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Saver Loans also known as Smart Loan, combines the advantages of a Loan account with the flexibility of an Overdraft account for self-employed individuals. In this product, the Loan is Linked to a Current/Overdraft Account freshly opened with the lending bank. The Interest earned on the balances in the current account are adjusted against the Interest payable on the loan on a daily basis, thereby facilitating to save Interest for the customer. The customer also has the flexibility to withdraw the amounts deposited in the current account whenever required.

You can use our Saver Loans Calculator to see how it works.

Saver Loans India

Click on the following links to know more about Saver Loans :

How does Saver Loans work
 

The Banks' computer system keeps a track of an Ideal Balance in the current account and the Actual Outstanding towards the Loan. The Ideal balance will be the normal amortization of the loan every month based on the contracted loan amount, tenor, interest rate & EMI. The actual balance is the actual outstanding loan amount.

The Line amount is calculated as follows:
Line Amount = Ideal balance - Actual balance
The Line Amount is the amount which remains available to the customer for withdrawal.

Types of Saver Loans
 

There are broadly 2 types of Saver Loans offered in the industry. Banks/HFC's have coined various names for these products. In general they are,

  Overdraft Line FastTrack Payment
Basic Functionality Interest payment towards the Loan is saved by adjusting the Ideal Balance in the Current account towards Actual Outstanding in the Loan account. Interest payment towards the Loan is saved by adjusting the Ideal Balance + Interest accrued from the Ideal Balance in the Current account towards Actual Outstanding in the Loan account.
Interest earned on Ideal Balance Can be withdrawn as and when required. Cannot be withdrawn. It gets adjusted towards the Interest payment on the Loan.
Good for Maintaining Liquidity Faster Loan repayment
Suitable for Self-employed Individuals who would want to earn Interest on their ideal funds and at the same time enjoy Liquidity. Salaried Individuals who would want to re-pay the loan faster by utilizing their monthly surplus earnings.

Source : MoneyLeo.com research team
Who is offering Saver Loans
 

Banks Home Loans Loan against Property
Overdraft Line FastTrack Payment Overdraft Line FastTrack Payment
Bajaj Finserv No No No No
Barclays Bank No No No No
Cholamandalam No No No No
Citibank Yes Yes Yes Yes
HDFC Bank Yes Yes Yes Yes
ICICI Bank Yes Yes Yes Yes
Indiabulls No No No No
Reliance No No No No
Standard Chartered Yes Yes Yes Yes

Source : MoneyLeo.com research team
Advantages of Saver Loans
 

Some of the key advantages of opting for Saver Loans are,