Opening a bank account can seem intimidating.

Fortunately, most banks and credit

unions follow a process similar to the one described below. Getting your account open is
really just a matter of providing certain details and funding your account. Once the
formalities are done, you can start using your account — and save time and money.

Use the checklist below as a roadmap. You’ll know what steps you need to take, and
you’ll get tips to help you complete each step.

Step 1: Choose a Bank or Credit Union

You might already know where you want to bank. If not, shop around. Start by finding
the best match for your immediate need (a checking account, for example). As you
compare institutions, be especially mindful of fees that can eat into your savings.

There are three basic categories of banks:

Banks, including community banks and big banks: These might be well-known
brands in your local community (or nationwide), and they offer most of the basic services
you need. Local and regional banks tend to have more friendly fee structures, but it may
be possible to get fees waived at big banks.

Credit unions: A credit union is a customer-owned financial institution that provides

many of the same services and products that banks provide. These organizations often
have competitive rates because they aren’t necessarily trying to maximize profits. But
that’s not always the case — so review fee schedules carefully.

Learn more about credit unions and how you can join one.

Online banks and credit unions: Some institutions operate entirely online. There’s no
branch to visit (or pay for), and you’ll handle most service requests yourself. If you’re
comfortable with your computer or mobile device — and most basic banking transactions
— an online bank can help you earn higher interest rates on savings and get free
checking.

That said, you don’t have to pick just one type of bank — it’s wise to open an online
bank account and keep your brick-and-mortar bank.

You’ve got numerous choices. For more discussion on finding the right bank for your
needs, see How to Choose a Bank.

Step 2: Visit the Bank Branch or Website

The easiest way to open an account is to visit the institution’s website. Search for the
bank on Google, or visit the website listed on the bank's marketing materials (be careful
when you type in the web address — impostor sites with similar names may exist).

The advantage of opening accounts online is that you can do it at any time, from
anywhere. However, if you're only comfortable opening accounts in person you can
simply show up at the branch during business hours. Before you leave the house, be sure
to have the following items ready:

 Identification (government-issued ID like a driver’s license, passport, military ID)

 Your Social Security Number or similar
 Your physical and mailing address
 An initial deposit (if required at the time of opening)

Step 3: Pick the Product You Want

Any financial institution will have a variety of account types and services that you can
choose from.

Banks often give their products unique names that can be confusing, but they’re basically
products at every institution:

 Checking accounts for making payments and direct deposit

 Savings accounts for earning interest
 Money market accounts for slightly more interest (while keeping access to your
cash)
 Certificates of deposit (CDs) for earning even more when you lock up your funds
 Loans of all types (auto, home, personal loans, and more)

Different names are usually different levels of service (with correspondingly higher
pricing or thresholds to avoid fees). Pick the option that has a mix that is right for you.
For example, if you'll keep a low balance in the account, just open an account that keeps
fees at a minimum. Avoid the accounts that require a large balance in order to qualify for
fee waivers — you rarely need all of the extra features.

When working online, you may have to drill down to the product that is right for you.

You might click “Open an Account,” and then click “Checking,” and hunt among the
various choices for “Free Checking.” If you open your accounts in person, you can just
chat with a banker who will help you find the best account for your needs.

Step 4: Provide Your Information

As you open a new bank account, you'll need to provide sensitive information to the
bank. In order to protect themselves and comply with regulations such as the Patriot Act,
they simply can't open an account without verifying your identity.

You’ll need to provide simple details like your name and birthday, as well as
identification numbers (in the U.S. this is most likely your Social Security Number). You
should also be prepared to provide a valid government ID (such as a Driver’s License or
passport).

If you’re doing this online, you’ll just type the information into a textbox. If you open
your accounts in person you'll hand your ID’s over to the banker, who will probably
make photocopies.

Step 5: Agree to Terms

You’ll have to agree to abide by certain rules and accept responsibility for certain
activities in your accounts. When you open an account at a bank, you form a relationship
based on a very important subject – your money. Therefore you should know what you’re
getting into. If you open bank accounts online, you complete this step by clicking an “I
Agree” (or similar) button, and moving on to the next step.

Read your agreement carefully. Although disclosure is getting better, there are a lot of
important details buried in the fine print. In particular, you'll want to know about any fees
charged to your account, and when your funds are available for withdrawal.

In addition to bank agreements, federal law dictates your rights and responsibilities. For
example, if somebody takes money out of your account fraudulently (or due to an
error), you might be protected. However, you may need to report the withdrawal quickly
for full protection.

Step 6: Print, Sign, and Mail (If Required)

If you open a bank account in person, this step does not apply, so skip to Step 7. If you
are opening an account online, you may have to print, sign, and mail a document to the
bank before the account is opened. Some banks use electronic disclosure and consent that
is legally binding — you can do everything online. But some banks still require a signed
document to open an account. Until they receive the documents, your account is not
active.

Step 7: Fund Your Account

If you’re opening a checking or savings account, you’ll need to make an initial deposit
into the account. Sometimes this is required as part of the opening process, and
sometimes you can do it after the account is up and running. There are several ways to
fund your account:

1. Deposit cash, which should be available for spending with your debit
cardimmediately.
2. Deposit a check or money order to your account. The funds should be available
within a few business days after you make the deposit.
3. Set up direct deposit with your employer. Instead of getting a paycheck, your
earnings will be sent directly to your new account.
4. Transfer funds electronically. Move money from an external bank account to
make your initial deposit.

Step 8: Start Using the Account

Congratulations, you are the proud owner of a new account! Your account may be ready
within a few minutes to a few days.

For checking and savings accounts, keep an eye out for a debit card (or ATM card) in the
mail. You might also get a checkbook so you can write checks.

To make the most of your account, sign up for features that help you manage your
money:

 Online bill pay allows you to pay bills electronically (without writing checks or
mailing payments).
 Your bank’s mobile app may allow you to deposit checks remotely. You won’t
need to make trips to a branch of fill out deposit slips.
 Sign up for text or email alerts so that you know when your account balance is
running low (or when large withdrawals happen).
 TYPES OF BANK ACCOUNTS IN INDIA (Deposit Accounts)

CURRENT DEPOSITS / ACCOUNTS

SAVING BANK / Saving Fund

DEPOSITS / ACCOUNTS

RECURRING DEPOSITS /

ACCOUNTS

FIXED DEPOSITS / ACCOUNTS OR

TERM DEPOSITS
 Traditionally banks in India have four types of deposit accounts, namely Current
Accounts, Saving Banking Accounts, Recurring Deposits and, Fixed Deposits.
However, in recent years, due to ever increasing competition, some banks have
introduced new products, which combine the features of above two or more types of
deposit accounts. These are known by different names in different banks, e.g 2-in-1
deposits, Smart Deposits, Power Saving Deposits, Automatic Sweep Deposits etc.
However, these have not been very popular among the public.


 What is a Current Account ? Who uses current accounts? Current Accounts

in Banks


 Current Accounts are basically meant for businessmen and are never used for the
purpose of investment or savings. These deposits are the most liquid deposits and
there are no limits for number of transactions or the amount of transactions in a
day. Most of the current account are opened in the names of firm / company
accounts. Cheque book facility is provided and the account holder can deposit all
types of the cheques and drafts in their name or endorsed in their favour by third
parties. No interest is paid by banks on these accounts. On the other hand, banks
charges certain service charges, on such accounts.


 Features of Current Accounts :



 (a) The main objective of Current Account holders in opening these

account is to enable them (mostly businessmen) to conduct their
business transactions smoothly.
 (b) There are no restrictions on the number of times deposit in cash /
cheque can be made or the amount of such deposits;
 (c) Usually banks do not have any interest on such current accounts.
However, in recent times some banks have introduced special current
accounts where interest (as per banks' own guidelines) is paid
 (d) The current accounts do not have any fixed maturity as these are
on continuous basis accounts


 What is a Savings Bank Account ? Who uses Saving Bank Accounts ?



 These deposits accounts are one of the most popular deposits for individual
accounts. These accounts not only provide cheque facility but also have lot of
flexibility for deposits and withdrawal of funds from the account. Most of the
banks have rules for the maximum number of withdrawals in a period and the
maximum amount of withdrawal, but hardly any bank enforces these. However,
banks have every right to enforce such restrictions if it is felt that the account is
being misused as a current account. Till 24/10/2011, the interest on Saving Bank
Accounts was regulared by RBI and it was fixed at 4.00% on daily balance basis.
However, wef 25th October, 2011, RBI has deregulated Saving Fund account
interest rates and now banks are free to decide the same within certain conditions
imposed by RBI. Under directions of RBI, now banks are also required to open no
frill accounts (this term is used for accounts which do not have any minimum
balance requirements). Although Public Sector Banks still pay only 4% rate of
interest, some private banks like Kotak Bank and Yes Bank pay between 6% and
7% on such deposits. From the FY 2012-13, interest earned upto Rs 10,000 in a
financial year on Saving Bank accounts is exempted from tax.



  Click Here to know Which Banks are Paying the Highest Saving Bank Interest
Rates / Interest Rates on Savings Account


 What are Recurring Deposit Accounts ? Who use Recurring Deposit Accounts ? or
RD accounts


 These are popularly known as RD accounts and are special kind of Term Deposits
and are suitable for people who do not have lump sum amount of savings, but are
ready to save a small amount every month. Normally, such deposits earn interest
on the amount already deposited (through monthly installments) at the same rates
as are applicable for Fixed Deposits / Term Deposits. These are best if you wish to
create a fund for your child's education or marriage of your daughter or buy a car
without loans or save for the future.


 Under these type of deposits, the person has to usually deposit a fixed amount of
money every month (usually a minimum of Rs,100/- p.m.). Any default in payment
within the month attracts a small penalty. However, some Banks besides offering a
fixed installment RD, have also introduced a flexible / variable RD. Under these
flexible RDs the person is allowed to deposit even higher amount of installments,
with an upper limit fixed for the same e.g. 10 times of the minimum amount agreed
upon.


 These accounts can be funded by giving Standing Instructions by which bank

withdraws a fixed amount on a fixed date of the month from the saving bank of the
customer (as per his mandate), and the same is credited to RD account.



 Recurring Deposit accounts are normally allowed for maturities ranging from 6
months to 120 months. A Pass book is usually issued wherein the person can get
the entries for all the deposits made by him / her and the interest earned. Banks
also indicate the maturity value of the RD assuming that the monthly instalents will
be paid regularly on due dates. In case instalment is delayed, the interest payable
in the account will be reduced and some nominal penalty charged for default in
regular payments. Premature withdrawal of accumulated amount permitted is
usually allowed (however, penalty may be imposed for early withdrawals). These
accounts can be opened in single or joint names. Nomination facility is also
available.


 The RD interest rates paid by banks in India are usually the same as payable on
Fixed Deposits, except when specific rates on FDs are paid for particular number of
days e.g. 500 days, 555 days, 1111 days etc i.e. these are not ending in a quarter.


 (A) Click Here to know the Highest FD / RD Rates of Banks in India



 (B) Click Here for : Recurring Deposit Calculator



 What are Fixed Deposit Accounts in India or Term Deposits



 All Banks in India (including SBI, PNB, BoB, BoI, Canara Bank, ICICI Bank, Yes
Bank etc.) offer fixed deposits schemes with a wide range of tenures for periods
from 7 days to 10 years. These are also popularly known as FD accounts.
 However, in some other countries these are known as "Term Deposits" or even
called "Bond". The term "fixed" in Fixed Deposits (FD) denotes the period of
maturity or tenor. Therefore, the depositors are supposed to continue such Fixed
Deposits for the length of time for which the depositor decides to keep the money
with the bank. However, in case of need, the depositor can ask for closing (or
breaking) the fixed deposit prematurely by paying paying a penalty (usually of 1%,
but some banks either charge less or no penalty). (Some banks introduced
variable interest fixed deposits. The rate of interest on such deposits keeps on
varying with the prevalent market rates i.e. it will go up if market interest rates goes
and it will come down if the market rates fall. However, such type of fixed deposits
have not been popular till date).


 The rate of interest for Fixed Deposits differs from bank to bank (unlike earlier
when the same were regulated by RBI and all banks used to have the same interest
rate structure. The present trends indicate that private sector and foreign banks
offer higher rate of interest.


 The earlier trend that private sector and foreign banks offer higher rate of interest
is no more valid these days. However, now a days small banks are forced to offer
higher rate of interest to attract more deposits. Usually a bank FD is paid in lump
sum on the date of maturity. However, most of the banks have also facility to pay/
credit interest in saving account at the end of every quarter. If one desires to get
interest paid every month, then the interest paid will be at a marginal discounted
rate. In the changed computerized environment, now the Interest payable on Fixed
Deposit can also be easily transferred on due dates to Savings Bank or Current
Account of the customer.