1. What is the ICICI Savings Account Interest Calculation?

The ICICI savings account interest calculation determines the monthly interest earned based on the average balance maintained in the account and the annual interest rate. Interest is calculated monthly and credited to the account quarterly or as per bank policy.

2. How Does the Calculator Work?

The calculator uses the ICICI savings interest formula:

Where:

• \( average\ balance \) — Monthly average balance maintained in the account (INR)
• \( r \) — Annual interest rate (percentage)

Explanation: The formula calculates monthly interest by converting the annual rate to a monthly rate and applying it to the average balance maintained in the account.

3. Importance of Interest Calculation

Details: Understanding how interest is calculated helps account holders maximize their savings returns, plan their finances better, and make informed decisions about maintaining optimal account balances.

4. Using the Calculator

Tips: Enter the monthly average balance in INR and the annual interest rate in percentage. Both values must be positive numbers for accurate calculation.

5. Frequently Asked Questions (FAQ)

Q1: How often is interest credited in ICICI savings accounts?
A: Interest is typically calculated on daily balances and credited quarterly to the account.

Q2: Does ICICI offer different interest rates based on balance tiers?
A: Yes, ICICI may offer different interest rates for different balance slabs. Check current rates on their official website.

Q3: Is the interest earned on savings accounts taxable?
A: Yes, interest earned on savings accounts is taxable under Income Tax laws, subject to applicable exemptions.

Q4: How is average balance calculated?
A: Average balance is typically calculated as the sum of daily closing balances divided by the number of days in the month.

Q5: Can the interest rate change during the year?
A: Yes, banks may revise interest rates based on RBI monetary policy changes and market conditions.