Indian banks offer several types of accounts. Two of the most popular accounts that people prefer primarily are Savings accounts and Current accounts. While most of the common salaried folks choose a savings account for depositing their funds for personal use and saving purposes, business people, entrepreneurs, and associations prefer current accounts to carry out daily transactions.
Let’s know more about a current account, its benefits, and its importance.
What is a Current Account?
A current account is a kind of bank account that is used by organisations of all sizes – small and big. If you have a business that carries out many transactions every day, then you need to have a current account. What’s better? You can now open a current account online in a hassle-free way.
What are the features of a Current Account?
A current account is primarily a financial account held with a bank to operate your transactions smoothly. So, a current account is perfect for you if you have a business. There are several perks and advantages of setting up a current account. First, let’s take a look at all the features:
- There is no interest rate as current accounts operate on high liquidity of funds.
- Minimum balance requirements differ from one bank to another. You must always maintain monthly and quarterly balances depending on your bank.
- Unrestricted daily transactions. You can transfer funds online, get and write cheques, and do cash transactions, everything becomes unrestricted, unlike savings accounts.
- You get cheque books, ATM, and Debit Card to use.
- You can use the online banking facility.
- You can also do bank transfers through NEFT, RTGS, and IMPS.
- Overdraft (OD) facility- up to a limit for emergency purposes.
If you need to open a Current Account, then you should fall under the following account type:
- An individual or HUF.
- Private or Public Limited, Partnership firms, Proprietorships.
- Institutions, Trusts, and more.
What are the benefits of a Current Account?
There are several benefits and advantages of current accounts. Let’s take a look:
High Security – If you are handling a lot of cash in the form of currency, then you have a lot of security risks. You need a safe and secured bank account with high security to take care of your deposited funds. This will keep your funds safe, and you can be worry-free.
Meant for businesses – If you deal with a high volume of transactions daily, then you can enjoy limitless transactions every single day with a current account. You don’t have to pay extra charges for this as well, unlike savings accounts. Plus, you get to save and keep a tab on all the expenditures, which will help you file tax returns.
So, can you open two current accounts?
Yes, you can have two or more current accounts for the same business. However, you need to know that you can have these accounts in two different banks. Some banks even allow you to have two or more current accounts for the same business in different branches. So, there is no hard and fast rule of having only one current account for one business.