As far as the Current Account meaning is concerned, it is one of the most popular banking products, helping individuals and businesses manage their finances. Businesses and individuals conducting multiple transactions find Current Accounts very useful as Savings Accounts offer limited transactions. Individuals do not need to pay an additional fee for transactions. A Current Account is ideal for businesses, as the services and features of this account make ventures hassle-free and profitable.
Types of Current Account
There are many types of Current Accounts. Each Current Account type serves businesses of different natures and sizes. New business owners or start-up owners can avail of a Start-Up Current Account.
Similarly, businesses with massive turnovers and transactions often go for Premium Current Accounts. These accounts are often customised to suit a business’s specific needs. The most commonly opted-for is the Regular Current Account. This type is suitable for businesses that conduct several monthly transactions.
General Features of Current Account
Despite the wide variety of Current Accounts available in the market, they all serve a similar function. The function is to help businesses manage and monitor their finances in an optimum way. Whether your business is an SME, start-up, local, or international, you need a Current Account to operate smoothly.
Here are some of the general features that you can expect to find in almost any Current Account and which help you understand Current Account Meaning in detail:
1. Unlimited Transactions: You can make unlimited or, at the very least, a very high number of transactions through your Current Account.
2. Overdraft Facility: Overdraft is a feature that allows businesses to borrow money from their bank to facilitate transactions when they need the required funds. A Current Account has a high volume of inflows and outflows. The overdraft facility allows things to keep running smoothly no matter what.
3. Interest Rate: Most banks charge interest rates on the amount borrowed via the overdraft facility. The rate varies from bank to bank, so finding a suitable one is advisable.
4. Earned Interest Rate: Unlike Savings Accounts, account holders do not earn any interest on their account balance.
5. Minimum Monthly Balance: Generally, a minimum amount is required to be maintain to avoid additional fees. Banks have also begun to offer special privileges to new applicants, where the minimum monthly balance is null or waived for the first year.
6. Services: You can expect free NEFT/RTGS services with your Current Account. In addition, features such as Net Banking, Mobile Banking, and Cheque Collection Services are also available.
Importance of Cancelled Cheque
You have already heard this question “What is Cancelled Cheque?”
Here’s how you can cancel a cheque:
1. Take out a blank cheque from your cheque book.
2. Draw two parallel lines across the cheque. Ensure that the lines, such as the account number, IFSC code, MICR code, account holder name, bank name, or location, hide no crucial information.
3. In between the two parallel lines, write “CANCELLED.” Do not sign the cheque.
Knowing what a cancelled cheque is and how to cancel it is also important for loan disbursements, investments, insurance claims, and KYC verification. Hence, it is an important skill to know regardless.
CONCLUSION
The information shared above helps you understand Current Account Meaning, alongside ‘What Is a Cancelled Cheque‘. If you want to open a Current Account, remember to assess your business needs first and then choose the most appropriate one. The focus should be on finding the best type of account and the bank that offers the most flexible and rewarding services.
