Banks calculate savings interest on the day-end balance and credit it quarterly. This calculator accrues interest month by month on the running balance and compounds it every quarter, matching that practice.

If you add money each month, the balance — and therefore the interest — grows steadily through the period.

Given: Average balance ₹200,000 at 3.5% p.a. for 12 months, no additions

Daily accrual = 200,000 × 3.5 / (365 × 100) ≈ ₹19.18 per day

Quarterly credit ≈ ₹1,750  ·  With quarterly compounding, annual interest ≈ ₹7,092

Effective annual yield ≈ 3.546% versus the stated 3.5%.

• Interest is computed on the day-end balance, so keeping funds parked longer earns more.
• Many banks pay a higher rate on balances above a threshold — this uses a single rate.
• In India, savings interest up to ₹10,000 is deductible under Section 80TTA (₹50,000 under 80TTB for senior citizens).
• Savings rates are typically well below FD rates; consider a sweep-in FD for idle balances.

How often is savings interest paid?
Quarterly in most banks, though it accrues daily.

Does the minimum balance matter?
Only for charges — interest is based on the actual day-end balance.

Is savings interest taxable?
Yes, though a deduction is available up to the prescribed limit.