Savings and Current Account Module

Table of Contents

1. Introduction

The **Savings and Current Account Module** is a core component of any **Core Banking System (CBS)**. It's designed to efficiently and securely manage customer savings and current accounts, handling everything from **account creation** and **interest computation** to **transaction management** and **regulatory compliance**.

2. Key Features

2.1. Account Management

• **Account Opening:** Streamlined onboarding of individuals, including robust **KYC (Know Your Customer)** compliance.
• **Account Maintenance:** Easy modification of customer details, such as address updates or nominee additions.
• **Dormancy Handling:** Automated flagging and transition of inactive accounts to dormant status, adhering to established bank policies.

2.2. Interest Calculation

The module supports flexible interest calculation methods, ensuring accurate and timely crediting to customer accounts.

• **Calculation Frequency:** Supports daily, monthly, or quarterly interest calculations.
• **Automated Credit:** Interest is automatically calculated and credited periodically.
• **Calculation Methods:** Utilizes various methods, including minimum balance, daily balance, or average balance.

2.3. Transaction Handling

A comprehensive suite for managing all account transactions:

• **Deposits:** Supports cash, cheque, and various digital modes.
• **Withdrawals:** Facilitates withdrawals via ATM, branch, UPI, IMPS, NEFT, and other channels.
• **Standing Instructions:** Manages automated recurring debits and credits for bill payments, loan EMIs, etc.

2.4. Limit Management

Critical for risk mitigation and regulatory adherence:

• **Minimum Balance Enforcement:** Ensures accounts maintain a specified minimum balance.
• **Withdrawal Limits:** Configurable daily or monthly withdrawal limits based on customer categories or account types.

3. Statements & Reports

The module provides essential outputs for both customers and internal stakeholders:

• **Account Statements:** Periodic statements delivered via email, SMS, or available at branches.
• **Comprehensive Reports:** Generates reports for audits, regulatory submissions, and **MIS (Management Information System)**, offering insights into account activity and trends.

4. Workflow

The typical lifecycle within the Savings and Current Account Module follows a clear progression:

Customer Onboarding → KYC Verification → Account Creation → Initial Deposit → Transaction Operations → Interest Calculation → Statement Generation

5. Interest Calculation Example

Here's another example demonstrating daily balance interest calculation:

• Principal: ₹10,000
• Interest Rate: 4% per annum
• Calculation Period: 30 days
• Method: Daily balance

Formula:

Interest = (Principal \times Rate \times Days) / (365 \times 100)

Interest = (10,000 \times 4 \times 30) / (365 \times 100)

Interest \approx ₹32.87

Interest is typically credited to the account at the end of the quarter or month, depending on the bank's configuration.

6. Integration Points

Seamless integration with other core banking modules is crucial for holistic operations:

• **Customer Information Module:** For comprehensive KYC and customer demographic data.
• **Transaction Module:** For posting all debit and credit entries.
• **GL (General Ledger):** For backend accounting and financial reconciliation.
• **Notification Module:** For sending real-time SMS and email alerts to customers regarding transactions and other account activities.

7. Security and Compliance

Security and regulatory adherence are paramount:

• **Robust Authentication:** Supports **multi-factor authentication (MFA)** and **role-based access control (RBAC)** to protect sensitive data.
• **Audit Trails:** Tracks all activities with detailed **audit logs** for transparency and accountability.
• **Regulatory Compliance:** Ensures strict adherence to **RBI guidelines**, **AML (Anti-Money Laundering) policies**, and relevant tax regulations.

8. Usages and Benefits

Feature	Usage / Benefit
**Automated Interest Calculation**	Saves manual effort, significantly reduces errors.
**Real-time Transaction Processing**	Enhances customer satisfaction through instant updates.
**Integration with Digital Channels**	Enables seamless mobile and internet banking experiences.
**Configurable Rules**	Caters to diverse account types (e.g., student, senior citizen) and specific product requirements.

9. Core Operations

• **Add New Savings Accounts:** Functionality for creating new savings accounts efficiently.
• **Savings/Current Account Deposit:** Manages all deposit transactions into both savings and current accounts.
• **Savings/Current Interest Payout:** Handles the accurate and timely crediting of interest to relevant accounts.