The current account can be described as among the kinds of deposit accounts only accessible to businesses. It functions as a savings account but offers distinct benefits regarding unlimited transactions, broader overdrafts, and quick financing options. Current versions are reserved accounts for business-related transactions. No interest is charged or due on a business’s existing performance. However, the minimum balance is more hefty than a standard savings account.
Let’s now examine the five ASIC advantages of having a current account for companies:
1. Transact With No Minimum Balance – Overdraft With Current Account
The most appealing feature of a current account is that it has an overdraft option. If your account is without a minimum balance, the facility for overdrafts available for current accounts can help. It can help you manage crucial payments to vendors and operating costs while you wait for a lump sum payment. The money you earn is credited against the balance drawn, and your account is restored to its regular condition. This provides a chance to breathe for business owners facing cash pressure.
Additionally, the interest rate on an overdraft may vary from 10% to 13%. Therefore, entrepreneurs prefer an overdraft option linked with a bank account rather than seeking new funding. This is the main advantage that a current version has over a traditional savings account. Savings accounts cannot be drained at any point.
2.No Limitation On The Volume Or Amount Of Transactions
Businesses are constantly evolving and growing. This could be a rise in sales volume, introducing new products, business lines, or branch offices, opening new branches, and expanding geographic areas. If you have an active account for your company and are not billed additional or subject to restrictions as your business grows. You are not limited to the amount and quantity of transactions. It is possible to transact quickly, and your current account is a companion to help you grow your business.
3. Constant Support
The operational assistance you receive from your banker when you have the current account is incredible compared to a a savings account.
- You can use unlimited cash books and cheques. This is all free.
- The banker will often inform you about the clearing of your cheque as well as discounts on the bills.
- You will receive timely alerts each time you’re about to get out of credit.
- You may request an increase in the amount of your overdraft based on a solid connection with your banker.
4. A Leverage For Loans
A brand new loan term or an equipment loan is a daunting job if you have weak experience in finance. Your current account serves as a model of your financial status and the business’s performance. Your banker has an accurate comprehension of your cash flow and repayment capability, as well as the cash flow in your company when you have an active account. This is why you can take out a term loan or cash credit facility at a low cost and attractive rates. Instead of starting from scratch to get funding, you can start by opening a current account for your business to establish the business’s security.
5. Transparency And Visibility
A business current account is just like any other kind of bank account. Cash inflow, outflow,, withdrawals exceeding limits, withdrawal times, and the nu of cheque transactions online, cheque transactions, and discounting bills are documented. Therefore, you will have a well-organized log of all crucial business transactions. A current account for business assists in correctly maintaining the book of charge for your company.
Other Benefits
- Separation of business and personal transactions
- Acquiring other banking services, such as discounts, letters of credit for bills, etc., is simple.
- Facilitates smooth transactions in business.
- Unlimited deposits through the branch at home.
Conclusion
Having a current account in your business is beneficial in many ways. Your existing account could be a comprehensive report of your company’s performance. It could help you forecast your business’s future cash flow. Please find a current bank account for your company and then set it up.
