1. What is Interest Rate in HDFC Saving Account?

The interest rate in HDFC saving account refers to the return earned on the average monthly balance maintained in the account. It is calculated based on the annual interest rate provided by HDFC Bank.

2. How Does the Calculator Work?

The calculator uses the interest formula:

Where:

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

Explanation: The formula calculates the monthly interest earned by dividing the annual rate by 12 and applying it to the average balance.

3. Importance of Interest Calculation

Details: Accurate interest calculation helps account holders understand their earnings, plan finances, and compare different saving account options.

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.

5. Frequently Asked Questions (FAQ)

Q1: How often is interest credited in HDFC saving accounts?
A: Interest is typically credited quarterly in HDFC saving accounts.

Q2: Does HDFC offer different interest rates based on balance?
A: Yes, HDFC may offer tiered interest rates where higher balances earn higher rates.

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

Q4: How is monthly average balance calculated?
A: Monthly average balance is calculated by summing the closing balance of each day and dividing by the number of days in the month.

Q5: Can the interest rate change?
A: Yes, banks can revise interest rates based on RBI policies and market conditions.