Handling a business’s cashflow can be challenging, and choosing the right current account can make all the difference. While current accounts are specifically made for business owners and offer them specific benefits, it is beneficial for you to compare a few current accounts before choosing one for your business. The following guide explains how you can compare online current accounts based on specific criteria.
Factors to consider when choosing a current account:
If you are a business owner and wish to open a current account, consider these points while comparing current accounts online –
- Analyse if the current account is helping you meet your business objectives: You must assess your financial habits, cash flow requirements, and transaction patterns first. Having a clear idea of these factors can help you choose the right current account.
- Check for any hidden charges including transaction costs: You must be wary of hidden fees such as service charges and transaction costs. You must opt for a bank that does not charge any hidden fees.
- Check if your bank offers interest through its current account: Current accounts generally don’t offer interest, unlike savings accounts. However, some current accounts offer this feature.
- The overdraft facility can help you keep your business running during tough times: This facility helps you prepare for financial emergences by overdrawing money from the digital current account up to a certain limit when your funds are running low.
- Prioritise good customer service and accessibility: Any banking issue can only be resolved by contacting customer service. You must, therefore, choose a bank that offers good customer services and mobile banking services.
- Look for any incentives and rewards: Banks often offer key incentives and rewards through their current accounts. You can make the most of these perks if you know them while signing up for a current account.
Eligibility criteria for a current account and documents required:
Any of the following individuals can open an online current account in India –
- Non-government organisations
- Charitable trusts
- Stock and share brokers
- Foreign banks
- Domestic banks / domestic co-operative banks / regional rural banks
- Public sector undertakings
- Religious organisations / government bodies / educational institutes
- Private limited companies
- Partnership / limited liability partnerships
- HUFs (Hindu undivided families)
- Sole proprietorships
- Individuals
- Co-operative societies / societies / trusts
Here are the general documents required to open a current account in India –
- Business proof of organisational activities in the proprietary firm’s name.
- License certificate issued by municipal authorities as per the Shop and Establishment Act, CIN, GST/VAT/CST certificate.
- Registration/certificate document issued by service tax/sales tax authorities.
- Importer/Exporter code (IEC)
- Complete ITR in the proprietor’s name where the entity’s income is displayed.
- License/certificate of registration as per the government’s Statute/Act.
- TAN allotment letter by the NSDL in the name of the organisation.
In summary, you must opt for a current account that offers overdraft facility, has no hidden fees, offers beneficial rewards and incentives, and has a reliable customer service team.
