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What Are The Benefits Of Current Account?
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A current account is a type of bank account with unique facilities. These types of accounts are preferred by businesses, companies, public enterprises, educational institutions because they have a higher volume of low-value transactions.
Almost all commercial banks offer a current account, i.e. both scheduled and non-scheduled commercial banks. One of the main features of a current account is that it does not earn any interest on its balance.
Benefits of a current account:
One of the best features of a current account is that it provides complete and unrestricted liquidity to the customer. Unlike a savings account, there are no restrictions on daily withdrawals or deposits of cash. Unlimited free deposits are allowed up to a particular limit. There are no limits on withdrawals of funds. This provides a lot of liquidity for businesses to manage their operations.
2. Easy account opening:
Opening a current account is very simple, especially since several lenders have the current account opening formalities entirely online. You have to fill up a form, and the customer representatives from the bank will contact you for further formalities to open a current account.
3. Overdraft facility:
One of the benefits of getting a current account is that the business can get an overdraft facility where funds are borrowed at a cheaper rate of interest as compared to a regular loan. These funds can be repaid by depositing cash into the account. An overdraft is the easiest way of infusing funds into the business.
4. Net and Mobile Banking:
Most banks extend mobile and internet banking to current account holders. A current online account makes it easy to check balances, make transfers, and have a check on the account.
5. Multi-city banking:
A current account provides a business with multi-city operations. It is possible to deposit funds from all over the country which is very useful for businesses spread geographically.
6. Other value-added services to business owners:
With the competition among banks, business owners can get a whole range of different value added services such as:
• Higher free withdrawal and deposit limits
• Cheque collection facilities
• Monthly account statements
• Relationship managers
• Discounts on other services
These value-added services help a business to save costs and expand.
7. Bank guarantees:
Having a current account with a healthy balance can help a business get a bank guarantee which is useful for companies looking to get into foreign trade.
Author Bio:- Neha Sharma is a finance student who loves to write in her free time. She has spent considerable time researching about current account opening. Through her work, she has explained its benefits
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