank is not just for safekeeping your money and undertaking transactions. You should check out the advantages and features that it offers.
Compare interest rates on savings accounts and FDs. Yes Bank and Kotak Bank offer higher interest rates compared to many other banks. Having said that security of your hard earned money is also important. Co-operative banks also offer higher interest rates but the risks are higher as deposits are not fully insured. Rules for taking loans from co-operative banks are not stringent. So people/ organizations who do not have a great financial record also manage to get loans. If there are repayment issues, there is a risk of you losing money.
Check the offers on the debit cards given by the bank. Banks also give discounts, cash back offers etc. Choose the bank that has offers relevant for you.
Compare the other financial products that the banks offer like loans. You might want to take loans for various purposes and so it is better to be aware of interest rates, prepayment fees etc.
Some banks have special offers for women, students, senior citizens etc that you can take advantage of. For example the IDBI Bank SuperShakti (Women's) account offers two zero balance accounts for the woman's children. There are some conditional discounts available on locker services and concessions on Annual Maintenance fees of a demat account.
Hope this helps you narrow down your options if not zeroing in on one bank. You should visit the banks that you have shortlisted and also get feedback from existing or past customers to get a real perspective. Let us know how you went about selecting your bank.
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