Know everything about current accounts: four-way payments in India

A current account is a deposit account created at the request of the applicant, which can be accessed frequently or instantly. Individuals who regularly carry out a large number of banking operations should maintain a current account, which is associated with a liquid deposit and offers a wide range of personalised solutions to assist with financial activities.

Types of current accounts

When opening a current account, you should fully understand your needs. Types of current accounts include:

Standard current account

This is a non-interest bearing account with a minimum balance requirement as well as a predetermined average monthly balance. Other benefits may include free RTGS and NEFT transactions, SMS banking, online banking, and more. Cheque books, debit cards, overdraft facilities, etc. are also available.

Packaged current account

The package account offers a wide range of benefits to account holders. It also includes other services such as roadside assistance, health care and travel insurance.

Single-column cashbook

As the name suggests, this is a cash book that records daily transactions with separate columns for debits and credits. It is suitable for businesses that do not have bank accounts. These accounts allow daily transactions but lack features such as overdrafts.

Premium current account

The Premium Account offers special discounts and benefits to account holders. The account offers a wide range of personalisation options and is usually suitable for people who carry out a lot of financial activity.

foreign currency account

A foreign currency account is the most appropriate choice for individuals or businesses that regularly need to conduct transactions in foreign currencies.

Difference between current account and savings account

One of the basic requirements for conducting business is having an active bank account. In order to meet the diverse needs of businesses, banks now offer a wide range of attractive current account offers and incentives. Below are some of the basic features of a current account compared to a savings account:

- Allow unlimited trading

- Higher minimum balance required

- Simplification of frequent transactions, such as fund transfers, cash withdrawals and cheque deposits

- Operated by individuals, private and public companies, trusts, associations, etc.

- Unlimited number of transactions per day

- Penalties may be incurred if the minimum balance is not maintained

- KYC rules for savings accounts also apply to current accounts

- A single company cannot open more than one current account

Documents required to open a current account

Typically, you may need the following documents:

- identity cards

- proof of address

- Partnership agreements for partnerships

- Proof of identity and address of all partners

- Passport-size photograph of the applicant

- Cheques from existing savings accounts

However, please note that the documents that may be required may vary from bank to bank.

Note: Please ensure that your KYC document is still valid on the date of submission.

concluding remarks

A current account is useful when you need fast transactions, unlimited withdrawals, deposits, and overdraft services. It is a must-have option for business accounts these days. In addition, a current account allows you to use your bank's checking feature to pay debtors. Compared to savings accounts, current accounts usually do not pay interest and have higher minimum balance requirements. However, the biggest benefit of a current account is that account users can easily use a certain amount of overdraft.

Frequently Asked Questions

What is the minimum balance in a current account? Generally, the minimum account balance starts from INR 10,000 but may vary. What is the interest rate on a current account? Usually, the interest rate on a current account is zero, but some accounts offer a certain interest rate. Which is the best bank to open a current account? Top banks like ICICI, HDFC, SBI, Axis Bank and Bank of Baroda can offer attractive current account deals. How to open a current account? A current account can be opened offline or online. You can complete the application process by visiting the official website of the bank. In what ways can I deposit cash in a current account? Cash deposits can be made in the following ways: digital transfers, cheques, wire transfers, deposits at bank branches.