Jio Payments Bank (JPB) announced that it is considering rolling out "Savings Pro," a first-of-its-kind product in India that will automatically invest unused deposits into overnight mutual funds, potentially increasing returns for millions of customers.
Addressing shareholders at the annual general meeting, Jio Financial Services' managing director and CEO Hitesh Sethia stated, "The Payments Bank is soon going to launch an innovative new product, called Savings Pro, which will bring to customers India's first savings account that auto-invests idle cash in overnight mutual funds for better returns."
Key Highlights
- Jio Payments Bank introduces ‘Savings Pro’, auto-investing idle funds into overnight mutual funds for better returns.
- The service helps customers earn ~5–6% on idle cash versus 2.5% savings, though ₹2 lakh deposit cap applies.
How much can you actually gain?
Assume you keep ₹1 lakh as an emergency buffer in your Jio Payments Bank account.
- Current scenario (2.5% annually)- One year's interest equals ₹2,500.
- Auto-investing in overnight funds at a rate of 5.5% per year yields approximately ₹5,500 in returns.
That's an extra ₹3,000 per year—on money that would otherwise be idle. When scaled to larger balances, the impact becomes even more significant.
The payments bank is focusing on diversifying revenue streams, according to Sethia, who mentions that services such as Aadhaar-enabled payments, domestic money transfers, and B2B UPI will help with this.
Also Read: Unity Bank Partners with BharatPe to Introduce EMI-based Credit Card
While innovative, here are a few things customers must consider:
Deposit cap: Payment banks, including Jio, have a deposit cap of ₹2 lakh per customer. As a result, auto-investing is best for short-term cash flow rather than long-term wealth accumulation.
Overnight fund risks: Despite being safer than most mutual funds, overnight funds are not "risk-free." Returns may fluctuate slightly as interest rates change.
Liquidity: Money is available the following day, not immediately like a regular savings account—important for emergencies.
JPB currently serves 25 lakh customers with a deposit base of ₹358 crore. Savings Pro positions it as more than just a transaction bank, while also connecting to Jio Financial Services' larger ecosystem, which already includes insurance (with Allianz), asset management (with BlackRock), and credit (home loans, LAP, corporate loans).
What should you do as a saver?
Use it to store short-term cash: Emergency funds or a buffer for monthly expenses.
Do not store large amounts of wealth here:For larger amounts, consider using fixed deposits, liquid funds, or other options to avoid exceeding the ₹2 lakh limit.
Track fees and taxation: Overnight funds are classified as debt mutual funds, with gains taxed at your income slab rate.
Check liquidity needs:If you need instant cash access 24x7, keep a portion of your money in savings and only let the surplus flow into overnight funds.
