The current account is a bank account which is used and opened by a businessman, companies, enterprises, firms, etc. to process regular day to day transactions of a business. It includes withdrawals, deposits, and contra transactions.
In this account, the transactions can be deposited and can be withdrawn at any time. The current account can be opened in most of the commercial banks of the country. The transactions in this type of account can be processed using cheques, bank transfer, credit card, debit card, etc. Such accounts are also called demand deposit accounts. In India, there are many banks that offer current account services some are Axis Bank, SBI, ICICI Bank, Kotak Mahindra Bank, etc.
Types of Current Account
- Basic Current Account
- Standard Current Account
- Premium Current Account
- Packaged Current Account
- Foreign Currency Accounts
- Basic Current Accounts– This type of account is for the low wage income people like young youth, etc because it helps its customers to manage their financial transactions easily. However, there are some barriers to the daily cash withdrawal limit.
- Standard Current Account- This is a type of non-interest deposit account. In this type of account, the customer needs to maintain a minimum monthly average balance. It provides various facilities like debit card facilities, checkbooks, internet, and SMS banking, overdraft, etc.
- Premium Current Account- As the name premium suggests this account provides its customers with a lot of premium and exclusive offers. This account suits the people who carry a large number of financial transactions.
- Packaged Current Account- This account also provides some of the exclusive offers and features less than a premium account. It provides various insurance like health insurance, travel insurance, etc.
- Foreign Currency Account- This account is best for the individuals who have to send or receive money in foreign currencies.
Benefits having Current Account
- It helps various businesses to carry out financial transactions easily and properly.
- The businessman can send and receive money from its creditors and debtors by just clicking a few buttons.
- The funds can be transferred and received at any location.
- No restrictions on the number of transactions.
- Direct Payments are allowed using cheques, demand drafts, fund transfer, etc.
- Funds can be transferred electronically
- Many benefits and offers are given by the banks to the businessman while opening a current account.
- Cash withdrawn can be made without any limitations.
- The Current account also provides a small amount of interest-earning on the current balance which makes it more interesting.
Documents required to open current account
- PAN Card
- Passport Size photographs
- (In case of a Partnership enterprise)Partnership deed
- (In case of Proprietorship enterprise) Certificate by Sales Tax or Service Tax
- Address proof and ID proof
- A cheque
- Certificate of Incorporation
As the name suggests saving accounts is the type of account that can help you in saving money and it also helps you to earn a modest interest at the same time.
Types of savings account
- Salary savings account
- Regular savings account
- Senior citizen savings account
- Children savings account
- Women savings account
- Salary savings account- These types of accounts are open by large organizations so that salaries can be distributed to their employees in an organized manner.
- Regular savings account- This is the most common type of savings account. With the help of this account, funds can be transferred, cash can be withdrawn, money can be deposited very easily. This account is perfect for day to day financial requirements and needs. Additionally, with the help of these interests can also be earned easily.
- Senior citizen savings account- This account is solely for senior citizens. This usually comes with various health benefit plans, investment plans, etc. These are offered to the Indian citizens who are over-aged 60.
- Children savings account- This is the savings account for parents who want to keep some amount of money for their kids. This account also helps children to access their debit cards with the permission of their parents. With help of these children can learn money-saving at a very young age.
- Women savings account- This account can be opened by women and it is different from a normal savings account. This is to fulfil the requirements of women and can be used for various purposes like cash pickup, delivery, shopping, etc.
Also read: Debit Cards And Credit Cards: The Difference
Benefits having Savings Account
- No lock-in period
- Bill payments
- International debit card
- Cash withdrawn facilities
- Higher interest rate
- Insurance coverage
Documents required to open a Savings account
- PAN card
- Passport size photo
- Driving License
- Voter’s ID
- Employee ID
- Bank passbook
- Ration card
- Address proof
Current Account & Savings Account: The Difference
|Current Account||Savings Account|
|Mostly used in Business transactions||Mostly used by individuals|
|Interest cannot be earned||Interests can be earned|
|The minimum required balance is high in the current account||The minimum required balance can be low in a savings account|
|The transactions can be unlimited||A limited number of transactions are possible|
|Overdraft facility is available||Overdraft facilities not available|