April 19, 2023

If you’re looking for a long-term investing plan with high returns and minimal risk, the Voluntary Provident Fund (VPF) is a great solution. This program, which is run by the Indian government, provides candidates with tax advantages.

The typical provident fund savings program includes the VPF scheme. In contrast, the contributor determines the monthly fixed investment amount provided to the plan under the VPF method.

the interest rate of 8.1% p.a.
Investing involves very little risk.
It’s simple to move the money in the event of a job change.
Opening a VPF account is simple.

Under the VPF initiative, employees are allowed to make contributions of their own to their provident fund accounts. The program is additionally known as the Voluntary Retirement Fund program. The 12% contribution each employee must contribute to their Employees’ Provident Fund (EPF) is not included in the plan.

The maximum contribution an employee may make to the plan is 100% of their basic pay and dearness allowance. Comparable to the EPF program is the VPF interest rate. Employers and employees are not required to make VPF contributions. The program does, however, have a 5-year lock-in period. The Indian government sets the VPF’s annual interest rate each year.

Eligibility for VPF

Being an extension of the EPF, the VPF program only allows paid employees who receive payments every month into their salary accounts to make investments.

Paperwork needed to start a VPF account

Employees who wish to open a VPF account must provide the following documentation:

It is necessary to file the certificate of company registration with the Ministry of Finance (MoF).
Both Forms 24 and 49 need to be submitted.
The memorandum and articles of association must be provided if the organization is a “Sdn Bhd.”
It is necessary to provide a detailed company profile.
The certificate of business registration must be offered.
In order to open a VPF account, employees can inquire with their employer about any additional paperwork that may be required.

Benefits of VPF

The EEE category, which includes the VPF account, stands for Exempt-Exempt-Exempt. Employees who invest in the VPF can thereby benefit from tax advantages and make significant long-term gains. Some of the main benefits of a VPF account include the following:

Risk-free investment option: The scheme is managed by the Indian government, hence there are no risks involved. It is extremely safe to invest in a VPF account compared to other long-term investment choices provided by commercial companies.

High-interest rate: The VPF program has an interest rate of 8.1% per annum. Taxes are not applied to the interest that results from contributions.

Easy application process: Opening a VPF account is a pretty easy process. Employees can submit the registration form to their employer’s finance department and ask them to start a VPF account. The VPF account will function similarly to the current EPF account.

Simple transfer procedure Employees can easily move their VPF accounts from their previous employer to their new employer if they change jobs.

Tax advantages provided by a VPF

One of the best investment options in India is thought to be the VPF account. A tax benefit of up to Rs. 1.5 lakh is available to employees under Section 80C of the Income Tax Act of 1961. Taxes are not applied to the interest that results from these contributions. However, the sum will be taxable if the interest rate exceeds 9.50% p.a.

Rate of interest on a VPF

The Indian government determines the interest rate, which is then updated annually. For the fiscal year 2021–2022, the interest rate is 8.1% p.a.From the previous interest rate of 8.65%, the interest has been lowered. A VPF account’s high-interest rate and tax advantages make investments there attractive. The interest rates for PPF and VPF are contrasted below:

Financial Year PPF Rate of Intrest (p.a) % VPF Rate of Intrest(p.a)%
2021-2022 7.10 8.10
2019-2020 7.10 8.5
2018-2019 7.6to8 8.65
2017-2018 7.6to8 8.55
2016-2017 8to8.1 8.8
2015-2016 8.7 8.8
2014-2015 8.7 8.75
2013-2014 8.7 8.75

How to withdraw funds from a VPF account

In the event of financial difficulties caused by medical problems, withdrawing money from a VPF account may be useful. Employees must submit Form-31 and a written request if they want to cancel their VPF.

Employees will be able to obtain Form-31 via the Human Resources (HR) department at their business or online through the government portal. All necessary paperwork must be submitted, along with the employee’s information such as their PF number, mailing address, and bank information. Furthermore, a voided check must be shown. All submitted documents must be self-attested.

VPF rules and regulations

The rules and regulations for the VPF account are listed below:

Employees are permitted to contribute 100% of their basic pay and dearness allowance to a VPF account, as opposed to 50% to an EPF account.

To their VPF accounts, employees are not compelled to make contributions.

The interest rate for a VPF account is set by the Indian government at the beginning of the fiscal year. When compared to prior years, the rate may rise or fall.

It is possible to withdraw the entire sum due at maturity at the moment of resignation or retirement. Also available to individuals is the transfer of VPF funds from one employer to another. The complete amount accumulated in the event of the account holder’s death will be distributed to the nominee or the legal heir.

A VPF account can only be opened by people who have an EPF account and are employed by organizations that are members of the Employees’ Provident Fund Organisation (EPFO). Opening a VPF account is not permitted for people who work for unorganized sectors.

People can open a VPF account anytime during the fiscal year. For a period of five years, investments made into the account cannot be halted.

On the VPF account, loans can be taken out in small amounts as partial withdrawals. The money that is withdrawn in cases when it is done so before the maturity period is taxable.

What is a National Savings Certificate?

Navyatha Sandiri

April 14, 2023

National Savings Certificates are a fixed-income investment product that may be opened at a post office. It is secure and a low-risk product, strategy.

The NSC system is available at all NSC post offices, and it is aggressively promoted by the Indian government. The program has gained a lot of popularity in India as a result of the country’s post office abundance and accessibility.

The main objective of the program is to motivate people to save little to medium sums of money, and it provides tax benefits for doing so. The scheme is pushed by the Indian government, thus the risks of investing in it are minimal.

Non-resident Indians (NRIs) and Hindu Undivided Families (HUF) are ineligible to participate in the plan because it was designed primarily for individuals. Those who wish to invest in the NSC plan must be Indian citizens.

NSC Qualifications

The following is a list of the requirements for investors to buy NSCs:

The involved party must be a citizen of India.
No set age limit applies when purchasing a certificate.
Indians who do not reside in India are not allowed to invest in NSC.
A person may invest alongside another adult or buy an NSC on behalf of a minor.
HUFs and Trusts are ineligible to invest in the scheme under NSC VIII Issue.

current update

Interest rates on National Savings Certificates were lowered by 110 bps.

The interest rates for modest savings schemes were reduced by the Central Government by up to 140 basis points (bps) for the April to June quarter of the current fiscal year. The National Savings Certificate interest rate was decreased by 110 basis points. From 7.9% to 6.8%, the interest rate has been lowered. A yearly calculation is made to determine the interest the scheme generates. The program is a project of the Indian government and can be registered through post offices. The plan has two maturities, each lasting five and ten years.

The program would offer tax savings of up to Rs. 1.5 lakh. The amount in the account may also be used as collateral for loans. The interest rates for micro-savings programs are updated by the government every three months. Following a recent 75-bps reduction in the repo rate by the RBI, the government opted to lower interest rates.

Features NSC

The following list includes the scheme’s key characteristics:

Investment requirements: You must invest at least Rs. 100 to obtain a certificate. The certificate comes in amounts of 10,000, 5,000, 1,000, 500, and 100 rupees. People can start out by making tiny investments and then raise them as soon as it is practical.

Maturity tenure: The two maturity durations of the plan that people can select from are 5 years and 10 years.

Interest rate: At the moment, interest is compounded annually and has been lowered from 7.9% to 6.8%. But the interest is only payable when the loan matures. A subscriber who invests Rs. 100 will, for instance, receive Rs. 146.93 after 5 years.

Nominations: The investor may add more nominations, including family members and minors. The nominee will be entitled to inherit the scheme in the event that the investor dies while the scheme is still in effect.

Transfer of certificate: The National Security Certificate (NSC) may be transferred between post offices. A certificate may also be transferred from one person to another. However, the certificate will continue to be the same, with the name of the new owner being printed there and the name of the previous owner being rounded.

Different NSC issues: At first, there were just two types of certificates available: the NSC IX Issue and the NSC VIII Issue. But as of December 2015, the Indian government had given up on the NSC IX Issue. As a result, the only publication available is the NSC VIII Issue.

Loans against NSC: The NSC may be offered to banks as security or as collateral to obtain loans. The relevant postmaster must, however, give his or her approval before the certificate can be transferred to the bank.

Purchase of NSC: After submitting the required documents, the plan may be purchased through post offices.

Benefits of NSC

The main advantages of funding the NSC are as follows:

One of the main advantages of doing so is the potential tax savings that customers may experience on their investments in the NSC. The returns under this plan are also guaranteed. Because it can provide retirees with a reliable income, the NSC scheme is well-liked.

With the exception of interest earned in the last year, the remaining interest that is generated is tax-free.

People can get a duplicate certificate if they lose their original certificate.

People have the opportunity to keep investing in the program even after it has reached maturity.

It is possible to transfer the certificate from one person to another. During the lock-in time, it is only permitted once.

The interest that is earned is compounded annually and added back into the program. The investor’s investment grows as a result without having to buy certificates.

documents needed by the NSC

The following is a list of the supporting documents needed to buy an NSC:

The submission of the NSC application is required.

For verification, investors are required to provide an original form of identity, such as a passport, permanent account number (PAN) card, voter ID, driver’s license, senior citizen ID, or government ID.

A photo must be provided by the investor.

Investors are required to produce address proof, such as a passport, phone bill, power bill, bank statement, check, and a certificate or ID card that has been issued by they also made an investment in the post office.

Tax advantages offered by the NSC

The tax advantages of NSC investments for individuals are listed below:

Under Section 80C of the Income Tax Act of 1961, you are eligible to obtain tax benefits of up to Rs. 1.5 lakh for your NSC contributions.

For tax purposes, the interest that is annually generated by NSC investments is regarded as a fresh investment.

The National Savings Certificate does not apply Tax Deducted at Source (TDS). The tax on the earned interest must be paid, nonetheless, in accordance with the marginal income tax rates.

Your credit card was Lost? Following Are Your Next Steps

Navyatha Sandiri

April 11, 2023

Whether you’ve actually misplaced your credit card or have seen unusual behavior on your records, you should take immediate action to correct the situation. You may get your money back and avoid further issues by following these same steps in each situation.

Even though we would all prefer to believe that nothing unpleasant will ever happen, it is occasionally beyond our control. It’s possible that you dropped your credit card in a cab or left it at the bar. Things do happen, but the good news is that you shouldn’t become anxious.

There is a good probability that if you take action fairly fast, you won’t need to worry too much. We’ll describe what to do in this section if you lose your credit card. We’ll also go over what to anticipate in the next days and weeks.

Take Action Immediately

The most crucial measure to take after losing your credit card may be to act right away. You can start by looking there if you have a decent notion of where you could have left your card. For instance, you can return and enquire about your card if you established a tab at a pub but forgot to get it before leaving.

But if you can’t find your credit card, phone the company that issued it as soon as possible—no later than two business days. There is a possibility that it could get into the wrong hands if you don’t know where it is. Unauthorized charges or identity theft are more likely to occur the longer it takes. If you can’t find your card, don’t hesitate to call; just do it.

Avoid Identity Theft and Unauthorized Charges

You should cancel your card and notify your bank right once if your credit card is indeed lost or if you see any questionable activity. In some situations, your bank will inform you directly of the activity, allowing you to begin the procedure there. The good news is that credit card issuers typically pay out for erroneous charges promptly, and Rathner promises you that you should receive the money returned back to your account within days of reporting it.

The ideal outcome after losing your credit card is immediately getting it back. But, there can be a period when you have trouble locating your card, necessitating further action. When you call your card issuer, it is likely that they will take action to safeguard your account, such as canceling the lost card and providing you with a new one.

But, based on how recently you misplaced the card, there are some additional procedures you might want to take. The likelihood of illegal charges or theft, for instance, will be higher if it has been a week or more. If there are any charges on your credit card statements that you don’t recognize, start there.

Call the company that issued your card right once if there are any fraudulent charges. It’s also conceivable that someone has stolen your account’s login information. To avoid any illegal access, think about updating your login information right now. Consider setting two-factor authentication and using a strong, one-time password to increase security.

You can ask for a credit freeze if you think you may have been a victim of identity theft. This will stop unauthorized individuals from creating accounts or requesting credit in your name. You might also want to report a crime to the police. This will assist in documenting the theft, and your card company could need it as part of the process for disputing any illegal purchases.

To replace a lost card

You might need to order a new card to replace your missing one. If you typically use the card you lost, prepare alternative plans since it may take 7–10 business days for new cards to arrive. There are a few things you may need to do even after requesting a replacement card.

For instance, the missing card may be set up with automatic payments. If so, inform them of the new card information. You might want to temporarily move any payments that will be processed in the next several days to a different payment method. By doing this, you can prevent missing any subscriptions or payments while you wait for your replacement card.

Take Steps To Prevent Future Losses

It’s possible that losing a credit card will make you feel humiliated or even embarrassed, but it’s best not to let such sentiments persist. Instead, see this as a chance to defend yourself. Use these instructions to assist avoid losing your credit cards in the future:

Cards should always be stored securely so that others cannot easily access them. If you keep them in a worn-out wallet that doesn’t adequately protect them, think about getting a new one.

Don’t give out your card number or PIN: Don’t give out your card number or PIN to anyone. Your card number could occasionally be required while making purchases, but keep it private unless absolutely necessary.

Use digital wallet and contactless options: Contactless and digital wallets are your greatest bets for protecting your credit cards. They frequently let you make purchases without disclosing your card information to retailers.

Conclusion

Dont, get panic when you lost your credit card. Follow the steps from bankmybank site to take immediate action and prevent any unauthorized activity of credit cards and losses.

What is Maestro, and what sets it apart from Mastercard?

Navyatha Sandiri

March 24, 2023

Maestro and Mastercard are two well-known brands in the debit and credit card industry. You can choose the card that best suits your lifestyle by knowing their similarities and distinctions.

The differences between Maestro and Mastercard are discussed in more detail below. Also, you’ll learn how to purchase a new card and begin using its advantages.

Maestro: What is It?

Mastercard is the company that issues debit cards under the Maestro name. 1991 saw the brand’s introduction by Mastercard.

The first debit network for point-of-sale transactions online was Maestro. For the first time, cardholders in Europe could use their debit cards practically any place. Money can be taken out of ATMs and paid for in-store using Maestro.

Online purchases are possible with several Maestro cards.

It is also the sole card that may be used to make payments in the Netherlands, as any Dutch person will know.

Mastercard vs. Maestro

A Maestro debit card is issued by Mastercard. It seems to sense that the two could be confused. The primary distinction is the kind of card each brand offers.

Debit cards include Maestro. It can be pre-paid or connected to a bank account. Although Maestro cards are often referred to as credit cards, they are all fact debit cards.

A Mastercard can function as a prepaid, bank debit, or credit card.

Credit versus Debit versus Prepaid

Prepaid and debit cards function essentially in the same way. Cardholders can use the funds in their account to make purchases. This is a bank account when used with a typical debit card. In the case of a prepaid card, it is the funds stored on the card.

Direct withdrawals or payments are made from the available funds.

The operation of a credit card is distinct. Once a month, the cardholder receives a bill or invoice from the bank, which settles transactions as they happen. In essence, the bank or credit card company is lending the money to the cardholder.

How do Maestro debit cards function?

Like a Mastercard debit card, a Maestro debit card functions in the same way. Any type of card can be used to make in-store purchases or withdraw cash from an ATM by cardholders.

The same security measures as Mastercard are used when Maestro cards are used for online purchases. The Mastercard SecureCode system will add a second stage for identity verification for the customer. The verification mechanism is frequently a one-time passcode.

Beyond the predetermined limit, card payments require the cardholder’s signature or PIN. In an ATM, the PIN is always required to withdraw cash. Contactless payments are supported by both Mastercard and Maestro cards.

Where to use Mastercard vs. Maestro

There are about 400 million Maestro cards in use worldwide. Maestro is particularly well-liked in Europe. Germany, Austria, the Netherlands, Belgium, and Switzerland are some of the biggest marketplaces in Europe.

Maestro’s network is just half as big as Mastercard’s. More e-commerce transactions are supported by it. Many e-commerce portals are incompatible with the format of Maestro card numbers, which can have up to 19 digits.

The Mastercard and/or Maestro logos are frequently displayed on the doors of stores to indicate that they accept these cards. At checkout, online retailers frequently display card logos.

You can use a Maestro card to access the Cirrus network of Mastercard ATMs. One of the biggest networks in the world is Cirrus. Millions of ATMs worldwide offer secure cash withdrawals for holders of Maestro and Mastercard cards.

Benefits of using a Maestro debit card

Maestro cards are accepted by shops and ATMs everywhere. Maestro is a wonderful option for folks who live in or will be traveling to Europe because of its popularity.

For managing a budget, debit cards like Maestro have several benefits. Using debit cards instead of credit cards is frequently advised in personal financial advice since you won’t run the risk of accruing debt.

Direct debit from the cardholder’s account is used for purchases. Spending tracking is simpler. When there is no other money available besides what is in the account, the incentive to overspend is reduced.

When traveling, using a debit card can be advantageous. Less tangible cash needs to be carried by cardholders. According to numerous travel advice articles, this is financially and personally safer.

The amount of money in the account can only be used if a debit card is lost or stolen. Nobody wants to experience the anxiety and inconvenience of illicit purchasing. At least the damage won’t be as severe as if a credit card were stolen.

The benefits of a Mastercard

You can choose a credit or debit card from Mastercard. Debit cards have a lot of benefits. Yet, using a credit card can be a smarter move if you’re making bigger purchases or booking rooms.

One of the two biggest payment processing networks in the world is Mastercard. Mastercard is accepted almost everywhere that accepts credit or debit cards. Cardholders can buy nearly anything online using their cards.

Future of Maestro cards

Despite the many advantages of a Maestro card, Mastercard will no longer offer the product. The major motivation, according to a statement from Mastercard, is to increase cardholders’ capacity to make online purchases. The number of locations where cardholders can use their new debit cards both online and offline will increase significantly.

By July 1st, 2023, banks and card issuers will begin replacing lost or expired Maestro cards. A Mastercard debit card will be the typical alternative.

The updating of a card does not require any activity on the part of the cardholder. They will receive a new debit card from their bank when their Maestro cards expire after July 1, 2023. The new card will function similarly to the Maestro debit card and be connected to the same account.

How to apply for a Mastercard or Maestro

Cards are not directly issued by Mastercard. Bunq offers Maestro or Mastercards that you can use with your account. The procedure is easy:

Activate the Bunq app.
Click “Cards”
Choose either “Add Credit Card” or else select”Add Debit Card” and then click next.
Select the desired card.

Within ten business days, the card will be received by mail. You may then start using mobile payments by simply connecting it to Apple Pay or Google Pay.

Describe a bank statement and how to secure a Bank statement

Navyatha Sandiri

March 18, 2023

The activity on your account over a specific time period—typically one month—is summarised in a bank statement, an official document. Every transaction—both incoming and outgoing—is documented, allowing you to know exactly what occurred to your money during that time frame. Bank statements are an essential tool for account holders to track their finances, examine their spending habits, and spot possibly fraudulent behavior or payment issues. How are bank statements made?

Each transaction you make is documented by your bank. A bank statement is then produced by compiling these records. Statements typically include your incoming salaries or payments, any transfers or deposits, and cash withdrawals over the course of a month. They also offer a starting and ending balance so you can see exactly where your money is at the end of the month compared to the beginning.

What details are included on a bank statement?

Your account number, the bank branch provider, your full name, your home address, and the start and finish dates of the statement are typically located at the top of the statement. The complete list of transactions that occurred during the period covered by the statement is found next; this includes both payments that were made into and payments that were made out of your accounts. Each transaction includes the date it was processed as well as possibly some information about the recipient or sender of the money.

How to get access to your bank statements

In the past, consumers received bank statements through the mail, which occasionally came with a small service charge. Electronic statements are now used more frequently because the majority of banks have a digital presence.

Your financial information is securely saved, and e-statements offer a quick way to view your account activities without the clumsy paperwork. Some banks let you examine your statements directly through your online account or mobile app, or you can choose to get emails with them attached.

Utilizing bank statements as legal documentation

As formal documentation for verification, bank statements can also be used. Your bank statement is a useful source of information to confirm your identity and provide evidence of your income, for instance, if you ever need to apply for a personal loan.

In case you ever need to refer to your financial records, it is always a good idea to maintain copies of your bank statements. Never fear if you can’t find them. At goodness, your bank is required by law to keep your statements for at least five years.

Using bank statements to establish savings objectives

A fantastic technique to find areas where you may save costs is to use your bank statement to evaluate your spending patterns. You can see where you could stand to cut back or adjust your spending patterns by taking a complete look at your spending.

Checking for fraud on bank statements

Yet as technology has developed, it has gotten simpler for fraudsters to make false bank statements that look real. An applicant’s income and financial stability may be fabricated using these fictitious bank statements, giving the impression that they are more creditworthy than they actually are.

For lenders and consumers alike, using phoney bank statements in loan applications can have dire repercussions. False claims can be used to exaggerate earnings, conceal debts, or portray the borrower’s financial status as better than it actually is. This might result in creditors giving credit to those who can’t truly pay back the debt. Furthermore, if lenders don’t thoroughly check the data on a phoney bank statement, they risk legal repercussions.

All paper records should be kept in a secure location in your home that is out of the way and out of harm’s way to prevent destruction or theft. Be cautious about backup and archiving all electronic records that are digital. It makes sense to password-protect these documents.

securing your bank statements

Safeguard your passbooks, checkbooks, and ATM cards.

Often change the passwords for your banking and card applications. It does not take long.

Keep your bank updated with your phone number and email address. Your bank keeps you informed of any account activity.

Use online transaction platforms responsibly at all times. It is a wise decision to conduct business exclusively through reputable online platforms.

Update your passbook as necessary.

To be informed about the balance and activity in each of your accounts, use the M Passbook application from our bank.

Keep your debit and credit cards to yourself.

Don’t give anyone your personal information, including your debit card data, PIN, CVV, OTP, card expiration date, and UPI pin, through phone, email, or SMS, even if they are posing as bank representatives. Your bank never asks customers for such information.

Don’t click on unfamiliar links that are provided to you by SMS or email.

Installing software that enables remote control of your laptop or mobile device is not recommended.

Fraudsters may approach you with enticing promises like lottery tickets, free loans, KYC updates over the phone, COVID-19 vaccinations, and other things in order to obtain your account or card information. Don’t provide any information to them. Your bank account information is not needed for such things.

Don’t save your password in your phone’s contact list. Sometimes, the convenience it offers is more expensive than the product’s cost.

Best ways to send money For teens

Navyatha Sandiri

March 14, 2023

Easy Way to send money For teens, You may quickly send money from your mobile device to friends, family, or other people using payment transfer apps. There are many choices available to teens who want to send money online. It’s critical to comprehend the costs and risks of all your options before transferring money to a teen.

What Digital Money Transfer Means

Digital payments are the movements of money between accounts that take place electronically. A mobile device, computer, point-of-sale (POS) terminal, or wire transfer network can send and receive electronic payments.

No money is exchanged when you submit a digital payment. You’re approving the transfer of money from your account to someone else’s account through a bank or money transfer provider. For a digital payment to be processed,

the sender of the payment, or the payer.

Payee: The individual or company who will receive the payment.

Relationship between the sending and receiving banks that make up the payment network

The general flow of digital payment is as follows:

A payer starts a payment by instructing their bank where to send the funds and how much to transfer.

The data is sent to the payment network together with the recipient’s bank account number and routing number.

The transaction is authorized when the information has been verified by the payment network.

From the bank of the payer to the payee, money is electronically transmitted.

Digital payments come in a variety of forms, such as Automated Clearing House (ACH) transfers, mobile wallets, contactless transactions, inter-person transfers, money transfer apps, and wire transfers. You don’t need to make a bank withdrawal or write a check to use these transfer options.

Best Methods for Teens to Send Money

Teens have a variety of alternatives for sending and receiving money online. Depending on your age and possession of a bank account of your own, some may be more advantageous than others. You can learn how you might want to send money as a teen by contrasting several internet methods of sending money.

Money App

Users in the US and the UK can send and receive money from their mobile devices using the Cash App mobile payment app.

With your individual $Cashtag, you can instantaneously send money to others or request money.

For in-person or online purchases, Cash App also provides a debit card that you may link to your account.

Anybody who is 13 years old or older can apply for a Cash App card, and teens between the ages of 13 and 17 can use Cash App features with parental or guardian consent. Only Americans are eligible for such benefits.

Venmo

A digital wallet called Venmo makes it simple to send or receive money.

Reside in the U.S.

possess a U.S. cell phone with text messaging capabilities

are of legal age in their state, which is at least 18 years old.

If you want to avoid paying exorbitant money transfer fees as a kid, Venmo is one of the finest options. When you send money using a debit card, bank account, or Venmo balance, there are no transfer costs. There are also no monthly fees, fees for online purchases, or fees for using your Venmo balance as a payment method.

Google Pay

Google’s mobile payment platform is called Google Pay. It allows you to transmit money from your computer or mobile device to make purchases. Teenagers who are 13 years old or older can use Google Pay to send and receive money as well as to make in-app, online, and retail purchases.

If you want to send money using Google Pay, you’ll need:

access to the internet
a telephone number
E-mail address

To send money if they don’t have any in their Google Pay balance, teenagers will also need a bank account or debit card that they can add to the Google Pay app.

Zelle

If you have the other person’s email address, phone number, or account number, you can use the person-to-person payment software Zelle to send money from your bank account to their bank account.

For teens who have a bank account with Zelle as a feature, there is an exception to the requirement that you be at least 18 years old to utilize the service. You can use Zelle to send and receive money, for instance, if you have a Capital One Money Teen Checking Account and are at least 13 years old. Unless your parent or guardian requests that Capital One lower that cap, you are only allowed to send up to $500 every day through Zelle.

Walmart Money Card

A Walmart MoneyCard is a bank account substitute that enables mobile device and in-store money management. The Walmart MoneyCard can be used to transfer and receive money, pay bills, make purchases, and get direct deposits of pay.

To purchase and use a Walmart MoneyCard, you must be at least 18 years old. Nevertheless, if you are at least 13 years old, your parents can set up a Family Account and enroll you so that you can have a Walmart MoneyCard of your own.

Wire Transfer

Any electronic money transfer over a wire transfer network, like SWIFT, is referred to as a wire transfer. There are several methods for sending wire transfers, including:

Western Union and MoneyGram are examples of wire transfer services.

Websites that facilitate wire transfers

banking wire transfer

The best method for sending money abroad or locally can be a wire transfer. Your age may have an impact on the best decision for you. Western Union and MoneyGram require that you be at least 18 years old to send a wire transfer. Often, the age cutoff for online transfer services is the same.

If you’re under 18 but have a teen checking account, your bank might let you send a wire transfer. Depending on the bank, you may be able to send both domestic and international transactions. For individuals 13 and older, Wells Fargo has a teen and student checking account that enables domestic wire transactions.

Definition of a Demand Deposit, Types of Accounts, and Criteria

Navyatha Sandiri

February 28, 2023

A Demand Deposit: What Is It?

A bank account known as a demand deposit account (DDA) enables unauthorized withdrawals of funds at any time. DDA accounts can choose to pay interest on the money placed in them; this is not a requirement. Savings and checking accounts are the two most prevalent DDA types.

How Demand Deposits Work

It would be difficult to obtain cash or conduct routine business if depositors had to notify their banks in advance of any withdrawals. Demand deposit accounts are designed to deliver quick cash—the money consumers require to make purchases or pay their debts.

The account’s assets can be accessed whenever you want, without giving the institution a heads-up. As long as the account has the necessary amount, the institution is required to release it to the account holder. The account holder can simply walk up to the teller, the ATM, or—more and more—go online and withdraw the required amount. Due to the fact that the funds are accessible “on demand,” this type of account is known as a “demand deposit.”

Unlike investment accounts, which are primarily provided by brokerages and financial services companies, demand deposit accounts are typically provided by banks and credit unions. Even though the money may be in highly liquid assets, the account holder must still let the institution know that they want to withdraw money. Depending on the asset, it can take a day or two for the investments to be sold for the money to become available.

As a withdrawal from an account to pay for a good or service, “DDA” can also stand for direct debit authorization. It happens when you make a debit card purchase. The money is immediately accessible and pulled from the associated account for your usage, but the basic idea is the same.

Special Considerations

Demand deposit accounts (DDAs) could have joint proprietors. While starting the account, both owners must sign; however, only one owner needs to sign when terminating the account. Without the other owner’s consent, either owner may deposit or withdraw money and sign checks.

Demand deposit accounts have minimum balance requirements set by some banks. Every time an account’s balance falls below the necessary level, a fee is normally assessed. Yet, many banks these days don’t charge monthly fees or require minimum balances.

Demand Deposit Account Types (DDAs)

Although they can also incorporate savings accounts, DDAs are typically checking accounts. Money market accounts (MMAs) fall into the following categories: Several financial authorities categorize them as DDAs, whereas others do not.

Demand deposit accounts in the United States totaled $4.98 trillion as of May 2022; this figure is known as the total demand deposits component of M1. This contrasts with $733 billion and $1.4 trillion, respectively, five and ten years ago.

The conditions for demand deposits

There are no restrictions on withdrawals or transfers, there is no specified maturity or lockup time, money is available immediately, and there are no qualifying conditions.

It is left to each institution to decide how much interest is paid on the DDA and how much interest is paid. Banks used to be unable to pay interest on specific demand deposit accounts. For instance, the Federal Reserve Board’s Regulation Q (Req Q), which was passed in 1933, expressly forbade banks from paying interest on deposits made into checking accounts.

By using checking accounts with a temporary holding period on funds, known as negotiable order of withdrawal (NOW) accounts, many banks were able to circumvent the requirement and continue to pay interest. In 2011, Reg Q was revoked.

Despite this, DDAs typically pay either very little or no interest (as is frequently the case with checking accounts, Reg Q’s repeal aside). For managing the account, they may also charge a variety of fees.

Term Deposit versus Demand Deposit

Banks and credit unions provide two different types of financial accounts: demand deposit accounts and term deposit accounts. Yet, they vary in terms of availability or liquidity as well as the rate of interest that may be paid on deposited funds.

In general, a DDA permits access to funds at any time, whereas a term deposit account, often called a time deposit account, restricts access to funds for a set period of time. Without incurring a financial penalty, funds cannot be removed from a term deposit account until the end of that period, and withdrawals frequently necessitate written notification in advance.

The Certificate of Deposit is the most popular type of term deposit account (CD). You purchase the CD for a predetermined amount of time—say, a particular number of months or years—and typically don’t use it until that time has passed. It is kept in a particular account where it accrues interest at a set rate.

The second key factor separating demand deposits from term deposits is interest. Interest rates on term deposits are often higher than DDAs and significantly nearer to current market rates. Basically, it is the trade-off: Your money yields less in a DDA in exchange for the flexibility to access your money whenever you need it. The time deposit compensates for its lack of liquidity by paying more.

What part do money market accounts (MMAs) play in this scenario? They are a mix. They typically pay market interest rates and let account holders deposit and withdraw money whenever they want (it fluctuates). They may not, however, be as on-demand as standard demand deposit accounts. With MMA accounts, certain banks may have monthly withdrawals or other transaction limits. If the limit is exceeded, fees might be charged.

What does DDA mean on a bank statement?

DDA stands for “demand deposit account,” which denotes that the money in the account (often a checking or ordinary savings account) is available right away, or “on demand.” DDA can also stand for “direct debit authorization,” which refers to a transaction that directly deducts money from the account, such as a transfer, cash withdrawal, bill payment, or purchase.

A Consumer DDA Account: What Is It?

Demand deposit accounts are called consumer DDAs. You can withdraw money from such an account without informing the banking institution in advance.

What Distinguishes Time Deposits from Demand Deposits?

Demand deposits are sums of money that the account holder can withdraw immediately, like money from a checking account. Time deposits or term deposits, like certificates of deposit (CDs), are locked for a set period of time.

What Benefits Do Demand Deposit Accounts Offer?

Funds are always accessible with demand deposit accounts. Without giving the bank notice, incurring a penalty, or paying any fees, you can take the money at any moment and use it to pay for something (with a debit card or online transfer) or withdraw cash. For acquiring cash or moving money to another account or another person, they provide the highest convenience.

conclusion

Demand deposit accounts, which are provided by banks and credit unions, let you deposit money and withdraw it whenever you want, or “on demand.” Before allowing you access to the cash, the financial institution is not permitted to impose a fee or require prior authorization. Perfect for routine or everyday use. The typical form of a DDA is a checking or savings account.

DDAs’ primary flaw is that they provide little or no interest on the money invested in them. You pay that as a price for the funds’ ready access.

What exactly is banking, and why is it important?

Navyatha Sandiri

February 25, 2023

It’s possible that you have never considered the benefits of having a bank account, regardless of whether you are opening your first account or opening your first bank account in the United States. One was just opened.

That subject becomes more intriguing now that there are other ways to obtain money and pay bills. Do you actually need a bank account given the fees and inconveniences associated with having one? Explore this query by reading on.

Why Would You Use a Bank?

If you have never used a bank before or if you have lived in a nation where the banking system is unreliable, you might be wondering why you would want to do so at all. Surviving without a bank account is undoubtedly simpler than ever.

Users of prepaid debit cards can make purchases offline and online, pay bills, and withdraw cash from ATMs just like they would with a typical bank account. Both the IRS and many businesses will load your paycheck onto a prepaid debit card when you receive your tax refund (though this option has many drawbacks).

KEY TAKEWAYS

Banks are businesses that lend money and take deposits.

Given current technological advancements, many individuals question if a traditional banking account is actually required.

Prepaid debit cards are frequently used for online shopping and ATM withdrawals, while online payment systems like PayPal can be used to send money.

Security, convenience, and the potential availability of alternative investment options are benefits of using bank accounts.

Some banks that exclusively accept payments online have lower fees and greater interest rates than conventional brick-and-mortar banks.

You can send and receive money using online services like PayPal and Venmo without having a bank account. By cashing your paycheck at Walmart or a check-cashing business and paying your bills in person at a Walmart Money Center or a check-cashing business, you may also run an all-cash system.

Yet, if you have minimal requirements for opening a bank account, you might value the various advantages of a bank, starting with the improvement of your financial security.

1. Bank Security

It is risky to keep all of your cash at home. There is a chance that your house will be broken into. A child, relative, or acquaintance who is familiar with you and knows that you store your money at home could steal from you. Most of the locations where people hide their money are known to be burglary targets. Even worse, you might be robbed at home.

Another risk is that your money could be lost in the event of a fire or flood, and homeowner’s insurance only covers a portion of lost funds. If you bury it in the backyard, the container it was placed in can get broken or start to rot, which would ruin your money. You can also simply lose track of where you’ve hidden your money. Did you smuggle that $100 into your favorite book on page 52, tape it to the back of the family photo in your bedroom, or bury it in an oatmeal tin at the back of the pantry? It’s also less secure to store all of your money on prepaid debit cards than at a bank.

When you’re living paycheck to paycheck, the most you’re ever at risk of losing or having stolen is the amount of your most recent salary, which, if money is tight, you obviously can’t afford to lose. It is crucial to protect your money. Whenever you have more than a few hundred dollars in your account, you should start thinking about protecting your funds.

Your money is safest kept in a bank account. Your deposits are insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Association (up to the FDIC insurance limitations) if you choose a reputable bank with one of these insurance programs.

Even through financial crises like the 2008 recession and the savings-and-loan crisis of the 1980s and 1990s, the FDIC’s guarantee has so far proven to be completely reliable.

2. Bank Convenience

When you have money in the bank, you may access it from anywhere—online, across town, even abroad—in person at your neighborhood branch, at the grocery store’s ATM, and so on. A checking account also makes paying bills much simpler and less expensive. You won’t need to go to a store, check-cashing facility, or service provider’s office to send payments, and you won’t have to buy a cashier’s check or pay a transfer fee to transmit those payments.

Instead, you can utilize the free online bill-pay option offered by your bank, or if you’d rather handle things in a traditional and less secure manner, you can write a check and send it, which is also free minus the cost of postage. The advantages of employing a bank to safeguard your funds are comparable to those of a credit union.

3. Investing and saving

Whenever your income exceeds your monthly expenses, you should start saving and investing your money in order to increase your financial stability. This means moving beyond a checking account.

If you have money saved up, you can handle sporadic costs like auto repairs even if they don’t fit into your monthly spending plan. You can survive a period of unemployment if you have a sizable emergency fund. And if you have enough emergency funds to last for several months, you should move your surplus funds into a retirement account.

If you only want to keep your money in your mattress or on a prepaid debit card, you simply can’t take advantage of the chance to make money in the stock market or earn interest on deposits.

What is a salary account and what are its main advantages?

Navyatha Sandiri

February 21, 2023

A salary account is one of the types of accounts available to those who are salaried. The employer explicitly uses this account to credit the employee’s salary to the employee’s bank account.

Employers utilize these accounts to distribute reimbursements, bonuses, perks, and other forms of cash compensation in addition to the employee’s normal paycheck.

A specialized employee bank account has two advantages:

A single account is used by an employee to receive payments such as their monthly wage.

Free debit cards, money-saving vouchers, and other benefits are among the extras that an employee receives.

Who has access to a salary account?

If a person is not already employed, they are not permitted to open a salary account in their name.

The establishment of a corporate salary account for a worker is possible.

The business must work with a bank to establish salary accounts for every employee. The specific sum is subsequently paid each month to each bank account by the HR department.

Why does a corporation give its employees salary accounts?

Even though employees have bank accounts, companies insist on setting up salary accounts for each employee.

For businesses, setting up and managing numerous accounts comes with a lot of work and expensive expenses.

So why do businesses insist on setting up separate salary accounts for employees?

The following are some advantages of a paid account for employers:

employers won’t find it challenging

Every employee should have their own bank account, which aids in overall management and maintenance.

Because to the fact that their funds are in one bank, they may rapidly receive the money without incurring any transfer fees, enabling them to quickly credit the wages all at once.

advantages of a salary account for employees

1. Internet banking services

Employees are able to access online banking services including mobile/phone banking and net banking thanks to salary accounts.

These services allow employees to deposit their pay into their bank accounts.

2. Online money transfer

Your employees can move money locally using fund transfer techniques thanks to the bank account.

International transfers may be subject to limits, however, these depend on the company’s chosen plan.

3. Demat services and accounts

Workers can open a Demat account to begin their path into trading and investing.

Employees are not responsible for annual maintenance fees because the firm sponsors the account. Yet this differs from bank to bank as well.

Demat services are not available on all bank accounts for employees, though.

4. Services for loans

Contrary to popular belief, salary accounts permit employees to apply for personal loans; many individuals mistakenly believe that these accounts are not eligible for loans.

According to the employee’s net pay, the bank will select the amount that will be sanctioned.

Additionally, the sum will be automatically deducted every month on a predetermined date until the end of the tenure.

5. Credit cards

Also, the staff members are qualified to apply for a credit card. The quantity of credit offered is determined by the employee’s credit rating.

6. Utility payments

Workers can utilize their salary accounts to pay for necessities like energy bills, mobile recharges, WiFi prices, and other daily expenses.

Considerations to make when selecting a salary account

By making it simple to use its services, an all-purpose salary account raises employee happiness.

Need for a minimum balance

In order to avoid further fees, bank account holders must consistently maintain a particular balance.

The requirement to keep a balance is not applicable to nearly all salary accounts, though. Zero balance accounts are the name given to these accounts.

Workers are not required to keep a minimum balance and may withdraw their entire paycheck without incurring any penalties.

Interest rates

Every paid account has a fixed interest rate because it doubles as a savings account.

A certain rate of interest is charged on salary accounts, and this rate varies from bank to bank. Either quarterly or yearly payments are made for the interest.

Because of this, find out about interest rates and other fees before choosing a bank account.

loans available

Employees with salary accounts may be eligible for loans from certain institutions. It’s usually a good idea to work with a bank that provides them with simple loans with fair interest rates and minimal paperwork.

digital accessibility

The advantage goes to banks that provide online customer assistance and services over those that only conduct in-person interactions.

Employees should be able to contact their relationship manager with ease and find a solution online if they have problems with their bank accounts.

offering rewards

Employees can save a sizeable amount of money each year with the use of salary accounts that offer reward points, cashback, and vouchers.

Difference between a salary account and a savings account account

To credit the employee’s salary, a corporation establishes salary accounts. This account contains extra features only available to those in the salaried class and a zero balance requirement.

Anyone can open a savings account to deposit money and save it; employment is not required.

How do salary and savings accounts vary if they have essentially identical features?

Payroll transfers and other financial operations are the main reasons for creating salary accounts.

To simplify transfers and ensure consistency, businesses have all of their corporate accounts in the same bank.

Savings accounts are established to deposit a person’s money so they can receive interest on them.

This account’s primary goals are to promote saving habits among users and facilitate simple money management.

Minimum required balances

Salary accounts don’t need to have a certain minimum balance. Employees are free to withdraw their entire salary after receiving it without incurring any fees.

There is a minimum balance requirement for savings account holders at commercial banks. The balance varies by bank and is subject to penalties if not maintained.

Convertibility

If no money has been deposited for three months, a salary account is automatically changed into a savings account.

All of the savings account features, including the minimum balance requirement, will be applied once the account has been converted.

If a savings account complies with the bank’s requirements, it may be converted to a salary account.

The bank may think about converting your savings and salary accounts if they are both with the same institution.

How to Choose a Bank

Navyatha Sandiri

February 18, 2023

The majority of folks won’t have any issues choosing a reliable bank if they use a little common sense. Although it’s true that even well-known banks can fail (as Washington Mutual did in 2008), FDIC insurance will safeguard your funds in certain circumstances.

Each owner and per account, it offers $250,000 in coverage.

So, a balance of up to $500,000 would be protected if you and your spouse have a joint account.

The American system should be a huge relief if you’re from a developing nation without deposit protection, where you couldn’t trust that your money was safe in the bank.

When deciding where to bank, it is difficult to make a significant error, but some options are preferable to others in terms of convenience, costs, and interest rates. The following are the main considerations you should make when deciding where to open a checking account.

Legitimacy and Reputation of Banks

You should, first and foremost, use an authorized bank. Maintaining a relationship with a large, well-known bank is advised. Use the Bank Locate tool on the FDIC website to confirm if the bank is a member of the FDIC, which implies that your deposits will be protected up to FDIC limits if you’re thinking about a smaller institution or if you just want to be extra safe.

It can be more difficult to select a bank with a solid reputation. In order to meet sales targets and collect bonuses, 5,300 Wells Fargo employees opened 2 million unauthorized bank accounts for the company’s customers in 2016.

These clients ultimately had to pay fees on such accounts. Currently, the bank is attempting to reposition itself as “re-established.”

Additionally, Chase Bank has recently paid fines and settlements totaling hundreds of millions of dollars for bribing foreign officials, manipulating interest rates, and other wrongdoings.

These are two of the most well-known instances of enormous bank misbehavior, though they are not the only ones. In summary, before choosing a bank, you might want to examine its reputation.

Online-only versus physical banks

The choice between a bank with only an online presence and one with both a physical location and an online presence is one of the most important ones you’ll have to make. No matter which bank you choose, you will have access to features like online bill payment, mobile check deposit, and apps that let you bank whenever and wherever you want from your computer, tablet, or smartphone. This is because most banks today have a strong online presence even if they originally started as brick-and-mortar institutions.

What are the key distinctions between banks where you can visit a branch and speak to a teller and banks where everything is done online only? Fees and interest rates are typically involved. Due to their lower operating expenses, online-only banks can offer higher interest rates on savings accounts and certificates of deposit. These banks can pass these savings along to their customers by eliminating monthly maintenance fees and minimum balance requirements. The well-known names in online-only banking include Ally Bank, Discover Bank, and Capital One 360.

However, community banks will occasionally provide you with the same lower-fee, higher-rate benefits as online-only banks while also allowing you to speak with a banker in person. Don’t discount them without checking because you might also locate low-fee accounts at a sizable traditional bank.

What would you find convenient and comfortable about banking?

Which would you choose: interacting with a machine or speaking to a real person?

Would you rather pay your expenses online than be able to write a lot of checks?

Do you typically make cash deposits? (With an online bank, this is difficult to accomplish; you’ll need a specialized ATM, a money order, or other middlemen.)

When is the most convenient time for you to visit the bank—what day of the week and what time of day?

Bank Size and Location

For the convenience of visiting a teller and making deposits and withdrawals, the majority of people who want an account at a physical location prefer to use a bank that has a branch near where they reside or where they work. If you don’t travel often, it might be a big national bank or a little regional or local bank. If you do travel regularly, you should do some investigating to find out which banks have locations near the places you frequent the most. You’ll need quick access to your money while you’re away from home, the ability to speak with a live person in person if you run into any problems, and no service charges for using non-network ATMs.

The other important factor in size is whether smaller banks may provide better customer service and show greater interest in the communities in which they operate. But, as there is no set rule, your best option if these aspects are significant to you is to visit the bank in person and gauge your experience there.

You will normally have access to a countrywide network of fee-free ATMs if you choose an online-only bank. Also, your bank might pay back a limited amount of out-of-network ATM costs each month.

Deposit fees

As long as your account balance is positive, you can use some banks for free, while other banks nickel and dime their customers with fees at every turn. Before opening an account with a bank, thoroughly review the fee schedule and make sure you know what you need to do to avoid any fees. Even modest fees can accumulate over time and eat into your account balance.

This advice is still valid even if you choose a bank that promotes free checking because there are always expenses involved. Fees could apply if you close your account, allow your balance to fall below a specific level, overdraw your account, use an ATM, request printed statements, or let your income not be instantly transferred into your account.

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