Decoding banking choices: Personal banking vs. private banking
3 Minutes November 8, 2023
In the world of banking, personal banking and private banking are two terms that are oftenused interchangeably. However, they are not the same and cater to a distinct clientele andoffer different services and advantages. It’s essential to decode these two bankingchoices so that you pick the one best suited for you.
What is personal banking?
Personal banking is meant for day-to-day financial andbanking transactions for individuals from all walks of life. It includes everything fromsavings accounts and current accounts to credit cards and loan options like personal loansand home loans. All these essential banking and financial services are available to a broadaudience, which makes managing their money easy and convenient.
Whether it is a college student, a homemaker, a salaried professional, or an entrepreneur,personal banking exists to offer them a wide range of banking services to help navigate therealm of personal finance.
What is private banking?
Private banking is an upgrade from personal banking – it is an exclusive financial realmdesigned specifically for High-Net-Worth Individuals (HNIs). Typically, private banking isaccessible only to those with a net worth above a certain amount and through an invitationonly. Private banking offers a premium and sophisticated approach to banking and finance.
Another thing that sets private banking apart from personal banking is the level ofpersonalisation and customisation it offers. HNIs are offered highly tailored bankingservices and financial solutions to meet their unique needs. Moreover, private banking goesbeyond traditional banking offerings. The range of services offered by private bankinginclude investment management solutions, financial advisoryservices, estate planning, insurance planning, tax advisory services, and more.
Personal banking vs private banking
Let’s break down some of the important differences between personal banking and privatebanking in greater detail.
Client base and access
Personal banking is more inclusive because it aims to provide banking services to a widerange of individuals, irrespective of their income levels and financial backgrounds.It’s easily accessible to the general public and any person can open a bank account aslong as match the basic criteria of age and nationality.
Private banking, on the other hand, is reserved only for individuals with substantial assetsand wealth. There is a specific eligibility criterion for private banking and typicallyaccess is granted through an invitation only.
Services and solutions
Personal banking provides basic banking services like savings accounts, credit cards, andloans. The idea here is to provide easy access to standard banking and financial solutionsso that individuals can meet their financial goals irrespective of the life stage they arein. The solutions offered are not very customised and are designed keeping a broad range ofcustomers in mind.
With private banking, however, everything is tailored to the HNI client. There is adedicated relationship manager who works closely with the HNI to understand their financialneeds and to collaboratively undertake financial and investment planning. Private bankingalso offers exclusive perks like preferential interest rates on loans, luxury conciergeservices, family office solutions, and more.
Which banking service should you pick?
As an HNI, private banking is the ideal banking service for you. It not only provides basicbanking services but offers expert guidance and support in various financial and relatedaspects of your life and business, allowing you to optimise your time and wealth.
This Article is for information purpose only. The viewsexpressed in this Article do not necessarily constitute the views of Kotak Mahindra BankLtd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect tothe completeness or accuracy of the material and articles contained in this Article. Theinformation contained in this Article is sourced from empanelled external experts forthe benefit of the customers and it does not constitute legal advice from the Bank. TheBank, its directors, employees and the contributors shall not be responsible or liablefor any damage or loss resulting from or arising due to reliance on or use of anyinformation contained herein.
FAQs
Insights into the Features of the Best Private Banks in India 2024
- Kotak Mahindra Bank. ...
- Axis Bank. ...
- IndusInd Bank. ...
- IDBI Bank. ...
- Yes Bank. ...
- IDFC First Bank. ...
- AU Small Finance Bank. ...
- Federal Bank. Federal Bank is a preferred top private bank in India for personal, NRI, and business banking across India's urban and rural areas.
We endeavor to offer best-in-class product suites with the potential to deliver superior risk-adjusted returns across asset classes. Being a part of a large financial conglomerate, we are one of the few Indian private banks that have access to a holistic banking platform.
Who is the billionaire Uday Kotak? ›
Uday Suresh Kotak (born 15 March 1959) is an Indian banker and Founder of Kotak Mahindra Bank, where he is a non-executive director. In the early 1980s, while India was still a closed economy and economic growth was slow, Kotak decided to start on his own, refusing a lucrative job option from a multinational.
What is the relationship value of Kotak private bank account? ›
7.5 Cr Relationship Value and minimum savings bank account balances (Average Yearly Balance) of INR 50 lakhs.
Which is the best bank for private banking? ›
- The Private Banking Top 10 List.
- UBS.
- Morgan Stanley.
- Bank of America.
- J.P. Morgan Private Bank.
- Citigroup.
- BNP Paribas.
- Goldman Sachs.
J.P. Morgan Private Bank is named 2024's “World's Best Private Bank” for the fifth year in a row. For its ninth annual World's Best Private Banks Awards, Global Finance Magazine ranked J.P. Morgan Private Bank* first overall.
What happened with Kotak Bank? ›
RBI observed “serious deficiencies and non-compliances” concerning KMB's IT inventory and user access management, data leak and leak prevention strategy, business continuity and disaster recovery rigour and drill, among other things. Kotak Mahindra however had plans to continue investing in their card franchise.
Is Citibank a private bank? ›
Citi Private Bank serves clients from around a hundred jurisdictions globally. The Private Bank is a business of Citigroup Inc, one of the world's largest financial institutions, with a network spanning 162 countries and jurisdictions across six continents.
Which bank is best for savings accounts? ›
Best Savings Bank Accounts of 2024
| Sr.No. | Bank Name | Rates of Interest(p.a.) |
|---|
| 1 | State Bank of India | 2.70% - 3.00% |
| 2 | Union Bank of India | 2.75% - 3.55% |
| 3 | HDFC Bank | 3.00% - 3.50% |
| 4 | ICICI Bank | 3.00% |
6 more rows3 days ago
Mukesh Ambani, with a net worth of $117.5 billion, holds the title of the richest person in India.
RBI bars Kotak Bank from adding new customers; Your money in the bank is safe.
Who is the richest banker in India? ›
Uday Kotak built his Kotak Mahindra Bank Ltd. over decades to become Asia's richest banker. After India's regulator slapped his bank with a surprise ban, he's facing one of his biggest tests yet - and a dip in wealth.
What is the minimum amount for a private bank? ›
Private banking minimum requirements are generally around $250,000 in investable assets, though some banks will set the bar higher than others. Let's take a look at some examples: Bank of America private bank minimum requirement is $10 million.
Why is private banking good? ›
A private bank should offer you special access to all the classic services offered by banks and financial planners—planning, investing, borrowing and banking—all in one place. Then it should do more. Connect you to unique opportunities and people. Help you identify and reach the goals you set.
Who is the head of Kotak private banking? ›
Oisharya Das heads the Private Banking business at Kotak Mahindra Bank Ltd., and has been an integral part since its inception.
Is it worth using a private bank? ›
The main benefit of using a private bank over a high-street establishment is the expertise you could access as a client, and the exclusive touches you'd expect from a bespoke service.
What is the best private bank in the US Financial Times? ›
CHICAGO --(BUSINESS WIRE)--May 3, 2024-- Northern Trust , a leading provider of wealth management services, has taken top honors in two categories from the Financial Times and PWM's Wealth Tech Awards: Best Private Bank in the US for Digital Wealth Planning, and Best Digital Innovator of the Year in the US.
Are private banks better? ›
Most private banks also offer additional benefits to clients who maintain a certain level of assets in their accounts. This may include fee waivers on banking services, preferred interest rates on qualifying new loans and lines of credit, and bonus interest rates on select deposit and savings accounts.
How do I choose a private bank? ›
Research the reputation of the private bank itself. Consider factors such as its history, financial stability, regulatory compliance, and client reviews. A reputable private bank is more likely to provide reliable and quality services. Assess the private bank's range of services beyond wealth management.
3 Minutes
November 8, 2023