Current accounts are very common among businesses, corporates, firms or public enterprises as they provide higher number of banking transactions. Such accounts are also known as demand deposit accounts and they can be opened in any commercial bank across the nation. Let’s delve more into current account and its features.
What is a Current Account?
A current account is a bank account where regular banking activity such as withdrawals and deposits take place. These accounts are zero accounts with no limit on the number of transactions or the amount of transaction that is made. Account Holders have access to funds anytime, anywhere. Due its fluidity current accounts are no interest accounts
Current accounts are of different types with various features suiting the different requirements of the entities and a business can choose one as per the need. Unlike any other type of account, a current account provides numerous transaction benefits, making it widely popular among businesses.
Uses of a current account
Current account can be used for all kinds of banking activities. It includes paying bills, making rent payments, depositing cash or withdrawing cash. One can also make purchases using the pin and debit cardwith the current account.
Most of the workers get their wages in the current account which can be later shifted to any other account of choice.
Features of current account:
- Current accounts allow systematic handling of large volumes of cash as payments or receipts
- These accounts allow limitless withdrawals with a levied transaction fees
- Current account have no limit on the deposits made to the account. Additionally account holders can deposit cash at any other branch by paying a small fee.
- To make direct payments, current account allows issuance of cheques, demand drafts, or pay-orders
- Account holders have overdraft facility on the current accounts. Overdraft facilities help in managing the capital needs at any point.
- Businesses can further have an advantage of current account with benefits such as inward remittances, deposit and withdrawals at any location or multi-locations transfers.
- There is no limit on the withdrawal for a business man except the cash transaction tax if levied by the government.
- The current account not only helps a business man but also drives the country’s industrial progress, which would otherwise have been difficult. The SMS banking facility enables the account holder to get update of account balance any time without visiting the bank.
- Current account also has the facility of internet banking and mobile banking which helps the business complete any transactions with ease every month. This helps in hassle free payments to vendors. In case of savings account only one cheque book is issued for the entire year and the account holder needs to pay extra charges for additional cheque books.
- Few banks also allow customised Current accounts depending upon the businesses or the type of entity.
Therefore opening a current account as business entity brings numerous benefits to the business as well as the owner. The flexibility of this account is gives irreplacable solution which other accounts cannot give. Having a current account is anyday a better solution for business over any other account type.