What is the use of current and saving account?

Answer 1

A current account is one in which businesses keep some money and use it for their day to day transactions. The money in this account does not earn any interest and is available for usage to the customer at all times.

A savings account is one in which customers save their monthly savings and they are not like the current account. Though the money is available at any time for the customer to withdraw, money is not as frequently deposited/withdrawn from it like the current account. Hence banks offer a meager interest rate for the money held in this account.

Answer 2

A Savings Bank Account is the basic type of bank account where customers can park or save their surplus cash. The money in the account is extremely liquid and can be withdrawn by the customer anytime they want. As a result, the interest rate provided by the banks on such accounts is also very less. In India the savings account interest rate is 4%. Banks may also give you cheque books and ATM/Debit cards to operate your bank account.

A current account on the other hand is an account used predominantly by businessmen. There usually a higher number of transactions that are allowed in a current account when compared to savings account and it also earns much lesser interest than a savings account.