How To Choose The Best Current Account for Your Business?
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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.
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01 AUGUST, 2023
Whether you run a small business or a huge organisation, a Current Account is essential for seamless business transactions. Often, small enterprise owners think they can easily manage all their bank transactions without a Current Account through their Savings Account. However, soon they tend to realise that a Current Account opening is necessary for a streamlined business banking process and business growth.
Here is a comparative analysis of different Kotak Current Accounts available in the market to help you decide on a suitable account for your business. The procedure for opening a Current Account and the documents you must keep handy for a hassle-free bank account opening process is also discussed.
Different types of business Current Accounts offered by Kotak Mahindra Bank
Astra 15 Current Account offers high waivers on deposits and withdrawal fees, free NEFT, RTGS and chequebook facilities, waivers on cheque deposit fees and a wide range of features crucial for the growth of big enterprises.
Some of these features include the provision of a business platinum debit card with a daily transaction limit of Rs 3 lakh and a daily withdrawal limit of Rs 1.5 lakh, Kotak ActivMoney facility to automatically convert Current Account balance into term deposits to earn FD-like interest of 7%* p.a., access to higher unsecured overdraft option of up to Rs 15 lakh for short-term business needs, and free unlimited demand drafts.
Astra 05 Current Account offers a wide range of benefits best matched to big businesses' needs, including waivers on withdrawal charges and cash deposits, cheque returns and deposits, and free money transfer facilities – NEFT, RTGS and chequebook.
Other important features include free outstation cheque collection, unlimited free demand drafts, free cheque collection via speed clearing, free alerts through SMS and email, cash management service, provision of Kotak ActivMoney option and overdraft facility.
This business Current Account has unique features and benefits that assist you in generating interest on the idle funds in your Current Account. Balance over a fixed, predetermined limit is automatically transferred into a Fixed Deposit earning you FD-like interest of 7%* p.a. The best part is that the fund that is transferred to a deposit account is highly liquid i.e., in times of any financial urgency, you can liquidate the parked Fixed Deposit amount without paying any penalty for the premature withdrawal.
Besides this benefit, the account also offers a flexible cash deposit option, free cash withdrawals at the home branch, free cash withdrawals of up to Rs. 5 lakh per day from non-home branch, free unlimited demand drafts, and a waiver on outward cheque returns.
Additional Read: Do current accounts have a minimum balance requirement?
Ace Current Account aims to efficiently manage various banking needs of big businesses without maintaining a high quarterly balance. Like other Kotak Current Accounts, Ace account also permits a high daily purchase and withdrawal limit, provides Kotak ActivMoney facility, unsecured credit access through overdraft facility, and free demand drafts.
While Elite Current Account is a premier account, it allows a comfortable average quarterly balance requirement of just Rs 1. lakh, and a wide host of features like free demand drafts, overdraft option, waivers on withdrawals and cash deposit, free RTGS and NEFT facility through net banking and at a branch, better forex rates and trade services, cash management services, POS (point of sale) solutions, etc.
A Startup Premium Current Account is bundled with offerings to enhance the growth of a startup by providing benefits like non-maintenance charge waiver, preferential pricing on import and export services, and provision of safe and bulk transactions.
Other important features include free NEFT/RTGS transactions through net banking or branches, free cash withdrawal of up to Rs. 1 lakh per day at non-home branch locations, free cheque collection and payment pan-India, and free outward cheque returns.
Parting thoughts:
Besides the above account variants, other Kotak Current Accounts are Startup Regular Current Account, Pro Current Account, Global Trade Current Account, Merchant One Premium Current Account, Merchant One Current Account, Edge Current Account, and Neo Current Account.
Some common benefits these Current Accounts offer are better forex rates, cash management services, free 24x7 mobile, net, SMS, and phone banking, faster outstation cheque collection, free cheque collection via speed clearing, free cash withdrawal at a home branch location, etc.
For selecting a suitable Current Bank Account, you must factor in parameters like minimum balance requirement, online core services, perks and privileges offered, overdraft facility, ActivMoney facility, transaction charges, etc.
Once you have determined your preferred Kotak Current Account, hit on the apply now option on Kotak’s Current Account webpage to fill-out the application form and upload the required documents. Note that for a hassle-free account opening process, you must keep the necessary documents handy to show your business proof, address proof, and identity proof.
*For deposits above 7 days. T&C apply. For detailed terms and conditions, please visit www.kotak.com. ActivMoney (Auto Sweep) is a facility of automatically sweeping out funds above a pre-specified threshold from your Current Account to a Term Deposit (TD) Account for 180 days. In case of insufficient balance in the Current Account, the TD will be broken prematurely and the required amount will be transferred to the Current Account. Default Sweep Out and Sweep In for limit for an account variant are the minimum thresholds and one will not be able to opt for limits lower than these. AutoSweep out of funds above a pre-specified threshold from Current Account to Fixed Deposit will be for 180 days (For NRE accounts it will be for 1 year) and in multiples of Rs. 10,000/- The nomination registered for Current Account will apply for FDs created through ActivMoney. If the customer opts for ActivMoney in an account, standalone Fixed Deposits cannot be linked to that account. Terms and Conditions guiding the fixed deposit will be applicable to Fixed Deposits booked under ActivMoney. Bank may at its absolute discretion discontinue/suspend any of the services completely or partially with or without any notice to the customer. The rate mentioned is applicable for Fixed Deposits less than Rs. 2 Crores for a tenure of 180 days and is subject to change without prior notice. For ActivMoney (2 way sweep deposits), Regular Kotak Fixed Deposit rates will be applicable, basis the tenor of the deposit, for all customers including Senior Citizens/Bank Staff without any pre-payment penalty.
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