4 Step By Step Guide To Convert Your Salary Account to Savings Account

Anyone who is employed in a company or organization will be familiar with what a salary account is. These are the accounts that employers open in order to credit their employees’ salaries. Employee salary accounts are typically created with the same bank that the company has accounts with and uses for banking activities.

However, when you do not use the account anymore you have the option to convert your salary account to saving account where you can deposit funds when it is practical and accessible. A salary account does have a unique set of benefits, including:

• Freedom From Debit Card Charges – Most debit cards provided with salary accounts include a waiver of yearly fees or issue fees.
• Zero Balance Requirement – Typically, there is no minimum balance requirement for salary accounts in order for them to stay open.
• Free Drafts & Pay Orders – Account holders of salary accounts frequently have unfettered access to draughts and pay orders.

In this article, we will discuss how you can transfer your salary account to saving account when it is not in use and what things you should be aware of while going through the entire process.

If your salary is not credited to your salary account for three consecutive months then it will automatically turn into a savings account.

A step by step guide to convert your salary account to saving account

A salary account’s main function is to credit an employee’s salary. However, the Bank will automatically switch it to a savings account if there aren’t any credits for three months in a row by your employer. The account will then operate in accordance with all the guidelines for savings accounts.

However, if you want to transfer your salary account to saving account instantaneously then you need to follow the steps mentioned below:

1. First, go to your nearest branch of the bank.
2. Then talk to the customer relationship manager and tell them that you want to convert your salary account to saving account because you won’t be receiving your salary on that particular day.
3. The bank representative will ask you to submit an application mentioning the details of your account and the company you used to work for.
4. After accepting your application, your salary account to saving account conversion will be completed and your bank account will function as a normal savings account.

Things you need to know before converting your salary account to saving account

Knowing the minimum balance condition is necessary

Savings account holders often need to keep a specified minimum balance in their accounts. Therefore, always examine the minimum amount that you will need to maintain for that account before switching from a salary account to saving account. This is crucial since failing to maintain the required minimum balance in your savings account can result in banks charging various fees, some of which can be quite significant.

For instance, Axis Bank mandates that holders of savings accounts maintain a minimum balance of Rs 10,000 in urban and metro regions. However, for a savings account, banks like Standard Chartered mandate that account users have a minimum balance of Rs 25,000.

When converting change your address

The majority of the time, we submit our office address for communication while creating our salary accounts so that we can communicate with the bank. However, it is extremely necessary to update the address for communication when you switch the salary account to saving account.

All account-related information, including monthly statements, credit/debit card bills, and more sensitive data like internet banking and mobile banking passwords, debit/credit card PINs, cheque books, etc., will continue to be sent to your now-former office address and run the risk of being misused if you do not change your address. Remember to update your postal address along with your email address when switching from one place of employment to another to avoid it from happening.

Check out the locations of the bank branch

The location of your bank’s branches is another consideration when it comes to banking. Even while the vast majority of banking tasks can now be completed online or through mobile devices, there are still a few services that can only be accessed physically at a branch.

Numerous services are only available on the bank premises. For this reason, it’s crucial to ascertain whether the bank you’re converting your pay account with has a branch near your location of residence so that you can easily visit the branch when a complex situation arises.

To Conclude

Along with understanding how to convert a salary account to a savings account, you need also be aware that this procedure is simple and straightforward. However, a few requirements must be met. For the conversion procedure, various banks have different standards and requirements. So, you should have a thorough understanding of all of its circumstances.

Checking a financial institution’s branch locations and minimum balance requirement is essential before proceeding. Don’t forget to update your communication address as well. Making such a simple error can have serious consequences.