A savings account is a demand deposit account held with a bank. It must always have a credit balance and is therefore never associated with a credit line. Generally, a savings account is linked to a current account used for day-to-day transactions. The money deposited in the savings account is permanently accessible and when needed can be transferred to the current account or withdrawn in the bank.
Objective: a savings account is used to manage cash.
Description of savings accounts
Application terms and conditions
Amount: there is no minimum amount for a savings account. It can even have a zero balance temporarily, but it can never be overdrawn.
Credit interest: a savings account earns credit interest at a higher rate than a current account, but in general at a lower rate than a term deposit for a large amount.
Holder and proxy: the holder of a savings account, called the account holder, can also give power of attorney to third parties, who are then called proxies.
The time required to open a savings account depends on various factors, including, for example, the banking relationship between the business and the relevant bank, the legal status of the business or company, the applicable law of the company (Luxembourg or foreign law), etc.
Advantages and disadvantages
- risk-free investment;
- permanent availability of the money;
- flexibility of cash management;
- low costs;
- higher interest rate than for an interest-bearing current account.
- in principle, lower interest rate than for a term deposit;
- loss of value dates.