Equity Funds – The Features And Benefits Of Investing In This Mutual Fund

If you like to invest in the share market, there is a good chance that at one point or another; you would have invested in mutual funds. Mutual funds allow you to diversify your investment portfolio and also help you earn additional income. An equity fund is one such mutual fund that is best known as a ‘high-risk high-reward fund’. This fund provides capital appreciation over various investment tenures – short, medium and long. Here are the main features and benefits of investing in equity based mutual funds.

1. Equity based funds are regulated by SEBI

The Securities and Exchange Board of India or SEBI serves as the chief regulator of all types of mutual fund investments, including equity linked mutual funds. This regulatory body has mandated all fund houses to disclose their month-end portfolios on their respective websites, while also mentioning the periodic expense ratios and net Asset Value or NAV daily. This backing by SEBI makes your investment safe. Furthermore, you can get this information on investment advisory platforms, which provide portfolio analysis and performance reports, enabling you, the investor to make informed decisions.

2. You can diversify your investment portfolio

There are several different types of equity mutual funds in which you can invest. The categorisation of these funds is done on the basis of market capitalisation, themes, sectors, and the investment style of the fund manager. This diverse characteristic of the fund allows you, to choose from different funds to invest in. Diversifying your investment portfolio also allows you to mitigate the risks associated with investing in a single fund.

3. You can invest in lump sum or through SIP

One of the most prominent features of equity mutual funds is that investments can be done in lump sums. It is just as easy to invest through a Systematic Investment Plan or SIP. SIPs are ideal for young investors who cannot afford to invest large sums of money, in one shot. Moreover, these investments inculcate discipline when it comes to investments, since you have to invest a fix amount each month. In fact, you can invest as little as ₹500 per month through SIP.

4. The fund is managed by professional fund managers

The great thing about investing in equity oriented funds is that you do not have to do any research or analysis before investing. These funds are managed by professional fund managers with years of experience under their belts. Such managers can predict market movements and are well aware of how it functions. As such, buying and selling decisions are taken by fund managers, so that your investment objectives and financial goals may be achieved.

5. Equity based funds are tax efficient

Equity funds are also known to be some of the most tax-efficient funds. When you invest in this mutual fund, you do not have to worry about paying capital gains taxes to your fund house, irrespective of how often fund units are purchased or sold by fund managers. You can simply pay the capital gains tax on an individual level.
Final word: Equity savings schemes are widely considered as risky investments so you must assess your risk appetites and your preferred investment tenures before investing. However, investing in equity based funds can prove to be highly beneficial. Just ensure make informed investment decisions. Remember to check the reputation of the fund manager as this individual holds the key to your investment. A good manager can indeed help you earn high returns on your investments.

How to Open Savings Bank Account both Online & Offline

Opening a savings account is always a good idea as it keeps your excess money safe, especially the ones which are not required for immediate use. Besides, opening a saving account helps to encourage saving money for the future. From a schoolchild to a senior citizen, anyone can open a savings bank account with a bank or any financial institution. It is on you to choose which bank you need to open an account with.
Features of having a savings account 

• Helps to promote savings
• No restrictions on the number of deposits
• Can withdraw either by a cheque or withdrawal slip. The facility has been made easier withdrawing using an ATM card.
• There is no validity period for a saving account.
• There should be a minimum amount for opening the account. Also, a minimum balance should be maintained based on which you earn interest. But these days, there are new banks that offer zero balance saving account, which comes with no maintenance of account balance.
• An online facility like mobile banking app is available for managing your savings account. With this, you can make any bill payment or fund transfers or pay household expenses. 

How to Open a Savings Account Offline
Due to the emergence of mobile banking and online facilities, it is much easier for the customer to open a savings account. But the high traffic or network issue creates server problems which at times becomes challenging for customers to complete the process. Also, who are not so tech-savvy, can follow the mentioned offsite steps –

• Research – Before opening an account, conduct proper research about banks and their interest rates. Select the one which fits your needs and offers high-interest rates.
• Documentation – For opening an account on savings, you need to bring a copy of your identity proof, two passport size photographs, address proof, income or employment proof (if required), and age proof to your nearest branch of the bank.
• Opening form – When you visit the bank, the representative takes care of the process. They provide you with an account opening form, which needs to be filled thoroughly. Submit the form with the copies of documents to the representative.
• Processing time – They then process the form. Based on the bank, the processing gets cleared and opened within one to 12 working days. 

Online Savings Account Opening – Steps to Follow
Online saving account opening is the best option and possible through online banking apps. It takes minutes and involves a hassle-free process.

• After researching different banks and their interest rates, choose the best one that fits your requirements.
• Log on to the respective bank website in which you wish to open an account. Not all bank accounts have an online bank account opening with zero balance.
• Fill in the online form, upload documents such as ID and address proofs.
• The back-end team of the bank verifies them, and you can begin operating the account within hours. 

Final verdict:
The best thing about saving account is there is one for every requirement.

Facilities Available to NRI Account Holders

The Chief regulatory bank in India, the Reserve Bank of India, is constantly creating means and ways to make banking more and more convenient for bank account holders. The NRI banking category is also extended a wide range of benefits and facilities that makes it easy for Non-Resident Indians to manage their funds, in both, their Non-Resident Ordinary Rupee (NRE) as well as their Non-Resident External Rupee accounts (NRE). Here are the facilities you can get with your NRI bank account.

1. Internet Banking facilities

NRI internet banking is one of the most basic facilities you can get with your NRE and NRO savings accounts. This is the most important and fundamental facilities available to NRI bank account holders because it can help them easily manage their bank accounts in India while residing in a country, thousands of miles away. With the click of a few buttons, you can order cheque books and bank debit and credit cards, create fixed deposits, make market investments and assign nominees and so on and forth through the internet banking facility.

2. Fund transfer facilities

Banks recognise that Indian residents may be based in any country across the globe and may still have financial obligations towards their family or businesses in India. This is why NRI banking services also entails easy and quick fund transfer facilities. You can easily send funds from your NRI bank accounts to regular as well as other NRI accounts through net banking. Typically, you can transfer sums of various international currencies such as EUR, GBP, JPY and different dollar currencies like USD, AUD, CAD, and SGD into NRI bank accounts. Apart from net banking, sums can be transferred through different mediums such as Western Union Money Transfer, Money Gram and Xpress Money, to name a few. However, you need to check if your bank provides these money transfer services. Thanks to digital banking, funds are credited into the beneficiaries’ accounts within just a few hours.

3. Loan and overdraft facilities

Say you wish to purchase a car or a home in the foreign country you are based in, but are in need of a loan to facilitate the purchase. You can easily apply for a loan against the sums parked in your NRI bank accounts. If you have a fixed deposit with your bank, you can also apply for overdraft services. Moreover, applying for the loan or overdraft facilities does not include robust documentation or application processes. You can do it easily through the already available NRI online banking facility.

4. Depository services facility

If you find the Indian investment market more profitable than the investment market of the country you are living in, you can always avail the depository services facilities offered with your NRI bank account. Banks provide depository facilities which make it possible for you to invest in mutual funds, shares, government bonds and different kinds of money market instruments available in India. Once again, you can use your NRI net banking account to make your investments.

5. FCNR facilities

Once you’ve saved enough money, you can also think of utilising the FCNR NRI services provided by banks. You can create a fixed deposit in foreign denominations without worrying about currency fluctuations. The applicable FD interest rate applies throughout the FCNR deposit tenure and you don’t stand to incur a loss even if the price of the foreign currency falls upon maturity.

Final word: So, if you are planning to move abroad, ensure you open your NRI banking account before moving. Some banks also allow you to open the account online through digital banking.

4 Advantages of Investing in Equity Funds

The investment market is full of opportunities. Investors can choose from a wide range of securities that can help them reach their financial goals over specific investment horizons. For most investors, mutual funds remain their preferred investment instruments. Among the various kinds of mutual funds available in the investment market, equity mutual funds are a popular choice. These funds typically aim to generate higher returns for investors. The fund manager invests in shares of companies with different market capitalisation. Here are 4 advantages of investing in equity based funds.

1. Equity based funds are professionally managed

When it comes to share market investments, it is best to invest in securities managed by experts in the field. The great thing about equity linked mutual funds is that they are managed by professional fund managers who know the ins-and-outs of the investment market. Such managers study the market on a daily basis and make investments by predicting market fluctuations. They also refer to real-time data as well as past-performance reports of funds before making any investment decisions. As such, you can rest assured that your money is in safe hands when a fund is managed by a reputed, professional fund manager.

2. Investing in equities can lead to capital appreciation

One of the most basic reasons why investors prefer to invest in equity linked mutual funds is that it has the potential to appreciate the capital invested. An equity based fund is one of those rare funds that provide returns that can help beat inflation. As it always happens in the stock market, if the price of the stock rises, it automatically results in capital appreciation. If you make well-informed investment decisions over a good period of time, you can truly create a good corpus over time, by strategically investing in equity based funds.

3. You can benefit from portfolio diversification

A diversified investment portfolio is crucial if you wish to mitigate the risks associated with share market investments. This is a great benefit you can get form investing in equity savings schemes. By investing in equity based funds, you can spread your investments over in different sectors, which can help reduce the risks associated with losses on investments in future. In the event of market volatility and under-performance; those stocks that are out-performing can make of for losses incurred by the under-performers. This helps minimise market risks and losses on your overall investment portfolio.

4. You can liquidate your investments whenever you like

The great advantage of investing in mutual funds is that they can be liquidated easily. Since equity oriented funds fall in the general category of mutual funds, this liquidity benefit is associated with them as well. You can easily get back your corpus in your savings bank account when you invest in equity based funds. It is possible to redeem the fund (partially or completely) at any given time; especially when you find yourself facing a financial emergency. Moreover, you can invest in these funds through SIPs, which you can stop anytime. Pre-term investments are credited to your account in a week whereas matured funds are deposited within 3 days.

Final word: Equity funds produce higher and better returns than both, fixed deposits and debt funds. However, the returns earned by investors, largely depends on the performance of the company. Since these funds have the ability to provide higher returns, most investors, prefer investing in them. However, equity based funds are ideal for investors with medium-to-high investment appetites. If you consider yourself a conservative investor, you should stick to investing in debt based mutual funds.

Essential Facts About NRE Accounts That You Need to Know

As an Indian moving abroad, you need to open an NRI account. The right account can help you manage your savings in India as well as those earned in the foreign country you have moved to. You can choose between two types of NRI bank accounts – NRE and NRO savings accounts. Both accounts come with their own set of benefits and you can open either of these accounts or both of them. In this article, we have highlighted some essential facts about NRE bank accounts. Read on.

NRE account meaning and purpose
A Non-Resident External Rupee or NRE savings account is a special type of account designed for NRIs. This is a foreign currency account. This simply means that you can deposit different types of foreign currencies that are authorised by the Reserve Bank of India. However, since this is essentially an Indian account, the foreign currency parked into the account is immediately converted into INR. The bank applies the currency conversion rate of the specific day on which the sums are deposited into the account.

Eligibility criteria for Opening the account
In order to open an NRE savings account you should be either of the following:

• A Resident Indian Citizen moving abroad
• An NRI or a PIO (Person of Indian Origin), as per the FEMA definition
• A seafarer of Indian origin or nationality, who is employed by an overseas shipping company
• A Government Employee from India, holding a diplomat passport
• An Indian student pursuing higher education in a foreign country

Note that if you are an Indian citizen currently residing in countries like Bangladesh, Nepal, or Pakistan, you need to get prior approval from the RBI to open any NRI bank account.

Currencies you can deposit
You can deposit a wide range of currencies in your NRE savings account. Earlier the RBI allowed NRIs to only park basic currencies such as American Dollars, Euros, Great Britain Pound Sterling and Japanese Yen. However, today, NRI can deposit several other currencies which include Australian Dollars, Canadian Dollars, New Zealand Dollars, Singapore Dollars, Swiss Francs, Swedish Krona and Danish Krone.

Different types of account you can open
The accounts you can open as an NRI are more or less similar to those that you can open as a resident Indian bank account holder. For instance, you can open both, savings as well as current NRE accounts. You may also open a recurring deposit, in which you can deposit a fixed sum of a particular foreign currency, although this facility is not provided by all banks. Similarly, you can open a fixed deposit account, widely known as a Foreign Currency Non-Repatriable Account Deposit or FCNR deposit. However, in case of NRI bank accounts, there is no provision for salary or zero balance accounts. In case, you may need to maintain an average amount of ₹75,000 or its equivalent in foreign currencies.

Repatriation
All NRE accounts are fully repartaible accounts. This means that you can freely and fully repatriate both, the principal amount deposited as well as the interest earned on deposits.

Final word: NRE bank accounts can be opened jointly, but only with another NRI, who may serve as your Power of Attorney. Some banks allow you to open NRE accounts online. An NRE bank account can prove incredibly beneficial if you move to a foreign country where the value of the currency is higher than INR. For instance; a saving of USD $200 converts to over ₹14,000, at today’s currency conversion rates. This accounts for a huge saving and can help you create a corpus at a much faster rate.

Factors To Consider While Installing A Mobile Banking App

Usage of mobile banking apps is growing as it provides ease, flexibility, and speed while processing the transactions. Most of the people in India are doing away with traditional banking and adopting online banking.

Almost every private sector banks and PSU banks have a mobile banking app to do banking transactions on the go. It removes the requirement for a computer, laptop and physical visit to the bank to do banking transactions. Once you install the app on your smartphone, you can carry out all banking transactions as per your convenience.

Consider the following factors while installing mobile banking apps –

Simple to use

One of the factors to consider while evaluating a mobile net banking app that it should be simple to use. They should be user-friendly and easy to use. The navigation must be uncomplicated and have concise labelling.

Secure

Security should be on the list while assessing mobile banking apps. They must have security with two-factor authentication. If possible, banking app should run biometric authentication.

Multiple payment alternatives

The best app should have various payment options such as NEFT, IMPS, BHIM UPI payment, and QR code payment. It facilitates payment using the mobile app quickly.

Conventional facilities

Mobile app should offer conventional banking facilities such as card block, cheque book request,  PIN generation, balance inquiry, ATM card issue etc.

Biller details

The app should have a feature of biller registration and remembering biller or beneficiary details while doing a transaction. All transactions via the app should be smooth and free.

Track finance

The app should have the feature to let you track your finances effectively. It is advantageous if the app gives a dashboard view showing your income and expenses.

Notification and alerts

All alerts and notification must get promptly updated in the mobile notification centre. The mobile app should have a facility to turn off notifications.

Suggestions for using the app:

Using mobile banking app provides ease and convenience, however, it has its own security risks. If you are using an online banking app here are few ways that will surely help to secure yourself from threats –

Update your mobile banking app

Always have an updated version of the app with new features, bug fixes and security fixes. You should keep it updated as and when new version is available in the market. It is a good idea to give the app permission to install the latest updates automatically.

Do not use a public Wi-Fi network

The public Wi-Fi network is risky as it might be infected with a hidden virus that can access valuable information from your device. Thus, use public Wi-Fi network while accessing mobile net banking.

Avoid storing or sharing your login credential

Avoid storing or sharing your login credentials such as username, password or pin in the handset. Saving login details while logging to the app is a big no. It will lead to significant security threats.

Use of biometric

It is sensible to make use of biometric login security. It assists in securing the mobile banking app from being misused.

Clear data regularly

Ensure to clear data stored in the application regularly. It will prevent leakage of sensitive information. However, once you clear data, it will also remove the settings for the application, and ask you to reset all settings.

Do not save sensitive information

You should not keep any confidential information in your banking apps such as credit card or debit card details, CVV or net banking password in your mobile app.

NRI Banking - The Essential Facts You Should Be Aware Of

Today, most Indian banks offers special NRI banking services to their customers living in foreign countries. Non Resident Indians or NRIs can choose between two basic NRI bank accounts –NRE accounts and NRO accounts. These accounts make it easy for you to manage your savings seamlessly and conveniently. However, since all NRI bank accounts come with their own set of features and benefits, here are some essential facts about NRI accounts that you should be aware of.

Types of accounts you can open
As an NRI, you have the option to open 4 major types of NRI banking accounts. These are:

• Non-Resident External Rupee or NRE accounts
• Non-Resident Ordinary Rupee or NRO accounts
• Foreign Currency Non-Resident Bank Deposits or FCNR accounts
• Resident Foreign Currency Accounts or RFC accounts.

Basic features of the accounts you can open
Before you open any of these NRI banking accounts you should consider your requirements.

• You would require an NRE account if you wish to park your savings in foreign currencies. The funds parked in NRE accounts and the interest earned on it is freely and fully repatriable.
• If you are living abroad but have investments and sources of income in India, you will need an account in which you can park your savings in INR. In such a case, you should open an NRO savings account. For NRO accounts, you can only repatriate the interest earned on savings, as per RBI limitations. Also, you have to pay TDS on the savings parked in the account.
• If you have enough savings in foreign currencies, you can open an FCNR deposit and earn good interest rates on it, without worrying about currency fluctuations.
• If you wish to return to India at a later date and park your foreign currency savings in it, you can open an RFC account in order to eliminate the risks associated with currency fluctuations.

Opening the account
As a part of NRI services, most prominent banks in India allow their customers to open NRI bank accounts online. You can simply visit your preferred bank’s website, select the type of account you wish to open, fill a form and attach the documents. Some banks may even ask you to provide proof of your NRI status, which you can get from the Indian Embassy of the country you are living in. You can even open this account by visiting your preferred bank with the necessary documents, whenever you visit India. While these services are offered by most banks, you should check if the bank has RBI authorisation and the necessary license for dealing in foreign currencies. You can open this account irrespective of the foreign country in which you are residing.

Services available
As an NRI, you can easily park your foreign earnings in any of the above mentioned NRI bank accounts and conduct a wide range of transactions. Like with most bank accounts, you get NRI internet banking services, which helps you conduct a wide range of online transactions.  For instance, you can easily send money to your family in India or make fixed deposits out of your savings by utilising the internet banking facility provided with your account. You can seamlessly transfer funds from one account to another and pay for your expenses in India or abroad through your net banking account.

In conclusion, you must consider your requirements and the type of services available before you open any of the above mentioned accounts. Ensure you select a bank offering NRI banking services so that you can easily conduct a wide range of transactions from any corner of the world.

4 Reasons Why You Should Open An NRI Banking Account

Banking has become rather convenient today, whether you are a resident Indian or a Non-Resident Indian (NRI) living abroad. Today, you can access your bank account over your mobile phone screen or your desktop/laptop computer within seconds. Whether you want to open a savings, current or NRI banking account, you can do it all online. Not only this, you can even transfer funds easily. As an NRI, you can open NRE and NRO accounts and FCNR deposits, depending upon your requirement. Once these accounts are opened, you can access your funds from any corner of the world, rather easily. So if you are an Indian living abroad, here are 4 reasons why you should open an NRI bank account.

1. You can easily repatriate funds

As mentioned above, you can open Non-Resident Rupee External (NRE) and Non-Resident Rupee Ordinary (NRO) bank accounts as an NRI. Both these NRI banking accounts allow you to easily repatriate the funds parked in them. Just like a traditional bank account, you earn interest on your savings parked in NRE account, and both, the sums parked and the interest you earn on it; is freely and fully repatriable. In case of NRO accounts, you can repatriate the sums parked, but you need to pay the applicable taxes before doing so.

2. You do not need to maintain higher balances

Most banks offering NRI bank accounts in India have significantly reduced the mandatory minimum balance maintenance requirement. Just like a basic savings account, you do not need to maintain more than ₹10,000 as the monthly minimum balance in your NRI account. This proves extremely beneficial if you are earning sums in a currency that holds a higher value than INR. For instance, if you are earning in USD, your minimum deposit can be as low as approximately USD $150.

3. You get access to internet banking services

Just like with your regular savings and current accounts, you also get NRI net banking services. This way, you can easily send money to and receive money from your family in India. You can also open both, NRE and NRO accounts and transfer funds between the two types of accounts easily. Moreover, you can also maintain a foreign currency fixed deposits using the sums parked in NRE and NRO accounts and open these FDs via your internet banking enabled NRI account.

4. You can avail tax benefits

Opening both, NRE and NRO bank accounts come with their own set of advantages, with tax benefits being the most prominent reason why you need this account. However, you need to research about the various types of NRI banking services and accounts before you open one – especially the aspect related to tax benefits. The interest earned on your savings parked in NRE accounts and FCNR deposits accounts is tax-free in India, but you have to pay TDS (Tax Deduction at Source) on your NRO account savings as per the Income Tax rules in India. You also have to pay a small amount as tax if your wish to transfer funds from your NRO account to any NRE account.
Final Word: As is apparent, there are several advantages of opening your NRI bank account. From NRI internet banking services, to easy repatriability and opening accounts online, everything is possible. Modern day NRIs can easily and conveniently complete their banking transactions within seconds from anywhere in the world. You can easily send money to your loved ones, transfer funds from one account to another and even withdraw funds from these accounts whenever you need.

Protocols To Keep In Mind To Ensure Safe Online Banking

With the Indian e-commerce space expanding due to constant spree of acquisitions, more and more Indian customers are moving away from traditional way of shopping at stores to shopping online. This, along with demonetisation has led to a swift rise in the number of digital mode of payments in recent years. These include numerous forms of payments, such as net banking, debit/credit cards, mobile wallets, UPI, etc. This also calls for an increasing requirement of recognising on how to safeguard online payments.

While technology has made it simple for us to manage our daily expenses, every great innovation has drawbacks too. This wave of digital payments has also opened doors to risks of cyber theft as new users, and the less tech-savvy do not take all the adequate safety measures while using internet banking.

Lot of us tend to save personal financial information on various digital payment platforms for quicker payments. While it does make our lives easier, it also causes a severe security threat.

While doing transactions online, we are subject to various risks of scams such as – loss of money and financial data, phishing scams and identity theft. Since most of us now use net banking to make online payments, one must take safety measures to protect money, both offline and online.

Here are few rules to follow to ensure safety while indulging in financial transactions on the internet:

Secure website

Anybody can go through your letters from the mailbox outside your house. Similarly, anybody can sniff around your internet connection too, if logged into an unsecured website. And if someone scrutinises your connection for a long time, they can gain access to any data that you send and receive or have stored on that site.

For preventing this violation of security, most social networks, email services, etc. use a safe and secure protocol, called HTTPS. This security protocol is known as Hyper-Text Transfer Protocol over Transport Layer Security or HTTPS.  It means end-to-end encryption of any data that’s exchanged between website servers and you.

The easiest way to identify if the website is safe is to look for a green padlock icon in the left corner of the address bar. Also, look if it is “HTTPS” at the beginning of the URL in the address bar and not “HTTP”.

Dedicated email address

If you are a regular online shopper, it is ideal to create a separate email address just for online shopping. Keep this email account clean and uncluttered. This way if you receive any unsecure email, on your main ID, with dubious promotion offers, you can spot them right away.

Payment alert messages

In case, you do not have the SMS alerts facility active, we advise you should get it as soon as possible. The SMS alert facility will inform you of any bank account activity. Hence if any transaction does not get initiated, report to the bank immediately and cancel all your cards. If informed on time, your money is safe, and the bank will compensate you for losses, if any, as per RBI guidelines.

Avoid public computers and Wi-Fi

Never do any online banking transactions on a public computer such as the ones in cybercafé. Also, never use public Wi-Fi for financial transactions as they are unsecured networks. Anyone can join the network as there is no key or password to access it. Such networks can easily fall prey to hackers who can steal your details.

Remember these protocols while using your mobile banking apps as well.

Do You Know These 4 Facts About FCNR Deposits?

In order to create a corpus, one needs a good amount of savings and investments. You can put away your money in bank fixed and recurring deposits or even invest in the share market. The idea is to plan your investments in such a way that you can accrue high returns and also liquefy the investment if and when needed. If you are a conservative investor, preferring to park your savings securely, a fixed deposit is the best way to go. NRIs, too, can make FDs out of their foreign currency earnings. Yes, you can open a Foreign Currency Non-Repatriable deposit or FCNR deposit. But do you know these 4 essential facts about this foreign currency deposit? Here’s all you need to know

1. FCNR is not exactly an account, but a fixed deposit

Most NRIs generally assume that FCNR is an account, but the fact is that it is a deposit. As an NRI, you can open a Non Resident External Rupee of NRE account and/or an NON Resident Ordinary Rupee or NRO account. You can deposit foreign currencies in the former account and Indian Rupees in the later. Once you have a good amount of savings in the NRE account, you can make a fixed deposit from it. These FDs could be termed as NRE fixed deposits, a term used interchangeably with foreign currency deposits.

2. You can maintain deposits in different major currencies

Most banks allow you to maintain your fixed deposit in different, major international currencies. Generally, the currencies in which you can maintain your FCNR deposits include Great Britain Pound Sterling, Euros, Japanese Yen, Swiss Francs, Danish Krone and Swedish Krona. You can also maintain the FD in different types of dollars which include American, Australian, New Zealand, Canadian and Singaporean Dollars.

3. You should know the minimum and maximum tenure and the penalties for premature withdrawals

Fixed Deposit for NRI can be opened for a minimum duration of 1 year, whereas the maximum FD tenure is generally 5 years. A handful of banks may also offer 10 year tenures for foreign currency fixed deposits. The greatest advantage of these deposits is that they are risk averse and you do not have to worry about currency fluctuations. Also, the interest you earn on these FDs is in the foreign currency in which the FD is maintained. You may also prematurely withdraw your FD before your chosen tenure ends, but you have to bear a penalty for premature withdrawals. If you decide to break your fixed deposit, before the minimum 1 year tenure, you may not be eligible to earn any interest pay out on your deposit.

4. You can open the deposit online

As an NRI, it may not be possible for you to visit your bank in India and create a fixed deposit account. This is why all banks offering NRI services, allow you to make your NRI fixed deposit online. That said the main source account for the foreign currency fixed deposit should be a foreign currency account opened overseas or an NRE account in India. You can easily create the FD by transferring funds from either of the bank account through wire transfers. You may also create this FD while you are in India by depositing a travellers’ cheque or make foreign currency cash deposits.
As is apparent from the term FCNR, this is a non-repatriable deposit. That said, you can completely repatriate the principal amount of the fixed deposit and the interest earned on it, when your FD matures. You also earn interest on a half-yearly basis on these deposits.

Why Is Zero-Balance Savings Account Popular?

When you visit a bank to open an account, you have numerous options to choose from. For choosing an account that best suits your needs, you must first understand the concepts behind each one of them and be aware of their underlying differences.

Zero-balance savings account
A zero-balance saving account offers you the facility to open an account with no need of minimum balance at the time of opening an account. Usually provided by major banks, zero-balance savings account assists you to withdraw money as and when required, thus addressing your liquidity needs.
In most cases, the account offers additional facilities such as ATM cum debit card, mobile banking, internet banking, and online money transfer.

This saving account is given to the class of customers such as salary account holders and under the Pradhan Mantri Jan Dhan Yojana. PMJDY is a scheme with the aim of financial inclusion.

Features of zero-balance account

• No restrictions on maintaining a regular monthly balance.
• No charges levied on the debit card or ATM card.
• Free passbook issued at the time of opening the account.
• Free net banking facility to account holders.
• Offers unique benefits for salary account holders based on the businesses

Difference between Zero balance savings account and regular savings account
Generally, you must keep a minimum Monthly Average Balance (MAB) in your regular savings account. If it is challenging to maintain the minimum required balance in your account, non-maintenance charges will be levied

Documents required:
For opening the zero-balance saving account, you just must submit the necessary KYC documents like identity and residence proof.

Other benefits of zero balance savings account
High-interest rates: When you open zero-balance savings account online, the interest rates are higher than the manual option. Although no minimum balance is considered for this purpose, the online route has more advantages.

Easy to open: Your PAN and Aadhaar are enough to open zero-balance account. You need to set a PIN then and start using the account. The welcome kit will also contain chequebook and a debit card which is integrated with the mobile banking apps.

No KYC balance up to INR 1 lakh: Such accounts allow you to maintain a certain amount of funds, especially for new holders. The maximum permitted balance by banks is INR 1 lakh.

Transaction charges: One of the many perks is zero transaction costs. If you wish to withdraw or deposit some funds, do not worry about deduction or transaction costs. Mobile banking apps need a unique authentication password known as mPIN for authenticating payments and transactions.

Shopping and entertainment: These are two areas of life that no one wants to comprise on. The virtual debit card enables you to pay for your favourite product at all the sales terminals.

Benefits of savings account opened under PMJDY

• Not required to keep a minimum balance.
• Interest on deposits as per current bank rates.
• Accident-insurance cover of Rs. 1 lakh.
• Direct transfer from government schemes is credited in the account.
• Your have overdraft facility also available for 6 months.

How To Educate Children About Money Management?

If you are tired of always using ‘no money' excuse to deny a toy to your kid, then perhaps it is time to educate your child about the importance of money and spending it wisely. By teaching your child about the importance of money, will not only guide them to the future, but also give you an activity to do together.

Today, where life is moving fast, it is challenging to spend time with your loved ones. However, it is crucial to indulge in activities with your loved ones. Some activities can be a blessing in disguise. One such activity that you can indulge in with your child is to teach them value of money. Nothing supports this activity than savings account.

There are other ways to educate your child about significance of funds as well. They include -

Discuss money

Your job is half done when you approach the topic with a healthy attitude. It is essential to encourage healthy participation. So, address the topic at the right time and with a healthy approach.
One way to address the topic of money management, is to discuss questions like why you cannot purchase the toy? Are we poor or rich? Address these questions by highlighting on beliefs like hard work, saving, cautious spending and charity will help your child see the value of money and propel your child’s mind towards money management.

It is essential to be mindful when discussing this topic as there is a fine line between your child recognising your intentions and thinking you are a penny-pincher. So, try and encourage them with discussions about managing money.

Have a savings account
Have a savings account opened for your child; it will guide your child to value money. Foster the habit to save money and encourage your child to make frequent deposits. Also, explain to them about bank interest.

Try to open zero balance account in a bank that offers children's accounts. You could open one using mobile banking apps as well. A child’s account is generally a joint account managed by the parents until the child is old enough to manage it. When they are mature enough to understand, teach them simple banking tasks like depositing cash and cheques, how to check their bank balance, etc.

Price Evaluation
Evaluating or comparing prices of products is a way to smart buying. By teaching this be assured, you will encourage careful and not reckless spending habits. This activity involves you and your child compare the prices of two products probably branded and local, check the quantity and quality; and decide on which one to buy.

Encourage charity
Besides teaching your child about saving and spending and investing wisely, also encourage them to do charity. It is a good quality which makes your child a caring human being. You can do this by keeping a jar with ‘charity’ written on it and urge your child to put in a specific amount regularly. Use this money to fund a useful purpose or donate it to a reputed charitable organisation.
It is vital to educate your children about the significance of money at a young age so that they can be mature adults and make wise choices related to money in their life.

Digital Banking: Its Benefits And Latest Trends

One of our daily activities involves banking. Now, the banking industry is keeping up with the latest market trends and follow the digital banking concept.

Digital banking in India:

It is an umbrella term that includes online banking, PC banking, internet banking, mobile banking apps, and other data-driven channels. Digital banking services include making transactions, submitting requests, and handling other banking activities online. The internet banking system started in 1996 in India. Since many banks have followed suit and provide banking facilities across mediums.

Importance of digitisation:

• Numerous factors brought in mechanisation and digitisation in the banking industry in India.
  
• A system called Magnetic Ink Character Recognition (MICR) helps in sorting and processing cheques. Every bank has the MICR system in place and follows it as well.
  
• The other step was more of an innovation. Banking is a repetitive and monotonous job. Employees tend to make mistakes. Therefore, to minimise the errors and speed the process, banks use computer technology with standalone computers and local area networks.
  
• As the networks grew and banks connected, Centralised Online Real-Time Exchange (CORE) banking came into being. The services provided here are financial transactions, accessing accounts from the participating bank branches.
  
• This resulted in different modes of fund transfer, which primarily include RTGS, NEFT, and IMPS.
  
• Nowadays, people are more inclined to their smartphones and banking taps this aspect as well. You can find banking here as well.

Benefits of digital banking:

There are a couple of digital banking benefits that not many are aware of –

• Customer service: With the internet available everywhere freely, the customer only needs a device and decent internet connectivity. It saves not only time but also the expenses as you no longer need to travel to the bank to carry out the transactions. You can also get rid of the never-ending queues. Sit at the comfort of your home or work and get the desired task done. 

• Availability: You can track your records anytime and use the digital banking services round the clock. Transferring funds has only become easier, quicker, and safer. 

• Time constraint: You had to wait for longer period to avail of service earlier. Banks earlier had boards put up outside the branches specifying the time limit for each facility. 

• Online bill payments: Another benefit under digital banking is that customers need not carry cash everywhere they go. You can get all bills such as utility, credit card, and EMIs paid immediately. You can even set schedules for them. This way, you will not delay the bill payments. 

• Lower overheads: The operating costs of the banks have reduced drastically. This has made it possible to reduce service charges and offer higher interest rates for deposits. Lower operation costs mean more profits for the bank.

Latest trends:

The benefits themselves stress the importance of online banking. The socio-economic factors emphasise on why one needs to switch to digital banking today. Considering the fraudulent activities are on the rise, it is safe to conduct financial operations digitally.

Precisely why more and more are introducing new features over banking apps and internet banking. These include –

• Electronic wallets: Since you can use the smartphone for almost every daily task, the Government encourages people to adopt electronic wallets. There has been rapid increase in the use of debit or credit card and the trend continues. 

• Chatbots: Under the customer care operation section, the banks have already employed the chatbots feature. In case of any query, the customer care executive responds to them through chatbots. The banks have improved the quality of interaction and services rendered. 

• Mobile technology: Since the digital banking services are expanding technologically, and banks have their presence felt over mobile banking apps too. More and more features get added frequently. Sometimes banks use this medium to promote their campaigns also. 

• Paperless transactions: Banks are realising that there is no scope for physical, financial operations anymore. Banks focus on end to end digital marketing only now.

Everything You Need To Know About Kids Savings Account

In these times, it is very important for a child to know basics of personal finance. Teaching your child through live examples is a better way to ensure long lasting learning and retention. Recognizing this, banks have come out with a different type of saving account specially for kids. They can operate this account and learn the basics about a savings account.

There is no need to wait till your child is 18 years before opening one. You can open zero balance account and give your child the responsibility of managing this account.

Features of Kids saving account:
The account is a zero-balance account which means there is no need to maintain a set balance in it. The account is linked to the parent or guardian’s bank account. In case the balance is zero, funds can be transferred from the linked account to the kids saving account. However, a few banks may insist on a minimum balance. So, it is better to check the rules before opening this account.

The account comes with a free debit card that the child can use to make cash withdrawals from ATM to swipe at merchant outlets. The debit card comes with a shopping limit, which means that your child won’t be able to spend more than the limit.

Banks also provide free cheque books, free passbooks, free email account statements. The account holder can also use internet banking and mobile banking. It is also possible to pay bills through this account.

This account is only in operation when the child is a minor. Once the child is a major, a regular savings account must be opened. It is possible to convert this zero-balance saving account into a regular saving account by filling up a form.

Banks may also offer a sweep in facility where funds above a particular limit are put into a fixed deposit. This ensures the savings account earns higher income.

Most banks require an auto debit facility to transfer funds from the parent or guardian’s account to the kids saving account to maintain a balance.

Some banks also provide free insurance to cover the child in case of the parent’s death.

How to open a kids savings account:
It is possible to open online saving account in this case by filling up a form on the bank’s website. Considering it is the era of e-banking apps, you could open one via your smartphones as well. Else, visit the branch and complete the procedure.

The documents required for this account are:

• KYC documents of the parent or guardian, if the child is less than 10 years of age
• Date of birth proof for example, birth certificate

Not all banks may require a passport size photograph. Once the application for online saving account opening is processed, your child’s saving account gets opened in a jiffy. Your child can then start to operate this account.

5 Fixed Deposit Rules And Regulations You Must Know

An FD is one of the most versatile investment options available to the people today. This deposit is completely flexible, in the sense you can decide the deposit amount as well as the tenure. The deposit is easy to open both online and offline and provides a safe way to invest funds for a lot of people. A fixed deposit is a fairly simple and standard investment to understand. Funds are locked in for the period of investment and an interest is paid in return. However, there are a few rules related to your FD account that you must know.

Here are 5 fixed deposit rules and regulations you must know:

Deposit insurance:

One of the reasons why a bank fixed deposit account is preferred by the people is the deposit insurance. Each deposit made in a bank is insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC). The bank bears the cost of insuring these deposits. As a part of this, each depositor is insured up to Rs. 1 lakh by the DICGC. This amount will be payable in case the bank closes or ceases operations.

Tax on fixed deposit interest:

Fixed deposit interest is taxable under Income Tax. The bank is required to deduct tax at 10% if the total interest payable exceeds Rs. 10,000 in one year. This interest is clubbed for the depositor from all branches i.e if fixed deposit interest from 3 branches totals Rs. 8,500, then no tax will be deducted by the bank. If you don’t update your PAN card with the bank, then the bank will deduct tax at 20% on the interest amount.

Steps to prevent bank from deducting tax:

If your income is not exceeding the no tax limit for the year, then you can fill up form 15G/15H and submit it to the bank. These forms certify that your income is not taxable and the bank will not deduct tax. If you forget to fill up this form and submit it to the bank, tax will be deducted. However, you can claim a refund on this in your income tax return. Form 15H is for senior citizens whereas Form 15G is for other depositors.

Loan or overdraft against fixed deposit:

An FD account is also reliable because it is possible to take a loan or an overdraft against the fixed deposit account. The rate of interest on this is generally 1% more than the fixed deposit rate. This loan is generally given up to 90% of the fixed deposit amount. This keeps the fixed deposit operational and also gives a loan at a reasonable rate of interest.

Premature liquidation:

In case you need funds, it is possible to liquidate the fixed deposit prematurely. The principal amount and the interest earned on the FD account are credited to the respective savings account. However, a penalty of 1% is charged for liquidating the fixed deposit before time.

What Are The Features Of Mobile Banking?

With the world moving so fast, everybody is always on the move. But, the urgency of conducting financial transactions can come up at any point which may completely disrupt an individual’s plan for the day, as they will have to visit the bank for conducting the financial transactions. However, this is a story of the past, with the advancement and latest in technologies, an individual can conduct all of their financial transactions through mobile banking. Mobile banking is a convenient way of conducting financial transactions without any problems.

 There are some features of mobile banking apps that make the process of banking through mobile phones easy and convenient for customers. Some of the features of mobile banking are listed below:

1. One of the most significant benefits of mobile banking is that an individual can access the features of mobile banking at any time. There is no need for an individual to go to a bank or an ATM and wait for the bank to open to check their account balance, transfer money, pay the bills or even see the account statement. An individual can conduct all of their banking transactions through mobile banking. Fund transfer transactions may complete when the bank is open, but an individual can check the account balance or get account statement irrespective of time or day. 

2. A financial institution understands that all of their customers do not have access to the internet, and this is why they offer mobile banking services to their customers over SMS and USSD. An individual who owns smartphones and has access to the internet can download and use the financial institutions mobile banking app, and others can use the mobile banking SMS and USSD services. A customer should use the right SMS format for availing the SMS banking service and the right prefix for USSD services. 

3. A customer’s bank account and the set of personal information that they have provided will remain totally safe if they use mobile banking. A bank provides the individual with a set of login credentials that they can use for signing into their account and carrying out the transactions. The login credentials are provided to the individuals securely and since they are the only one who knows the login ID and password, their account is always safe. A lot of banks allow an individual to enable two-step verification, where they can only carry out the banking transactions. If an individual enters the One-time passwords sent to their registered mobile number. 

A common misconception that individuals have is that if they want to avail the mobile banking services, it will cost them a lot. However, it is the contrary, mobile banking services are provided for free by the financial institutions. An individual will not need to pay any type of extra charges for registering to mobile banking, unlike ATM transactions where they will get a limited number of free transactions, an individual can check the account statements, balance or pay their bills as many times as they want.

6 Features Of Opening A Saving Account

A saving account is an efficient way of saving funds for future expenses. A saving account will offer an interest rate which is slightly higher than the rate of inflation, for keeping the real value of money stable throughout the years. Any individual can go for an online saving account opening by just visiting the official website of the financial institution.

A lot of modern financial institutions that offer a saving account are providing these accounts which are packed with great offers and quick links for paying bills and making quick transactions. Interest rates offered on a saving account will differ at different financial institutions.
A saving account will help an individual cover any type of unexpected expenses which may arise in the future. Holding a savings account will help improve financial stability as the funds in the account have limits on the number of withdrawals made against the account. A bank will customize a saving account depending on the general usage an account witnesses in a lifetime.

A saving account is a type of account which is opened at a bank or any other financial institution which earns a moderate interest on the balance maintained. A saving account is essentially opened for putting aside some funds which are not required immediately. A bank will place restrictions on the number of withdrawals which can be made from the account every month. Interest rates which are earned on the savings account are determined based on.

Some of the features of opening a saving account are listed below:

1. As the name suggests, a saving account is a safe place for storing surplus funds obtained by the customer. These surplus funds help in building a nest egg for any type of unexpected situations which may arise any time in the future.
2. Every saving account, whether held at a nationalized financial institution or any other financial institutions, is always safe.
3. A balance in the saving account earns interest. While the interest rate may not be as high as other bank deposits, as the funds are not withdrawn on a regular basis, it continues to increase the funds in the account.
4. A saving account is provided the account holders some level of liquidity. Financial institutions usually provide account holders with debit or ATM cards which can be used for making a certain number of withdrawals from their savings account.
5. A lot of financial institutions provide a saving account with different insurance covers including personal accidents and death.

An added benefit of a lot of saving account holders is that a lot of financial institutions offer great discounts on the locker rental facilities for customers who maintain the minimum quarterly balance.

5 Advantages Of Mobile Banking Apps For Banks And Customers

Operating financial activities has become easier today, thanks to mobile banking. You can transfer funds, requests for cheque books, passbook, apply for loans, create savings account, etc. with a click of the mouse. People swear by these banking apps as they are built by the banks or mobile application’s best in-house team.

With the number of m banking users increasing by the day, they have done away with long-standing queues and unwanted rantings of the bank representatives.

How did banking apps gain prominence? 
Online banking date backs to SMS alerts and customer care. Gradually, it turned to SMS banking in 2002. In the same year, almost every bank launched their mobile banking apps. It contained all the facilities that one would have to otherwise complete by visiting the local branch. Since, banking apps have been nothing less than revolution.

Following are the reasons why more and more people are inclining towards banking apps:
1. Availability: In case of cash transfer of funds to friends or family members for emergency purpose or otherwise, you can do so immediately. Mobile banking is available 24*7. Some apps also have in-built query system in place that clears your doubts anytime, anywhere.

2. Time-saving: A mobile banking app manages your finances without interrupting your day-to-day activities. You can pay your credit, utility, and existing EMIs instantly. You also have the facility to automate your payments on predetermined dates. This avoids debts and default.

3. Infrastructure costs: Banks save on infrastructure charges as they do not have to build more branches for people to visit. With all the facilities available at the tip of your finger, customers gain satisfaction in real-time.

4. Safety: One of the reasons why people do not opt for m banking is the safety concerns. Most of these issues will not exists if the measures are taken from the users end. Customers should avoid using their app in public spaces as fraudsters can hack the password and username in open area easily. All banks use encryptions that protects users’ financial information. OTPs and password-protected apps have made the task easier for customers today.

4. Control: You are on cruise control the moment you switch to mobile banking apps. You can track your finance and gauge your financial status. You do not have to worry about fraudulent activities as layers of security protect banking activities. In case your account is on the brink of lowering, you receive notification on SMS and e-mails. You can also monitor debit and credit card activities when you have to send money to the beneficiary. 

6 Savings Account Charges To Consider Before Opening A Savings Account

A savings account not just inculcates a saving habit but is also useful for emergency purposes. However, many banks have limitations on the number of withdrawals. The volume of transactions made on the account comes with a fee. These charges vary from bank to bank. Sometimes, they vary depending on the type of account as well.

You should be aware of the mentioned charges before you open a savings account:

• Non-maintenance of balance: This is one of the most common penalties that banks levy. You receive interest depending on the minimum balance you maintain. These charges are usually minimal. For a regular savings account, the fees are anywhere between INR 100 to INR 350 per month. On the other hand, the premium account has higher charges. It can go up to INR 600 per month. So, carefully consider these charges before choosing the savings account.

• Cash transaction charges: Every bank allows only limited cash transaction. If you cross that limit, you have to pay the penalty. Most banks allow only five free cash transaction per month. Beyond that, you have to pay the necessary costs. Some banks have also placed caps on the value of the cash transaction per month. Premium accounts involve a higher limit on a cash

• Cheque book fee: Although online transactions are trending now, some places still accept only cheque as a means of finance. A standard cheque book, which banks offer for free at the beginning, contain 20-25 cheques. If you order a new one, you have to pay a minimal amount. If you have premium savings account with a high average balance, you need not worry about cheque book issuance charges.

• Debit card costs: When you open a bank account, you are given a welcome kit along that includes a debit card. So, banks levy issuance and maintenance charges as well for the same. Sometimes the costs change depending on the services the banks offer. Certain premium accounts provide free regular debit cards.

• NEFT & RTGS charges: The two most preferred mode of transactions in India are NEFT and RTGS. NEFT has no lower limit on fund transfer whereas RTGS has a limit of INR 2 lakh per transaction. However, the movement of funds is faster under RTGS and gets done real time, on an account to account basis. Banks have specific charges in place regarding NEFT and RTGS. Some banks waive off the costs for premium accounts.

• Cheque return fee: If the cheque issued bounces back, the concerned bank levies return charges. The return cheque charges will be higher than the ones released by the third party.

Before you open a savings account through app, remember these additional charges.

5 Reasons a Banking App Is Preferred

Mobile and internet banking is becoming popular around the world. As the number of smart-phone users increases, more and more people prefer using apps for many reasons. Using a banking app to carry out financial transactions is now a necessity rather than a luxury. Moreover, as customers become more tech-savvy their expectations become higher. Banks which cannot keep up to their customers’ expectations usually lose out over competitors. Digitalisation has revolutionised financial technology and the best banks make the most of what technology has to offer. Here are some reasons why using an app is preferred over other options:

Easy to Use: The primary reason for customers to switch from traditional banking processes to using apps is, ease. An app provides a more engaging and seamless interaction between the customer and the bank. With a simple swipe or a tap, you can make bill payments, transfer funds, apply for products and make investments. No longer do you have to wait in long queues to open an account, an app facilitates instant bank account opening.

Accessible: There may be some customers who still prefer visiting a physical bank branch. There are, however, millions who expect 24/7 services. With the use of internet, the world has become smaller and financial transactions have become more complex. With differing time-zones and demographics, people cannot afford to wait for regular banking hours to begin. With a banking app, millions of customers can carry out banking transactions at any time and from anywhere.

Better Mobility: A few decades ago, customers who travelled frequently had to change their bank accounts based on the location. Now, with an app, your bank moves with you. No longer is there a need for closing and opening accounts, you can simply access your account with an app.

Paperless Transactions: Using an app does away with the need to generate endless and unending piles of paperwork. Traditional banking practices involve plenty of documentation for any process. Which also means clutter and inventory to deal with. You can now carry out any banking transaction, even open a paperless saving account!

Real-Time Transactions: Transactions through a banking app occur instantly. Be it checking your account balance, or more complex transactions like opening fixed deposits, all these take a few minutes.
Customers expect information on their finger-tips, be it computers, mobiles or any other smart device, information needs to be immediate. To keep up, banks need to continuously ramp-up their technology.