Banking and digital banking basics

Savings vs checking accounts

A savings account is built for holding money you don't plan to spend right away. It usually pays a small amount of interest, computed daily on your balance and credited monthly, comes with an ATM or debit card, and often limits how many withdrawals or transfers you can make in a month before fees kick in. For most individuals, it's the default account for everyday saving. The interest you see quoted is also a pre-tax figure: banks automatically deduct a 20% final withholding tax on savings interest before it ever lands in your passbook or app balance, so the actual amount credited is a little lower than the advertised rate implies.