Kotak Mahindra Bank has launched ActivMoney, a feature that automatically transfers excess funds in the account into a fixed deposit, allowing customers to earn up to 7% p.a. interest while retaining the flexibility to access their funds anytime without penalty.

Kotak Mahindra bank introduces ActivMoney: A paradigm shift for India’s savings culture

Kotak Mahindra Bank Limited has launched its ActivMoney feature, designed to revolutionize the savings culture in India. ActivMoney automatically transfers any excess funds in a customer’s account beyond a defined threshold into a Fixed Deposit, ensuring they earn a higher interest rate of up to 7% p.a. for 180 days. With no premature withdrawal charges, customers have the flexibility to access their funds at any time, making banking more rewarding and helping them to use their savings more efficiently.

According to RBI data, the cumulative Savings Account deposit of all scheduled commercial banks in India as of March 2023 was Rs 62.9 lakh crore. However, the industry average interest rate of 3.5% p.a. on these deposits pales in comparison to the potential returns offered by other instruments like Fixed Deposits and Liquid Funds.

With ActivMoney, Kotak Mahindra bank is offering customers FD wala interest rate on their savings account while retaining the flexibility to access funds anytime without any penalty on foreclosure. This move is a game-changer for Indian savers, who now have an opportunity to earn significantly higher interest rates on their savings without sacrificing accessibility.

Virat Diwanji, Group President and Head, Consumer Banking at Kotak Mahindra Bank, says that customer-centric products and services are at the core of their business strategy. They aspire to change the paradigm of savings culture in India by providing customers with the best of both worlds. ActivMoney provides the opportunity to earn a higher interest rate on savings while retaining the flexibility to access funds when needed.

Rohit Bhasin, President – Retail Liabilities Product and Chief Marketing Officer at Kotak Mahindra Bank, commented that their ActivMoney feature fulfills the needs of young, aspirational consumers seeking higher returns on their savings. ActivMoney makes banking more rewarding and enables consumers to use their savings more efficiently and effectively.

The default minimum threshold for ActivMoney is set at Rs. 25,000 for Savings/Salary/811 accounts and Rs. 50,000 for Current accounts. This feature is available to all Kotak Mahindra bank customers, including 811 and Current Account holders. New customers can avail of this facility when they open an account online via www.kotak.com or by visiting the nearest branch while existing customers can sign up through mobile banking shortly or the nearest branch.

Kotak Mahindra bank‘s introduction of ActivMoney is a significant breakthrough for Indian savers. It enables them to earn higher interest rates while still retaining the flexibility to access their funds when needed. This is a promising development in India’s financial landscape, and it sets the stage for a brighter future for savers in the country.

Kotak’s ActivMoney to Change the Paradigm of Savings Culture

Kotak Mahindra Bank Limited announced the launch of its ActivMoney feature which gives customers the benefit of FD like interest up to 7%* p.a., and the flexibility to access their funds anytime! Through ActivMoney, excess funds in the account, beyond a defined threshold, are automatically transferred into a Fixed Deposit, thereby helping customers earn a higher interest on their savings.

According to RBI data, as of March 2023**, the cumulative Savings Account deposit of all scheduled commercial banks in India is Rs 62.9 lakh crore that earns an industry average of 3.5% interest p.a., as against other instruments like Fixed Deposit, Liquid Funds etc. which gives them higher interest for a duration of six months to one year. ActivMoney spruces up interest income on the savings account with a 7%* p.a. interest rate for 180 days as well as no premature withdrawal charges which otherwise are applicable to a Fixed Deposit, thereby offering the customer the best of both worlds.

Virat Diwanji, Group President and Head, Consumer Banking, Kotak Mahindra Bank said, “Customer centric products and services is at the core of our business strategy. With ActivMoney, we aspire to change the paradigm of savings culture of Indians by offering customers FD wala interest rate on their savings account while retaining the flexibility to access funds anytime without any penalty on foreclosure.”

Rohit Bhasin, President – Retail Liabilities Product and Chief Marketing Officer, Kotak Mahindra Bank said, “Kotak’s ActivMoney fulfils the needs of young, aspirational consumers seeking higher returns on their savings whilst having the flexibility to access funds whenever needed. ActivMoney makes banking more rewarding and enables consumers to use their savings more efficiently and effectively.”

Once a customer avails the ActivMoney feature in the Savings Account, it automatically transfers the balance above the threshold (defined as per account variant) in multiples of Rs 10,000/- to an FD of 180 days currently at an interest rate of 7%* p.a. In case a customer wishes to use the funds, the entire balance in Savings and FD is instantly available. Thus, a customer earns higher interest up to 7%* p.a. for the time she keeps her savings in FD through ActivMoney and the balance in her Savings Account earns 3.5% p.a. ActivMoney is also available to 811 and Current Account holders.

Default minimum threshold over which the surplus funds earn FD wala higher interest rate is Rs 25,000 for Savings/Salary/811 accounts and Rs 50,000 for Current accounts.

New customers can avail of this facility when they open an account online via www.kotak.com or by visiting the nearest branch while existing customers can sign up through mobile banking shortly or the nearest branch.