5 Types Of Current Accounts You Can Open In India

by Rishank Rautela Financial Planner

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A current account is a type of account that allows its holders to conduct significantly higher, regular banking transactions. Such accounts are ideal for small and medium businesses that need to withdraw and/or deposit sums into their account to fund their business needs. Business owners can open a single current bank account and conduct transactions in any branch of their bank across India. This means that even if you have multiple branches or franchises of your business, a single account is sufficient. Here are the different types of current bank accounts you can open in India.

Standard account

This is the most common type of current account that most new business owners opt for. A standard current or business account is typically a non-interest bearing account. You need to maintain a lower minimum balance in this account, as compared to other business accounts. This account comes with all the basic essentials including cheque books, passbooks and debit cards. You can also avail overdraft facilities with this account. If you have a personal banking relationship with a particular bank i.e. if you have a savings account or fixed deposits with a particular bank and are just starting your business, it is best to open the standard account with that bank.

Premium accounts

Business owners looking for exclusive offers and benefits can select premium current account opening option. Such accounts come with several customised features and are ideal for business owners who need to carry out high value, high frequency transactions on a day-to-day basis. Premium accounts also provide the account holders access to important features such as regular internet and mobile banking, SMS banking and free and frequent National Electronic Funds Transfer (NEFT) and Real-time gross settlement (RTGS) transactions among other things.

Packaged Accounts

This is another current account opening option that business owners have. Such an account comes with a wide range of perks and facilities that account holders can benefit from. A packaged account stands apart from the other types of current bank accounts in that it comes with special, additional features which include medical support, travel insurance, vehicle insurance and road-side assistance among other things. Such accounts are ideal for businesses in the packers and movers category.

Foreign currency accounts

Some businesses may have clients outside of India. They may also have branches of their business in overseas territories. For instance, several Indian jewellery brands have branches in foreign countries. As such, any business that has trade relations in overseas territories can benefit from opening a foreign currency account. You need this account to carry out foreign currency transactions. It is easier to open this type of account with a bank with which you have an existing personal banking relationship.

Single column cash book

Also known as simple cash accounts, a single column cash book allows you to conduct your daily business transactions but does not come with an overdraft facility, unlike all the above mentioned current accounts. It is ideal for businesses that prefer not to maintain bank accounts in general. This cashbook simply records your daily transactions under separate debit and credit columns. Also, banks charge lower account maintenance fees for single column cash books.

Most banks today allow their customer to open current account online. However, you need to have all the necessary documents in order before you begin the online account opening procedure. You can provide scanned copies of the documents with the account opening form. In some cases, the bank may even send a representative to your home to collect hard copies of the account opening documents.