Banking: Prashant Joshi

I have two salary accounts, but have stopped using these as I have moved jobs. Should I inform the banks or should close the accounts?
Most banks convert a salary account into a normal savings account if salary credits stop for a quarter or more. Communication is sent to these customers via a letter to their registered address and/or an e-mail one month prior to the conversion.

For salary accounts, usually, there is no minimum account balance requirement. This benefit will cease to exist when salary accounts are converted into normal savings bank accounts. Therefore, after account conversion, clients are required to maintain balances as specified by the bank for a normal savings account to avoid charges for non-maintenance of minimum account balance. As you have moved jobs, it is advisable to close the salary accounts, not just to avoid penal charges but also to ensure they are not misused. You can close the accounts by giving a written request to your bank and return all unused cheques and debit cards.

What is the difference between fixed deposit and recurring deposit accounts? Which is more beneficial?

The major difference between a fixed deposit and a recurring deposit is the periodicity. Therefore, if a person wishes to invest a specific amount at regular intervals, he should opt for a recurring deposit and in case the choice is to invest a lump-sum amount, he should opt for a fixed deposit account.

Both are good vehicles for investment and a person should decide based on whether he has a single big amount available at a specific point in time or can spare a regular sum every month for a pre-determined tenure.

How does it help to buy a travel card?
A travel card is a secure, convenient and economical way to carry foreign currency for foreign travel. It saves you from the risk of carrying foreign currency in cash; it has a much wider acceptance compared to travellers cheque. It has insurance coverage for fraud/misuse.

It is also beneficial to use your travel card for foreign purchases than your rupee debit or credit card from a forex margin perspective, as you lock in the exchange rate upfront at the time of forex loading on the travel card. Further, banks levy a cross-currency mark-up for all international transactions on your rupee debit or credit card. No such cross-currency mark-up is applied if you use the travel card for same-currency transactions, as the currency is loaded on the card.

The views expressed are expert's own. Send your queries to yourmoney@bsmail.in

Today, Prashant Joshi, managing director and head of private and business clients (India), Deutsche Bank, answers your questions