Current Account and it’s importance
Grow business with Current account, get business loan, limit, build relationship with your bank
Opening a current account is one of the most important tasks you must follow while starting your business. It is very crucial to keep business banking operations separate from personal banking. Having a current account for your business helps you keep track of all your expenditure while simplifying your taxation process.
Current account has all the benefits that you would typically get from your savings account. Based on your business, the bank offers free Demand Drafts, NEFT and RTGS transactions, Pay Orders, and more features. These features many times are free of cost with unlimited withdrawals and deposits you can make with your current account.
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What is a current account ?
Current Accounts allow business owners to document and track their expenses. Also to organize their cash flow and allow for easier calculations of tax liabilities. For business, it allows for deposits, withdrawals and contrary transactions. Almost all commercial banks in India allow the opening of a Current Account for business purposes.
These accounts are taken advantage of by businessmen and entrepreneurs who incur a number of transactions, on a regular basis and no interest is generated on the balance.
Why Should I Open a Current account?
It is important to consider the benefits associated with owning and operating such an account.
- Unlimited transactions – One can perform any number of business financial transactions, at whatever frequency. As a result, businesses can be assured of a high level of fluidity within their operations.
- Separation of funds – A Current Account makes it possible for business owners to keep their personal assets separate from their business assets. Transactions can be tracked easily which helps in enhanced planning and budgeting. Financial records are then easier to interpret, which helps at the time to pay taxes and consider deductions.
- Smart insights – Your business financial data is provided in an easy-to-read format, which allows for smart insights. Statements highlight exactly where and with whom the transactions are done. Real-time transactions information is helps make superior decisions pertaining to the business
- Instant operations – A Current Account makes it possible to ensure that all transactions are carried out with efficiency and on time. Without any delays on these transactions, it is possible to maintain positive relations with both suppliers and customers
- Additional Benefits – Almost all banks allow for their business clients with Current Accounts to avail Demand Drafts, NEFT and RTGS transactions and Pay Orders, free of cost, in addition to providing them with unlimited withdrawals and deposits.
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How does a current account help you grow your business?
Besides there are many benefits of owning a current account for your business, there are numerous ways which can help you grow your business. I have listed some of them here –
- Manage your business transaction on your tips through Online and/or smartphone apps. You can add Additional authorized users to the account. Generate Expense and income reports, Integrate banking with business software, automatize Financial tasks.
- Establish a Relationship With a Bank. Your business may not require much financial help at the present stage but your needs may change later as you grow. Many small business banking institutions offer a variety of business services, including cash handling management, asset management and small business loans.
- Establish Business Credit – Business credit reporting agencies use payment information to establish credit history and calculate business credit scores. Good business credit can help you secure more favorable financing offers. Also, make it easier to qualify for a loan and give your company a solid reputation.
- Qualify for a Loan, a business loan or line of credit may be necessary for business expansion. While business lenders may have different funding requirements, they generally require a business bank account in order to verify application details and/or issue funds to approved applicants.
- Business Look More Professional: Issuing payments and writing cheques in your company’s name from a business bank account rather than a personal account looks more professional.
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Conclusion
To conclude, Business owners can be assured of efficiency in transactions without worrying about the number of transactions limit. You can open a Current Account with any commercial bank in India. You must compare offers provided by different banks prior to creating a current account. This way you can manage and grow your business more professionally and easily.
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