Who Should Open Current Account? How is it Different from a Savings Account?

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Current Account is a type of bank account which is relevant to the people who run business. Such accounts can be opened with public or private sector banks. Current accounts is ideal for carrying out day-to-day business transactions.

Who Should Open Current Account?

The main objective of this account is to enable the account holder to run his business smoothly as there is no limit on number of transactions or cash withdrawal. Click to know the difference between savings account and current account.

Here are some of the features of the current account:

  1. Current account can be opened to run a business
  2. Usually, interest is not applicable for the amount held in the current account. While, some banks have introduced special current accounts where interest is paid
  3. It enables a bank to collect money on behalf of its customers and credits the same in their customers' current accounts.
  4. It enables the current account holder to obtain overdraft facility.
  5. It enables free cheque payments and collection anywhere in India
  6. Minimum balance to be maintained is high when compared to the savings account.
  7. There are charges if minimum balance is not maintained in the current account.
  8. The current account holders are provided with higher number of cheque books
  9. Current account are not meant for savings and investment purposes, and many banks do not give interest on the amount.
  10. The current account enables a bank to collect money on behalf of its customers and credits the same in their customers' current accounts.

If anyone is found doing business transaction in savings account, the banks all have the right to question you and may force you to close the accounts and open current account.

GoodReturns.in

Read more about: current account, banking
Story first published: Monday, January 19, 2015, 10:42 [IST]
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