Indian Overseas Bank vs HDFC Bank: Children’s Savings Accounts
Indian Overseas Bank (IOB) offers the SB – Little Star account for young children while HDFC Bank offers a dedicated children’s savings account called Kids Advantage Account.
Children’s Savings Accounts from Indian Overseas Bank
SB – Little Star Account
The account has been designed for all children – from 1 day old babies to up to 18 year old young adults.
- The account can be opened by any child aged 1 day to less than 18 years
- The minimum balance needed in the account is Rs. 100, while the maximum amount that can be kept is Rs. 50,000
- IOB offers free collection facility for cheques or draft instruments gifted to the child and valued up to Rs. 25,000 per annum
- It also offers a Sweep-In, Sweep-Out facility where any amount in the account in excess of Rs. 10,000 is taken out of the account and turned into fixed deposits of Rs. 2,000 each. If the balance falls below Rs. 10,000 then the most recent fixed deposits are put back in the SB – Little Star Account so the balance is back to being at least Rs. 10,000
- Parents also have the option to invest in other options such as recurring deposits, insurance, mutual funds and so on
Children’s Savings Accounts from HDFC Bank Limited
HDFC Bank, the largest private sector bank in the country in terms of market capitalisation as of September 2019, offers a dedicated children’s savings account called Kids Advantage Account.
Kids Advantage Account
The primary aim of the account is to help build a corpus for the child for her future financial needs.
- The account is available for every child up to the age of 18 years
- The bank mandates a minimum average monthly balance of Rs. 5,000 below which it charges service fees. The service fee is Rs. Rs. 150 in case the balance is between Rs. 2,500 and Rs. 5,000, and Rs. 300 in case the balance is less than Rs. 2,500
- Minors above the age of 10 years can open and operate the account on their own
- HDFC Bank requires the parent or guardian to have a savings account with the bank before they can open a Kids Advantage Account
- The international ATM-cum-Debit card debit card comes with a Rs. 2,500 ATM withdrawal limit and Rs. 10,000 POS limit per day
- HDFC Bank also offers an education insurance cover of Rs. 1 lakh for the child in case the parent or guardian passes away in a road, rail or air accident
- Its MoneyMaximizer option allows the accountholder to agree to a sweep-out option. Under this when the account reaches or crosses Rs. 35,000, any sum in excess of Rs. 25,000 is automatically transferred to a fixed deposit for 1 year and 1 day
- The accountholders get a free payable at par chequebook of 25 leaves at the time of account opening and every year thereafter
- The account comes with free net, phone and SMS banking facilities
- Indian Overseas Bank Website: www.iob.in and www.iobnet.co.in (net banking)
- Headquarters: Chennai, Tamil Nadu
- Call Centre Number: 1800 425 4445
- HDFC Bank Website: www.hdfcbank.com
- Headquarters: Mumbai, Maharashtra
- Call Centre Number: 1800 258 3838