A digital savings account is attractive but still unavailable to many people especially in the non-metro cities. I am a resident of a city, which is cosmopolitan and large, but still has nobody to answer you if you want to go for full KYC by biometric verification. This has resulted in a comical but unfortunate situation where RBI has proudly allowed digital savings bank, which is said to be a milestone in Digital India, still, 80% of the country can access no more than the basic e-wallet services of these digital banks. A large part of this country has yet to benefit from this next-level banking. So much for the financial inclusion.
On paper, the digital savings account is really a boon for E-generation. Who has the time to go the branch? Can we always afford the ten-thousand to twenty-five thousand rupees minimum balance for the savings account? Will we always carry the laptop for net banking?
Digibank from DBS is one of the pioneers of digital banking in India. That is at least on paper. It has a fantastic interest rate of 6% until one-lakh rupees and a commendable rate of 7% over 1-lakh rupees for its digital savings account. However, remember that you can avail of this 7% rate only when you can deposit over one-lakh rupees and that needs a digital savings account. In e-wallet, you can keep maximum up to one-lakh rupees at a time. In Digibank, you get a virtual debit card. So, what so special about it! Any e-wallet nowadays provide virtual card. The specialty in the virtual and physical debit card for the wallet and digital account in Digibank, is on two counts. Firstly, it's from VISA and not from Ru-Pay. Secondly, you can withdraw your money from any ATM, any number of times, by this VISA debit. That is huge, considering the rupees twenty charge every time, after the first three to five monthly withdrawals from ATM. Again, for that, you have to change to Digibank savings account from the basic wallet.
Digibank has a lot of exciting cash back offers on flights, hotel booking aggregators, stores etc.
It has the option for POS Visa payment by pay wave thus increasing your cybersecurity at POS terminal other than standard Bharat QR and other QRs.
QAB for Digi savings account is zero, which can make it the preferred digital savings account among students, females without an income of their own, daily wage earners. Etc.
Alas, the distance from the kettle to mouth is proving to be insurmountable for DBS Digibanking.
You can create wallets in a matter of seconds, no doubt. However, should you want to convert it to Digi savings for the unlimited VISA withdrawal, or attractive 6-7% interest rate, you are in for a shock! That is if you are not from selected big cities where Biometric Authentication partner of DBS Digibank is available. There's no one to talk to for help or complaint, except for the AI-powered Chabot, equipped with regular replies. If out of city list, you get the standard reply that “DBS is adding cities”. If not converted, with no interest rate for e-wallets and no physical debit cards, no cash withdrawal facility, your account will remain a midget at wallet level.
In addition, the fact that you have no option to add a secondary debit card is a downer.
ASAP from Axis bank is another digital banking effort.
It has an impressive list of e-merchants on its platform. The list includes Big basket, Cleartrip, Wynk Premium etc. The quality of merchants available here is better than other platforms.
Another attractive feature apart from the regular features is the auto-sweep FD facility. This essentially means that you can break you FD automatically if you do not have money in your savings account. Part of FD breaks to provide you with the required amount of money, while the amount left of the FD remains as it is as FD.
FD facility is available in many digi accounts but Auto-Sweep facility is rarely available in other digi savings account.
This bank has the facility of creation of UPI while creating the ASAP account.
However, one annoying thing is the debit card issue. While debit card in Digibank of DBS comes at a minimum annual charge and is free for endless withdrawals from ATM, the Axis bank debit card for digital savings account comes at a hefty fee of almost rupees 500 annually.
While Digibank gives you an interest rate of 6-7%, axis ASAP savings account give you a measly interest of 3.5% per annum.
Though you do not need Aadhaar details for e-wallet, in ASAP account, without the physical debit card, you cannot register your ASAP account details for mobile banking or net banking. In a way, The ASAP interface indirectly presses you to apply for a debit card, which is costly.
For those who want a reliable good digi banking solution via Adhaar based OTP (minus the in-person verification), Kotak 811 limited digital savings account may be a good solution. While other digital savings account normally have a virtual credit card but are handicapped by the absence of a physical debit card, Kotak 811 limited account has that provision. The fees for debit card available with 811 limited are in the medium range. It costs about rupees 199 plus tax to retain this card annually.
Applying for full KYC of Kotak digital savings account is easier because Kotak has a good presence in tier II and III cities apart from big ones.
Almost all banks pay normal interest in e-wallets before full KYC with the exception of Digibank. However, Kotak 811 pays interest up to 6% for your deposit even in the semi KYC 811 limited digital savings account (akin to e-wallets before full KYC in other digital savings account).
Unlike many other e-wallets, Kotak 811 limited account has also the facility of transfer via Neft and IMPS. RTGS is only available in the full KYC version and rightly so. How many of us use the RTGS normally except for high-value transactions?
However, the cheque facility is not available in the 811 limited KYC version. For this, you have to avail the Full verified 811 edition.
Digital savings accounts from Yes Bank is a non-flashy, functional digital savings account. It supports UPI and virtual card in e-wallet. Where it lags slightly is that it offers RuPay virtual card which may not be the fittest card for international transactions.
Where its ahead of the pack is its support for different modes of merchant payment like QR, Bharat QR, Tone technology based payments and NFC.
Like others have cash discounts, here you can buy gift vouchers for brands popular in metros and tier II and III cities e.g. Baskin Robbins, Pizza chain etc.
Another uniqueness of Yes bank e-wallet (which can be converted to a digital savings account) with verification, is the inclusion of deals available locally (Location based deals). This concept is not only innovative but useful too because we as individuals do not always have the capacity or logistics to travel to far away places.
PayTM-Most Widely available but only a payment bank
PayTM is strictly not a big physical bank but a digital payment bank. Its strength lies in the vast network that it has already created pan India. It has also a robust QR, which unlike Bharat QR, NFC and other verification methods, are already present in your local Kirana stores. The mobile app is very popular and does not suffer from laggy connections that other apps suffer from. The merchant base of PayTM is also huge. But the main problem of KYC verification (for conversion to a savings account) remains because of lack of prompt response by entrusted agents.
The digital savings account is a recent product of RBI and has a wide functionality including no minimum balance requirement, a full battery of online transfer facility including UPI. Insurance, Loan and MFs are also allowed from the platform of these digital payment savings account. However, where the banks having large physical presence score over these digital banks, is the penetration of physical centers which enable biometric verification.
Among the banks discussed above, we found the Kotak 811 full KYC version of digital savings account to be the most viable. It has pan-India financial centers and also has an inexpensive physical debit card facility (unlike ASAP of Axis ) with support for latest transfer technologies like UPI.
Why digital savings account?
On paper, the digital savings account is really a boon for E-generation. Who has the time to go the branch? Can we always afford the ten-thousand to twenty-five thousand rupees minimum balance for the savings account? Will we always carry the laptop for net banking?
A digital savings account is supposed to provide a basic but all-inclusive banking solution for youngsters. It’s for common people who want a fast reliable banking system with payment and shopping integration minus the extra benefits that come with a branch or for preferred high valued customers.
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Digibank From DBS: Forerunner in a digital savings account
Digibank from DBS is one of the pioneers of digital banking in India. That is at least on paper. It has a fantastic interest rate of 6% until one-lakh rupees and a commendable rate of 7% over 1-lakh rupees for its digital savings account. However, remember that you can avail of this 7% rate only when you can deposit over one-lakh rupees and that needs a digital savings account. In e-wallet, you can keep maximum up to one-lakh rupees at a time. In Digibank, you get a virtual debit card. So, what so special about it! Any e-wallet nowadays provide virtual card. The specialty in the virtual and physical debit card for the wallet and digital account in Digibank, is on two counts. Firstly, it's from VISA and not from Ru-Pay. Secondly, you can withdraw your money from any ATM, any number of times, by this VISA debit. That is huge, considering the rupees twenty charge every time, after the first three to five monthly withdrawals from ATM. Again, for that, you have to change to Digibank savings account from the basic wallet.
Digibank has a lot of exciting cash back offers on flights, hotel booking aggregators, stores etc.
It has the option for POS Visa payment by pay wave thus increasing your cybersecurity at POS terminal other than standard Bharat QR and other QRs.
QAB for Digi savings account is zero, which can make it the preferred digital savings account among students, females without an income of their own, daily wage earners. Etc.
CONS:
Alas, the distance from the kettle to mouth is proving to be insurmountable for DBS Digibanking.
You can create wallets in a matter of seconds, no doubt. However, should you want to convert it to Digi savings for the unlimited VISA withdrawal, or attractive 6-7% interest rate, you are in for a shock! That is if you are not from selected big cities where Biometric Authentication partner of DBS Digibank is available. There's no one to talk to for help or complaint, except for the AI-powered Chabot, equipped with regular replies. If out of city list, you get the standard reply that “DBS is adding cities”. If not converted, with no interest rate for e-wallets and no physical debit cards, no cash withdrawal facility, your account will remain a midget at wallet level.
In addition, the fact that you have no option to add a secondary debit card is a downer.
Open account ASAP-Axis bank
ASAP from Axis bank is another digital banking effort.
It has an impressive list of e-merchants on its platform. The list includes Big basket, Cleartrip, Wynk Premium etc. The quality of merchants available here is better than other platforms.
Another attractive feature apart from the regular features is the auto-sweep FD facility. This essentially means that you can break you FD automatically if you do not have money in your savings account. Part of FD breaks to provide you with the required amount of money, while the amount left of the FD remains as it is as FD.
FD facility is available in many digi accounts but Auto-Sweep facility is rarely available in other digi savings account.
This bank has the facility of creation of UPI while creating the ASAP account.
Expensive and Flat!
However, one annoying thing is the debit card issue. While debit card in Digibank of DBS comes at a minimum annual charge and is free for endless withdrawals from ATM, the Axis bank debit card for digital savings account comes at a hefty fee of almost rupees 500 annually.
While Digibank gives you an interest rate of 6-7%, axis ASAP savings account give you a measly interest of 3.5% per annum.
Though you do not need Aadhaar details for e-wallet, in ASAP account, without the physical debit card, you cannot register your ASAP account details for mobile banking or net banking. In a way, The ASAP interface indirectly presses you to apply for a debit card, which is costly.
Kotak 811 –Many Variants but only two are useful
For those who want a reliable good digi banking solution via Adhaar based OTP (minus the in-person verification), Kotak 811 limited digital savings account may be a good solution. While other digital savings account normally have a virtual credit card but are handicapped by the absence of a physical debit card, Kotak 811 limited account has that provision. The fees for debit card available with 811 limited are in the medium range. It costs about rupees 199 plus tax to retain this card annually.
Applying for full KYC of Kotak digital savings account is easier because Kotak has a good presence in tier II and III cities apart from big ones.
Almost all banks pay normal interest in e-wallets before full KYC with the exception of Digibank. However, Kotak 811 pays interest up to 6% for your deposit even in the semi KYC 811 limited digital savings account (akin to e-wallets before full KYC in other digital savings account).
Unlike many other e-wallets, Kotak 811 limited account has also the facility of transfer via Neft and IMPS. RTGS is only available in the full KYC version and rightly so. How many of us use the RTGS normally except for high-value transactions?
However, the cheque facility is not available in the 811 limited KYC version. For this, you have to avail the Full verified 811 edition.
Yes Bank Digital Savings- Solid, Functional but lacking popularity
Digital savings accounts from Yes Bank is a non-flashy, functional digital savings account. It supports UPI and virtual card in e-wallet. Where it lags slightly is that it offers RuPay virtual card which may not be the fittest card for international transactions.
Where its ahead of the pack is its support for different modes of merchant payment like QR, Bharat QR, Tone technology based payments and NFC.
Like others have cash discounts, here you can buy gift vouchers for brands popular in metros and tier II and III cities e.g. Baskin Robbins, Pizza chain etc.
Another uniqueness of Yes bank e-wallet (which can be converted to a digital savings account) with verification, is the inclusion of deals available locally (Location based deals). This concept is not only innovative but useful too because we as individuals do not always have the capacity or logistics to travel to far away places.
PayTM-Most Widely available but only a payment bank
PayTM is strictly not a big physical bank but a digital payment bank. Its strength lies in the vast network that it has already created pan India. It has also a robust QR, which unlike Bharat QR, NFC and other verification methods, are already present in your local Kirana stores. The mobile app is very popular and does not suffer from laggy connections that other apps suffer from. The merchant base of PayTM is also huge. But the main problem of KYC verification (for conversion to a savings account) remains because of lack of prompt response by entrusted agents.
Conclusion
The digital savings account is a recent product of RBI and has a wide functionality including no minimum balance requirement, a full battery of online transfer facility including UPI. Insurance, Loan and MFs are also allowed from the platform of these digital payment savings account. However, where the banks having large physical presence score over these digital banks, is the penetration of physical centers which enable biometric verification.
Among the banks discussed above, we found the Kotak 811 full KYC version of digital savings account to be the most viable. It has pan-India financial centers and also has an inexpensive physical debit card facility (unlike ASAP of Axis ) with support for latest transfer technologies like UPI.
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