The financial requirements of a business are very different from that of an individual. To distinguish these two, the financial institutions have devised a separate system known as Current Account.Itis dedicated to businesses to manage their financial dealings.
An account facility like a Current Account has benefits that help every business owner manage their finances better.
Advantages of Opening a Current Account
Here are some advantages of having a Current Account:
- The best Current Account bank in India provides unlimited transactions for your business. Thus, business owners can perform any number of transactions through their Current Accounts. Moreover, this account has no specified limit to the amount you can transact, which also helps organisations better manage their finances.
- The Current Account helps you to keep your personal finances separate from your business. As a result, it portrays a more professional image of the organisation. It also comes in handy while paying Income Tax and Goods and Services Tax (GST), as you need to file them separately for your company.
- Since this account keeps all the details of your transactions, the records help you to understand them better. You can access this report anytime and anywhere through the website or application of the financial institution.
- This account helps to prove your business’s authorisation. An account like this ensures that your business exists, and the transaction records help establish your company’s turnover capacity.
- Your Current Accounts can help you to get instant funds. The overdraft facility in these accounts enables you to meet your urgent financial needs without delays. This feature is useful for companies with small working capital or those struggling with urgent financial requirements.
- Another notable advantage of having this account is dealing in foreign currency without worry. The foreign currency exchange services associated with this account help you earn in other currencies and later convert them into rupees.
Disadvantages of Opening a Current Account
- There may be huge fees involved with your business transactions.
- You will not earn any interest on the deposited amount.
- There are high costs incurred if a Current Account holder requires additional services. These charges are known as service charges.
- Banks can limit the number of free chequebooks and demand drafts for Current Account holders.
Features of a Current Account
- You can access your fund 24X7 with the help of your Current Account. You can make your payments, deposits, and withdrawals at any time.
- With the help of this account, you can get an overdraft facility.
- This account allows you to set a direct debit or standing order for repayments. As a result, you don’t need to remember any due date for your recurring payments.
- It enables online banking for customers. So you can make any transaction, payment, or balance transfer anytime, anywhere.
- Some banks offer additional services for their Current Account holders depending on their eligibility.
- Banks set a limit to the amount of money that can be withdrawn from an account in one day.
These are some of the advantages and drawbacks of the current account facility. However, even as a business owner, if you do not have a Current Account, you can still use banking apps like ICICI Bank InstaBIZ. This modern banking app enables you to access a Current Account without having one with ICICI Bank. Apart from that, this app has a host of additional features like access to overdrafts, reminders for tax payments, managing online transactions, and so on.
Conclusion
Current Accounts are undoubtedly one of the easiest ways of managing transactions for a business. Adding all the benefits you get with it becomes a better method to keep business finances aside and manage them efficiently.
Get ready to manage your day-to-day business transactions by getting a Current Account today!