If you have just registered or wants to register a company for your business and wants to open a bank account for your business operations. Then this article will guide you the complete list of documents required for opening bank account of your company.
Current accounts are used for the majority of routine banking transactions. A company entity often opens it to carry out its daily operations. There is usually no interest attached to a current account and no daily limit on the number of transactions that can be conducted.
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What is a current account?
The current account is a bank account where you can deposit and withdraw funds. A debit card that you may use to access your money and an 8-digit account number is often given to you when you start a current account. You are also typically given a 6-digit sort code. Most banks provide Current accounts with various features to help you pick the account that best meets your needs.
Current accounts are tied to liquid deposits and provide various tailored alternatives to facilitate financial transactions. Also, it enables using the bank’s cheque service to pay creditors. In contrast to savings accounts, current accounts typically don’t offer interest and have higher minimum balance requirements.
Benefits of a current account
Transactions and deposits are limitless
A Current Account holder may make any number of transactions. The deposits placed into current accounts are not subject to this restriction. Moreover, Current account holders can deposit cash at other locations by paying modest fees.
An overdraft option is available to current account holders, allowing them to ask banks for help funding the purchase of raw materials if they are short on cash.
While the bank records every account holder’s previous transactions, you can remember every transaction you’ve ever made. As a result, if you have a current account, tracking is simple.
You may effortlessly run the same business from different cities using online banking. If your company or branches are located in another town, you can use the branch of that bank there.
Using online and mobile banking allows you to make payments easily. You can deposit checks electronically using NEFT or RTGS, eliminating the need for a physical bank visit.
Bank guarantee service
If the owner of a current account keeps a good record of his account, he may use a bank guarantee service.
Keep personal and corporate finances separate.
The distinction between personal and commercial accounts can be kept up with a current bank account. Making a distinction between what belongs in a company account and what belongs in a personal finance account by opening a separate Current account to keep track of business income and expenses is helpful.
Opening a current account can facilitate this process. A letter from your bank confirming that you have a Current account could be provided to them. Interbank links can also be used to check creditworthiness as an alternative.
The company that maintains a current account can benefit in several ways, including no additional fees for remittances, fund transferability, free withdrawals, etc.
Features of a current account
- Usually, current accounts are interest-free accounts.
- The transaction limit is higher than for savings accounts.
- It necessitates a larger minimum balance when starting the account.
- Cash deposits into current accounts are not subject to a cap at the home branch.
- Current accounts can be used by companies, businesses, firms, people, business owners, etc. But a company is only allowed one Current account.
- If the minimum balance is not maintained, penalties might be assessed.
- The main goal of a current account is to conduct business transactions without incident.
Documents required for opening bank account
- Identity Proof – Voter ID, Passport, Driving License, PAN Card, etc.
- Address Proof – bank statement, utility bill, passport, etc.
- Proof of signature – Verifying a signature from a bank or post office.
- Photo – Passport–sized photographs.
- KYC Documents – Documents such as PAN Cards, Aadhar Cards, etc.
- Initial Deposit – A current account must be opened with a minimum deposit.
- Cheque Book – A chequebook used for payments.
A current account can be beneficial to your company. The entire history of your company’s trends can be found in your Current account. You might also gain from it regarding your anticipated future cash flows.