Current Account is one of the most basic and flexible deposit options for all the business needs. These are cheque operated account and primarily meant for businessmen, firms, companies, and public enterprises etc that need banking facility more frequently. Unlike savings bank account, no limits are fixed by banks on the number of transactions permitted in the Account.
Most of the banks usually insist for a higher minimum balance as compared to savings account to be maintained in Current account. Now Current accounts are available with debit card and online banking facilities which make the transactions easier. Certain service charges are also imposed for operating current account. However these account cannot be considered as a saving account since the banks are not allowed to pay any interest to current account balance. Incase of death of the account holder his legal heirs are paid interest at the rates applicable to Savings bank deposit from the date of death till the date of settlement.
Advantages of a Current Account
- Overdraft facility is available
- Speedy fund transactions can be done by this account.
- Unlimited depositing and withdrawing facility
- Nomination facility is available under this current account.
- Third party cheque will be collected by the depositor if they are endorsed.
How to open a Current Account?
Opening a Current Account varies depending on the bank . Current Account can be opened in the name of an individual or in joint names of the depositors by filling up the appropriate forms. Normally the applicant has to visit the bank himself for opening a new account. Most of the procedures are same as opening a saving account. Any of the address proofs such as Passport, Driving License, Voters ID etc along with two passport size photos are required for opening an account. PAN Number and Declaration in Form 60 and 61 as per the Income Tax Act, 1961 is also necessary. An existing account holder or a respectable citizen, well known to the bank should introduce the applicant at the time of opening the account. For business accounts, copy of the Business Registration to be submitted by the account holder. Copy of the Memorandum of Association and Article of Association duly certified to be submitted for opening a current account for company or a firm. Opening current account for a society, constitution together with a list of current office bearers to be submitted.