How to Change a Salary Account to a Savings Account?

Convert a Salary Account to Savings Account?

A Salary Account is an account to which your salary gets credited. Usually, banks open these accounts on request of corporations and major companies. Each employee of the company gets their own Salary Account which they are required to operate on their own. When the time comes for the company to pay its employees, the bank takes the money from the company’s account and then distributes it to the employers accordingly.

What is a Salary Account?

What is a Salary Account? A Salary is a form of payment from an employer to an employee, which is usually specified in an employment contract. An account maintained by the employer to pay salary to the employee is known as Salary Account. Most banks in India, have salary accounts of individuals who work in different sectors. It is also known as Zero Balance Account.

  • Zero Balance Account– An individual does not need to maintain a minimum balance in the account for the account to remain active
  • No Debit Card Charges– The salary account debit card does not include any annual charges or issuance charges
  • Free Draft & Pay Orders– The salary account holders can avail the facility of payment orders and draft

What is Savings Bank Account?

Savings Bank Account is a deposit account held at a retail bank which pays interest on the deposited amount, but it cannot be used directly as money in the sense of a medium of exchange. This kind of accounts has to set aside a portion of their liquid assets while earning a monetary return.

In case of a job change, the salary account is converted automatically to a savings account if no salary is credited to the account for more than 3 months. Moreover, once the salary account is converted into a savings account, the benefits related to the salary account are no longer offered. So, in case of a job change, here are a few aspects to keep in mind that will be helpful to convert a salary account to a savings account.

Salary Accounts Vs Savings Accounts: What Is The Difference?

Salary Account & Your New Job

Before you convert your old salary account (held with a previous employer) to a savings account, do check with your new employer if they would allow you to continue holding on to your existing salary account. This is possible if the new organization too holds accounts with the same bank as your previous employer. If it is possible, it will save you a fair bit of paperwork which you’d have to submit in order to open a new salary account, and also one more account to manage.

Do You Need Another Savings Account?

In case the new company does not hold the accounts with the same bank as the previous employer, then the employee will need to open a new salary account with the bank associated with the company. Before opening a new salary account an individual should consider whether they want to continue with the existing salary account and change it to a savings account or not.

Minimum Balance Requirement


Salary Accounts usually don’t come with a minimum balance requirement, while banks require that you maintain a certain amount of minimum balance in your Savings Account. If you open an Insta Saving Account, you can use even the Saving Account without requiring a minimum balance for up to a year.

Communication Address

Though a majority of banking functions can now be done online via the internet or mobile banking, there are several other banking services which can be availed only at the branch location. For a salary account, the employees generally provide the office address for the purpose of bank-related communication. However, while converting the salary account to a savings account make sure to change the address as well, for any bank-related communication.

Interest rates


Banks offer interest on both Salary as well as Savings Account. The interest rates depend on the type of Savings/Salary Account you have.

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