Vol. XIII, Issue II
2/2012 Catch us also on
http://young.consumer-blog.blogspot.com/ http://www.linkedin.com/pub/consumer-voice/33/a85/849 http://www.facebook.com/ConsumerVoiceIndia http://www.youtube.com/VOICEConsumer http://twitter.com/#!/consumervoice1 http://consumervoiceblog.wordpress.com/
Mosquitoes not at all
Bread and Butter go Desi
Swatted! PAGE 07
15 brands of Glycerine Soaps and Face Wash User Tested PAGE 33
Direct Cool Refrigerator a reliable choice IT PAGE 15
What are Super Speciality Hospitals
ALL ABOUT Unwanted Commercial Calls PAGE 30
Benefit from Saving Account
For the Welfare of Consumers Dr. Premlata
PAGE 32 PAGE 12
SPECIAL REPORT NEWS ALERTS Snippets
Importance of Organic Certification PAGE 20
Total no. of Pages : 44
Editor: Roopa Vajpeyi Chief Editor Prof PK Ghosh Mg. Editor Prof Sri Ram Khanna COO Ashim Sanyal Corporate Head Sisir Ghosh
EDITORIAL English Ann Ancy Jaimon Hindi Keertana Sharma Priyanka Mishra Online Sapna Saini Food Desk Ashok Kanchan Finance Desk Sunil Prabhakar IT Desk Hemant Upadhyay
TECHNICAL H Wadhwa KC Choudhary Mohd. Azim Khan Sheeba Parveen LEGAL HK Awasthi Mukta Kamboj ACCOUNTS Monender Singh Sanjay Kumar
MARKETING Pranay Sheth Ashutosh Massey SUBSCRIPTION Ashu Bhagat Faraz Ahmed ADMIN Ramanjeet Kaur Govind Singh OFFICE SUPPORT Anna Durai M. Shivaneshan
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Finance Service S ervice Test Test
Benefit from Saving Account
e all need saving bank account for every day requirement to receive money in the form of salary, loan, payments in lieu of any kind of services, refund, return on investment and safe-keeping; simultaneously we also withdraw money for paying bills of essential services, school fees, various taxes, investments in various instruments and stock market and cash. Large amount of money remained in the saving bank account as we save a lot. However, banks pay small 4% per annum interest rate, whereas rate of inflation is touching 12%. Which means value of money in banks is reducing by whopping 8%. Consumers are in search to find whether there is any option to turn the table? Now it is possible to beat the inflation by converting your simple saving interest rate into compound and even earn more than what a fixed deposit can earn for you in a yearsâ€™ time. Well we all are aware that interest on fixed deposit is double than 4% interest on saving bank account, however fixed deposit means blocking money for months and years and if we break the fixed we receive zero interest.
No banker will ever tell you to take advantage of Compounding Flexi-Deposit; probably they never envisage consumer can sense it. First, you can convert your saving account into small lot of fix deposit and earn higher interest to do this you just need to decide how much money you need to meet monthly expense and rest of it automatically converted into fix-deposit. Secondly, in order to earn higher interest by way of compounding, make FD for just 7 days instead of 1 year. Why 7 days? Because interest is calculated on per year basis but paid for fixed period, otherwise it is paid at the end of a year. Now, after every 7days, your new FD will earn interest on interest you have earned during past 7 days. This can continue for a years. Indiaâ€™s biggest bank, State Bank of India provides this facility @
8.5% (You may be hearing for the first time but this may result in maximum rate of interest on minimum period of deposit) with a condition that amount of deposit should be of at least one crore. Please remember interest on bank deposit is taxable hence interest in excess of Rs 10000/-will attract TDS @ 10% u/c 194A Income Tax Act 1961. It is important to mention PAN number, as per section 206AA introduced by Finance (No. 2) Act, 2009 w.e.f 01.04.2010, every person who receives income on which TDS is deductible shall furnish his PAN Number, failing which TDS shall be deducted at rate of 20% in case individuals and at the rate of 30% in case of non-individuals for Domestic deposits. In case your total interest income for the year falls within overall taxable limits, you should inform the
Effective % yield for tax-payer
interest rates %
10% tax slab
20% tax slab
30% tax slab
Finance mentioned above if his savings are small, instead saving bank account in State Bank of India or Punjab National Bank can be opened which requires minimum balance of just Rs 500 without cheque book and Rs 1000 with cheque book. Even in HSBC bank, one can open no fills saving account with initial deposit of Rs 250 with free Debit card, which allows unlimited free transaction per month. Even internet banking facility is available for a nominal fee of Rs 99 per year. Cheque book having 25 cheque leaves cost customer a meager amount of Rs 50 However it has some limitations.
bank not to deduct TDS on deposits and file form 15H.
The following table will justify effective rate of savings (percentage yield for taxpayer) on all the 3 income tax slabs with different bank saving interest rates.
require customers to maintain huge average monthly balance called as amb, in case of HSBC bank it is Rs 75000/- for Citi Bank Rs 1,00,000. Previously it was called quarterly minimum balance, not maintaining the same attract financial changes HSBC banks now charging Rs 350 p.m. (instead of per quarter) that increase expense to maintain the saving account to Rs 4200 in a year. This money required to be saved as banks even for other basic services charges extra amount if minimum balance is not maintained.
Banks like Citi Bank, HSBC Bank, ICICI bank, Axis Bank, HDFC Bank
It is in customer’s interest not to maintain saving bank account as
However fixed deposit for period of 5 years up-to Rs 1,00,000 is also part of umbrella of qualified investment u/c Sec 80-C and can be claim to reduces taxable income, but interest earned on these tax-saving FD is fully taxable after 5 years.
As the savings rates are deregulated, bank’s profit margins are going to hit. Therefore banks are imposing new charges like high account closures. However on consumer’s complaint RBI directed banks not to charge the same, so be cautious as banks might introduce new fees on your savings account. So it is advisable to select your bank and service which you require the most and avoid paying charges on monthly minimum balance, remember if you don’t keep enough money to pay these charges some banks like HDFC will close your account and still charge you for maintaining nonoperating bank account. - Sunil Prabhakar
JANUARY 2012 FEBRUARY 2012