What to do with your idle money in Savings Account? | Kotak Mahindra Bank
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Having idle money just sitting in your savings account can be a missed opportunity to grow your wealth. While savings accounts provide easy access to funds, they tend to offer a comparatively lower interest rate. At times like these when the inflation is high, the purchasing power of money in a regular savings account steadily diminishes.

However, there are smart ways to make your idle money work harder without compromising on accessibility. Here are some options to consider:

Invest in short-term debt funds

Debt mutual funds that invest in fixed income instruments like bonds, treasury bills, certificates of deposit give higher returns of 6-7% than savings accounts. Opt for ultra-short duration or low duration funds that invest in securities of up to 1 year maturity. This ensures easy liquidity to withdraw your money.

Recurring deposits

Recurring deposits allow you to deposit a fixed amount every month into a term deposit. This disciplined investing helps to build a corpus over time. Premature withdrawals are also allowed, though you lose out on some interest. Returns are higher than savings accounts.

Liquid funds

These invest in cash assets like cash equivalents, treasury bills, and term deposits maturing within 91 days. Provides easy liquidity like savings accounts but earns more interest. Withdrawals allowed any time with same day credit. An ideal parking option for surplus short-term money.

Flexi fixed deposits

Flexi FDs allow you to choose a fixed deposit for long term, while keeping a part of the amount in savings account to handle liquidity needs. Gives higher FD returns on bulk of corpus while meeting withdrawals through linked savings account. Useful for idle money needed at a short notice.

Sweep-in fixed deposits

Here surplus funds above a threshold get swept into FDs automatically while retaining flexibility to withdraw via the linked deposit accounts. Kotak ActivMoney savings account offers this sweep-in benefit.

How Kotak ActivMoney makes your money smarter

Kotak ActivMoney is a premium account that offers higher FD returns on idle savings, without locking up your funds.

It automatically sweeps excess money from your savings account into fixed deposits in the multiples of ₹5000. You earn up to 7% p.a. interest on these deposits, which is comparatively higher than the interest rates on savings accounts.

The best part is your money remains easily accessible via linked FDs created. They get instantly liquidated to honour any withdrawal request from your ActivMoney account without penalty.

By earning higher returns while retaining liquidity, Kotak ActivMoney ensures your savings keep growing in value instead of declining. The power of compounding can help you reach your financial goals sooner by accelerating your wealth growth.


Kotak ActivMoney is a smart way to put your idle savings to work. The sweep facility automatically transfers your excess funds to a high-interest account, so you can earn more without lifting a finger. Just park your surplus funds in the account and watch them grow.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.