Current account is an integral part of any business. Anyone who wants complete access to the banking system and overdraft facilities needs a current account. Let us get acquainted with some unique features of current accounts.
Savings vs Current account
We are often confused between these two account types. Let us checkout the difference.
Savings account earns you interest but current count does not; this is one of the basic differences between these account types.
You have to maintain a minimum balance in the savings account while the balance may even go to negative in a current account.
Savings account is more useful for people who want to save while current account is specially suited for businesses.
Current Account Eligibility criteria –
A current account can be opened only by Indian residents, partnership firms, limited companies, sole proprietorship companies, trust accounts, associations, clubs, societies, and foreign nationals who are residing in India. People with poor credit score or credit issues may not be able to open a current account. This type of account can be used to receive salary, pension, debit and credit cards.
Multiple account types –
There are multiple types of current account which you can open. Just provide the requirement details to the bank and find the best account to suit your needs. Every bank has its own current account types but generally following are the common current accounts.
Standard Current Account
This type of current account is best for small businesses. Features of this type of current account is
Holds money which is spent on a regular basis.
A debit card is provided which can be used in cash machines.
Basic Current Account
This kind of current account is perfect for regular payments through standing orders and debit card facilities.
Overdraft facility is not available with this kind of account.
There are also restrictions on the amount of money which a user can withhold in the account on daily basis.
Business Current Account
This kind of current account is ideal for individuals, religious organisations, public sector undertakings, and small to medium scale industries.
The premium features offered by this kind of current account are
Free cash deposit and withdrawal facility at non-home branches.
Overdraft, cheque and standing instructions for debit facilities.
How to choose the right current account?
As there are multiple options available it is difficult to choose the right type of current account. Keep the following factors in mind while choosing a current account.
What are the upfront fees of the account? Often bank charges this amount as service fees for the services it provides to the current account users.
What is the minimum amount which needs to be deposited in the account every month?
Is there any competitive interest that has to be paid? Generally after the initial phase the banks waive off this charge.
Are transactions through all cash machines free? You might need to transact on various types of cash machines and while opening a current account it is essential to ask if transactions through all machines are free.
Is it possible to open current account online?
So get a current account which understands your needs. After all, your business deserves the best fit current account to run operations smoothly.