Opening a bank account with a bank is really like starting a relationship – easy enough to get into, not always pleasant, and difficult to end. So it makes sense to take a step back and think before deciding which Bank you want to have an account with.
So how do you decide which bank is best for you? As with most things, it depends on what is most important to you as an individual. We will go over a few of the important points to consider below:
Safety of funds
When you keep your money with a bank, the most important thing is safety. This is your hard-earned money, and whether you choose to keep it in a Fixed Deposit or lying in a Savings Bank account, you want to be able to call that money your own. For this reason, it is always better to trust a large-sized bank with Deposit insurance rather than a small Co-operative bank which might offer a higher rate of interest, at least for the bulk of your funds.
Fees
Banks love to charge fees to clients. It is, in an environment where interest rates and lending is under pressure, due to slow industrial growth, a surefire way for them to make some money. But as a consumer, we should be shrewd and look for the Banks which allow a high number of free transactions. Account maintenance charges, debit card fees, ATM fees, phone banking fees etc. should be within reasonable limits. Most banks will offer a waiver on these fees if you maintain a certain amount of balance, so explore whether something like this works for you.
Ease of access
This depends on your needs. If you do most of your banking online and don’t often need to deposit checks or cash, you may opt for a bank with fewer branches but better rates or good online facilities. However if you do need to use these facilities or are more comfortable dealing with a teller than an online environment, look for a Bank with a branch nearby. On similar lines, if you travel a lot and need to access your Bank in multiple places, look for which Bank has a good branch network in the places you need it.
Customer service
While this is something you will not personally experience before you open an account, ask your friends if they bank with a specific bank or look online for reviews of a bank’s customer service. When dealing with your own money, the importance of a quality customer care representative is increased. You need to feel your bankers care as much for your money as you do.
Online facilities
Even if you generally prefer operating your account through a branch, it is useful for a bank to offer internet banking facilities. A number of services from bill payment to income tax demands can be done online and it simply makes more sense to have an account that offers this facility
Interest
The interest offered on your deposits, as well as what is charged on overdrafts should form a part of the consideration. Keep in mind though that you do not compromise on safety and security of your funds in looking for higher interest.
Add-on services
Apart from plain vanilla banking, several banks also have the ability offer other services from credit cards to broking accounts. If you expect to use advanced financial services such as online trading, demat services, mutual fund investment, insurance and so on and so forth, it makes sense to opt for a bank that is able to offer you all these services under one roof. The larger private sector banks, especially, have taken this approach and try to offer a wide range of services to account-holders. Of course, these services come with a fee, so balance your needs accordingly.
In the final analysis, you have to decide which of the features offered by a bank are important to you. Often, the Bank which suits the needs of a businessman might be very different from the one preferred by a salaried person and that would again be different from a senior citizen retiree. Weigh your options and do your research before you sign on that application form!
