Can you explain how interest works on a savings account?

[Tasha]

Example: you put 10,000 into savings with 20% apy what does this mean how is it calculated how much would you have at the end if the year?

 

[D]

it depends of % of interest and your withdrawals. Most of the bank gives 4% int. on savings ac. Some banks are now giving 6% like kotak mahindra. It is calculated on daily balance as per new RBI regulations. In past if u had say 6000 bal in ur savings ac and if u had withdrawn 2000rs on say 28th of the month, the interest was calculated on the month ending balance of 4000rs for the month. But now in same situation the int is calculated on daily basis on 6000rs till 27th and then on 4000rs from 28th of the month.