Current Account

Banks provide different types of current accounts keeping in consideration the different banking needs of their customers. One should choose the type of account best suited for the nature of transactions one wishes to carry. Below mentioned are the different types of current accounts provided by majority of the banks. However, it is to be noted that the type of current account may vary from one bank to another.

1. Standard Current Accounts – This type of account requires the customer to maintain a minimum monthly average balance. The account does not provide any interest on the deposited amount. However, it provides cheque book facility, debit card, overdraft facility etc. to its customers.

2. Basic Current Accounts – It is ideal for customers with low wage income like pensioners, young people etc. It helps the customers to manage their finances rather easily. However, there are some restrictions on the daily cash withdrawal limit.

3. Premium Current Accounts – This is a kind of account that comes with exclusive offers and benefits to the customers. This account is best suited for carrying out large value transactions.

4. Packaged Current Accounts – This current account type provides the account holders with lots of perks and benefits. It comes with exclusive features like medical support, travel insurance and more.

5. Foreign Currency Accounts – Foreign Currency Accounts are offered to NRIs or individuals who want to carry out frequent transactions in foreign currencies.

Current Account minimum balance requirement and maintenance of monthly average balance (MAB) varies from bank to bank. Given below is the comparison of monthly average balance (MAB) requirement on some of the regular current account variants offered by different banks.

Bank Name	Monthly Average Balance	Cash Deposit limit
HDFC Bank (Regular Current Account)	Rs 10,000	Free up to Rs 2 lakh per month
ICICI Bank (New Start Up Current Account)	Zero**	Free up to 50 times of MAB maintained during transaction month
Axis Bank (Normal Current Account)	Rs 10,000	Free up to Rs 2 lakh per month
SBI (Regular Current Account)	Rs 10,000	Free up to Rs 5 lakh per month
IndusInd Bank (Indus Gold Current Account)	Rs 50,000	Free up to Rs 6 lakh per month
Canara Bank (Privilege Current Account)	Zero**	Free up to Rs 5 lakh per day
Yes Bank (Business Value Current Account)	Rs 10,000	Free up to 2 lakh per month
Punjab National Bank (PNB Silver Current Account)	Rs 5000*	Free up to Rs 2 lakh per day
Kotak Mahindra Bank (Regular Current Account)	Rs 50,000*	Free up to 5 times of MAB (previous month)

Note: For PNB Silver Current Account, Rs 5000 is the initial balance, however Rs 1 lakh is the minimum quarterly average balance needs to be maintained by the user.

*The amount mentioned is to be maintained quarterly by the account holders.

**This is the initial account opening balance, however the user needs to maintain the average monthly or quarterly balance as per the chosen account variant.

Current Account has been provided by banks to cater to the banking and financial needs of businessmen, traders, professionals etc. Listed below are some of the basic features and benefits of a current account:

• It is specifically designed to facilitate frequent transactions like fund transfers, receiving cheques etc.
• A current account can be opened by individuals, public and private companies, proprietors, associations, trusts etc.
• Similar to savings account, KYC guidelines need to be followed in case of current accounts too
• There are no restrictions on the number of transactions carried out in a single day
• There are no limits on cash deposit in the home branch
• It allows prompt business transactions enabling the account holders to make direct payments using cheques, demand drafts or pay orders

All individuals possessing acceptable KYC documents are eligible to open a current account at a bank. One can approach any bank with the requisite documents to open a current account. Current account holders are required to maintain minimum monthly average balance (MAB) in their account, failing of which they can attract penalty. Following is the eligibility criteria that individuals need to fulfill to open a current account in India:

• Sole Proprietor
• Partnership Firms
• Limited Companies
• Societies / Clubs / Associates
• Hindu Undivided Family (HUF)
• Trusts
• Individual
• Executors, Administrators and Liquidators

A current account can be opened in any commercial or non-commercial bank. The customer needs to visit the nearest bank branch will all the required KYC applicable documents. All these documents need to be submitted along with the application form. Account holders can opt to open a current account online as well as offline.

Steps to open a Current Account Online

Step 1: Visit the official bank’s website in which the customer wishes to open an account.

Step 2: Go to the online Current Account opening form.

Step 3: Fill all the required details in the ‘Personal Details’ & ‘Account Details’ section.

Step 4: Download the filled Current Account opening online form and take a print out.

Step 5: Visit the nearest bank branch along with the filled form and the required KYC acceptable documents required to open Current Account.

One can also visit the nearest bank branch along with all the documents and fill out the application form offline. It is to be noted that the steps may vary from one bank to another. The list of documents varies in accordance with the chosen account type.

Below mentioned is the list of KYC documents (proof of name, address and activity of the concern) required for Current Account opening. However, the current account opening documents may vary from one bank to another and the type of account chosen.

Documents Required

PAN Card Partnership Deed (in case of Partnership Firm) Certificate of Incorporation, MOA & AOA (in case of Companies) Certificate by Sales Tax or Service Tax authorities (in case of Proprietorship Firm) Address Proof of the Firm / Company / HUF ID Proof and Address Proof of all directors / partners A cheque for opening bank account Photograph

Any one of the below mentioned list ID and Address proof needs to be submitted along with the current account opening form:

ID and Signature Proof

Passport PAN Card Driving License Voter ID Card Aadhaar Card Employee Identity Card (in case of government employees)

Address Proof

Rent Agreement Bank Statement Voter ID Card Ration Card Passport Driving License Utility Bills (water, electricity etc.)

The main purpose of opening a current account is to perform all the business transactions smoothly. It allows the customers to manage bulk transactions and large value payments conveniently. Therefore, it is rather important to make the correct account choice. All the parameters should be kept in mind while choosing the most suitable account option. Given below are the essential parameters one should keep in mind while making the correct current bank account choice-

Minimum Balance: Minimum balance is the amount of money which must always be present in the user’s account in order to prevent the account from deactivating or lapsing. For current bank account, the minimum balance value is relatively higher in comparison to savings account. The user needs to keep in mind this factor as the minimum balance requirement varies from one account variant to another. 

Fees, Charges and Overdraft Costs: The fees and charges varies from one particular account to another. The users need to keep in mind important parameters like cash withdrawal charges, demand draft charges, funds transfer charges, overdraft costs and more.

Cash Deposit Limit: The free monthly cash deposit limit may vary from bank to bank and from one account variant to another.

Q. Which bank is the best for opening Current Account?

A. All the banks provide various types of current accounts in India. However, keeping in consideration the minimum current account balance factor, ICICI Bank and Axis Bank offer an option of Zero Balance Current Account.

Q. Who are eligible to open a Current Account?

A. A current account can be opened by individuals, private and limited companies, partnership firms, HUF, trusts etc.

Q. Is GST number mandatory for opening current account?

A. No, there is no specific requirement of GST registration for having a Current Account.

Q. How much money should be kept in a Current Account?

A. It is always advised to be aware of the minimum balance requirement in each of the current account option provided by the bank. Account holders should maintain their account balance as per the minimum balance requirements of their current account.