What is current account

Current Account This is a type of account in which you can do many transactions in a day. There is no limit in this, most of the current accounts are mainly for businessmen, firms, companies and public enterprises etc. In which you can do as many banking transactions as you want in a day. If you have a current account in the bank, then no interest will be given by the bank on your account, that is, interest will not be available on depositing money like a savings account. The purpose of opening a current account is neither to earn interest nor to save, but for the convenience of business, so that you can transact as much money as you want by the bank and as many times in a day. Hence this account is also called as Current Account. To keep the current account running, you have to maintain a minimum balance, otherwise, you can also be charged a penalty by the bank, Or your current account can also be closed. Some charge is also levied by the bank to keep this account running. Along with this, the facility of checkbook is also provided in it.

What is current account

Types of Current Account

Current account may be different in all banks, for which there are different policies. In this, we are going to give you an example of the type of current account of SBI Bank. And the policy of current account of other banks is also almost the same.

regular current account

Regular Current Account is ideal for small businessmen, professionals, traders etc who require a current account with all the features at a nominal cost. The minimum average balance in this type of account should be Rs 5000. In this, up to five lakh rupees can be deposited free of cost per month. No charges will be deducted for this and cash withdrawal and deposit facility will be available in all 22000+ SBI bank branches. Free NEFT/RTGS facility through Internet Banking and Mobile Banking. Along with this 50 multicity check free every month.

gold current account

Gold Current Account is suited to leading businessmen, professionals, traders etc. who deal in bulk cash transactions and wish to expand and diversify their operations. In this, substantial additional services are provided at discounted rates, thereby substantially reducing transaction costs. In this, the monthly minimum average balance should be one lakh. You can deposit free cash of Rs 25 lakh per month in Gold Current Account and also get the facility of free 300 multicity check per month.

Diamond Current Account

Diamond Current Account is very suitable for those reputed businessmen, top professionals, big traders etc. Which are spread across the country and deal in bulk cash transactions and a large number of payment and collection transactions. In this, the monthly minimum average balance should be 5 lakhs, in this per month Rs. Free cash deposit up to Rs 1 crore and free multicity checks up to 700 per month.

Platinum Current Account

Platinum Current Account is for customers who want the best product for themselves and their business. All major services are provided unlimited free of cost in this current account to make it convenient and cost-effective for leading businessmen, top professionals, big traders etc. to do bulk cash transactions and large number of payment and collection transactions across the country. In this, the monthly minimum average balance should be 10 lakhs, along with this many facilities are provided in it.

Conditions for opening current account

  • Current account is mainly for businessmen, firms, companies and public enterprises etc. This account is not open for the public.
  • To maintain the current account, the condition of maintaining its different monthly minimum balance is set by each bank.
  • If you do not maintain the minimum balance, you will have to pay penalty charges as prescribed by the bank, otherwise, your current account can be closed.
  • You will not be given any interest by the bank in depositing money in the current account.
  • You will be charged by the bank for maintaining the current account and providing you with additional facilities.

Who can open current account

Current account is used to facilitate transactions for small, medium and large mainly businessmen, firms, companies and public enterprises. Current account is not for the common man, a savings account is opened for them because there is only one purpose to open a current account in which there are many daily banking transactions. Current accounts are meant neither for the purpose of earning interest nor for the purpose of saving, but for the convenience of the business, hence they are non-interest bearing accounts. There is no fixed daily limit for depositing or withdrawing money in this type of account. You can do as many transactions as you want in a day.

Advantage of current 

  • Current account allows all business transactions.
  • With the demand draft facility in the current account, it becomes easy to deposit and transfer money.
  • There is facility to withdraw and deposit money any number of times.
  • Banks also generally provide overdraft facilities to people having current account. It can be more or less depending on the status of the account holder.
  • Current Account also provides many facilities like Internet Banking and Mobile Banking.
  • The bank also provides the facility of statement of transactions to the current account holders based on their demand.
  •  There is no additional charge for doing multiple transactions in the current account.

Disadvantages of current account

non-receipt of interest

The biggest disadvantage of opening a current account is that the bank will not give you any interest for the amount you deposit in the current account. Whereas banks also pay interest ranging from 4 to 6 percent on the money deposited in the savings account. Apart from this, the bank also levies a separate charge for maintaining your account, which has to be paid by the current account holder. 

Maintaining Minimum Account Balance (Current Account Minimum Balance)

The account holder is required to keep a certain amount of money in the current account. According to different banks, it can be 3 thousand, 5, thousand, 10 thousand or 15 thousand or even more. If you are not able to do this i.e. fail to maintain the required quarterly average balance, then its charge is also deducted. Each bank sets different penalty charges. Checks are used to withdraw money from the account. Banks issue free checkbooks only within a certain limit, if you use more checks, you may also be charged something for each check.

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