Last Updated: February 14, 2023, 13:40 IST
Savings accounts have a minimum balance requirement, even for children.
The child will also receive an ATM/debit card for access to the account but it will have a lesser financial limit than a typical Savings account.
Parenting involves both joys and duties. And while you may try your best to instil in your kids a sense of morality and the value of education, there is one more thing you shouldn’t forget to teach them: proper money management.
This usually starts with the idea of saving. And one step in that direction is to open a savings account for your child while he or she is still a minor. A savings account for those under 18 has the same minimum balance requirements as conventional savings accounts. It also has options and restrictions that you, as the kid’s parent or guardian, can use to assist the youngster in learning how to handle their money.
Savings accounts have a minimum balance requirement, even for children, as was previously mentioned. Additionally, the account has a maximum balance, after which the bank would often deposit any additional funds (which exceed a specific limit) into a Fixed Deposit account in the minor’s name for a year.
With the opening of a bank account, the minor will also receive an ATM/ debit card to access the account. Here is the twist, the card issued to a minor will have a lesser financial limit than a regular saving account. This step by the bank can ensure access to funds for a child at the same time remaining under parental guidance. Additionally, as the minor’s joint account holder, you will receive notifications of any transactions they make.
Procedure for opening a minor’s savings account
To open the child’s savings account, the parent must have a savings account there in her or his name.
The kid must be listed as the primary account holder on the application and the parent must be listed as a joint account holder.
Along with this form, the parent must submit their photos as well. Some banks also request a picture of the minor.
As proof of the child’s age, the parent must produce the birth certificate. The child must be younger than 18 years. This is necessary to verify the relationship with the minor as well as to prove your age.
Parents must also submit their personal information, in particular, their PAN card information. You can be questioned in this situation as the parent or guardian.
Parents might also be required to fill out a second form with their details. They must also provide address verification for the minor to the bank.
The bank will then request the parent’s signature before completing any further procedures. After everything has been completed and validated, the account is created, and the bank will deliver the relevant documentation. A chequebook will also be supplied to the minor.
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