We are all fond of vacations. However, usually we end up either compromising on the destination or pay higher amounts due to lack of pre-planning. State bank of India has come up with a solution to this problem. SBI has launched SBI Holiday Savings Account by partnering with the travel firm Thomas Cook. What is this SBI Holiday Savings Account all about? How SBI Holiday Savings Account benefit travel goers? Should you really opt for such holiday savings account?
Also Read: How to reduce your travel expenses by advance planning?
What is this new scheme – SBI Holiday Savings Account?
Thomas cook has come up with the scheme called Holiday Savings Account with State Bank of India, which is also called as an HSA. Under this scheme a customer will be able to pre-select a holiday destination as per their wish from a travel company and make savings it in the bank through a recurring deposit. This scheme is very beneficial and easy to avail. In this scheme the customer has to pay the installments. The customer will pay 12 installments and the travel firm will pay the 13th installment at the end of the period.
SBI’s Managing Director said that the customers don’t plan their vacation in advance and at the end they take last-minute loans, which increases their expenses. By this scheme launched by SBI, people would be able to plan their savings on holidays and go for advance bookings.
This plan is a unique saving plan for the holiday lovers. This plan would help the customers to save some monthly amounts in the form of recurring deposit with the bank so that they can avail a vacation listed under Holiday Savings Account packages as shown on Thomas cook website.
How does this package works exactly?
It is very simple to understand how this scheme works. There are a few easy steps which include:
- One has to visit the Thomas cook HSA website and choose the package of the individual’s choice.
- The cost of the package that has been chosen will be divided into 12 installments and the travel firm will pay 13th installment. So in this customer will be redirected to the Online SBI portal where they can set up a recurring deposit account for the 12 monthly installments.
- Customers recurring deposit account will earn interest as per the prevailing interest rate for the 12 month period.
- As the 12 months ends the maturity proceeds will be transferred to Thomas cook to pay for the customers pre selected holiday package.
- The 13thinstallment will be funded by Thomas cook which will also be your balance account and the customers can easily avail its holiday package.
Let me explain with an example. I have gone to Thomas Cook website. I have selected Goa which says Rs 700 x 13 package (3 nights 4 days package per person). Means if I open Rs 700 e-RD with SBI per month for 12 months, 13th installment would be funded either through interest or through Thomascook. You can select the package and no. of people and it would take you to opening the SBI Holiday savings account with SBI. One should be SBI SB holder to open this account. You should note that this is not the full package, but only for hotel + food. You would still incur travel fare to reach to Goa. Also, this is only for one person. If you opt for a spouse or for children, the cost is multiplied by no. of people.
There are a few other terms and conditions in this scheme which states that all the information that will be required for opening this recurring deposit account by SBI will also be re-directed to Thomas cook. The tenure of this plan is fixed, i.e. for 12 months and thereafter the travel partner-Thomas cook would decide the amount as per the package being chosen by the customer. The account in INR will be generated in the name of the account holder, i.e. the account from which it is funded. Premature closure of the account is allowed and the banks applicable premature withdrawal fees will be applied.
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Should you opt for SBI holiday savings account?
The Major benefit of this scheme is that it promotes tourism in the country and let people plan their holidays more sensibly and with cost effectiveness. As we know through this scheme customers will deposit for their future holidays, customers will be free from inflation and can opt out of it in unavoidable circumstances. The process too is simple. So if you have a destination is mind, get yourself enrolled and “ Have a happy and pre planned vacation”.
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SBI Holiday Savings Account
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What is the difference between investing in sbi holiday and normal reccuring deposit account? What are the extra benefits that I am going to get?
How about the case where after completing the 12 months pay if I can not go for the tour because of personal issues or I can go tour after 3 months of maturity.
You can modify the dates Narsi. However you should indicate in advance to thomas cook
But, will I retain any ‘negotiation’ power if I go this way because I am pre-committing myself for the money (because my money will go the Thomas Cook after the 12th installment) and the plan also.
Why it is not workable is that I can open myself a simple 12 month RD a/c with SBI or any other bank or Post Office and after 12 months, can negotiate my plan with any Travel Plan Provider and then decide what to do and with whom to go.