1. Build your Credit Score
2. Reduce your Current Borrowing / EMI Costs
Contrary to savings accounts, a Current account is primarily used not to save and grow your money. It is used to preserve an amount of money which you will be using soon over a period of time.
A current account is ideal if you have plans to make large transactions regularly. These do not come with a huge interest rate either, which means your money there won’t grow so much.
Yes, there is a modicum of interest rate, yet the primary function is to enable you to access your money whenever you want to. A savings account won’t give you this benefit. It is for this reason all merchants, traders, etc. have at least one Current Account.
You can get different kinds of current accounts from banks according to your requirements. You should pick one which is best suited for your needs. For instance, for the transactions you want to carry out, some types of current accounts are more suited than the rest. Below you'll see the various types. However, before you run off to a bank to start one of them, know that these accounts can differ from one bank to the next.
Standard current accounts: In this type of current account you need to maintain a minimum monthly average balance. It gives no interest on your deposit by giving you various facilities like debit cards, cheque books, overdraft and more.
Basic current accounts: If one has a low wage or salary, or if one is young, this type of current account is ideal. It helps them to manage their money with ease, although there are some daily cash withdrawal restrictions.
Premium current accounts: Just like the name says, this type of account offers various exclusive benefits and offers. If you routinely carry out large transactions, this is the type of account you may want.
Packaged current accounts: It offers a range of perks and benefits, along with exclusive features like travel insurance, medical support, and more.
Foreign currency accounts: This is ideal for NRIs and for those who wish to carry out foreign currency transactions frequently.
Current accounts are beneficial for all, but especially for traders, businessmen and professionals. Here are all the various benefits and pros of a current account.
Current accounts are there to facilitate frequent transactions especially
Customers can be individuals, both private and public companies, associations, proprietors, trusts, and others.
It is similar to a savings accounts and you need to follow KYC guidelines here as well
There is no maximum ceiling for the number of daily transaction
There is no limit for the amount you can keep at the home branch
Current accounts makes it easier for business transactions to be made through a variety of means like DD, cheques and pay orders.
People who can open this type of account can be:
Clubs, societies and Associates
Hindu Undivided Families
Administrators, executors and liquidators
There are two ways to do this. One is by visiting the nearest bank and filling up the application documents. The other way is to apply online.
The documents you’ll need are:
Certificate of Incorporation, AOA and MOA in case of companies
Partnership deed in case of a partnership firm
Certificate of sales tax in case of a proprietorship firm
ID proof and address proof
Cheque for the opening of the bank account
When choosing, pay attention to these criteria.
The minimum balanced you need to keep
Fees, costs and charges
The required cash deposit limit