What is a current account?
In India, the banking sector offers two distinct types of bank accounts: savings and current accounts. The latter is mainly created for business purposes, while savings accounts are more suitable for personal finances.
Often used by businesses, trusts, sole traders and other associations, a current account operates much like a standard bank account. It offers numerous advantages such as uncapped withdrawals and deposits, free monthly cheque usage, the convenience of transferring funds across branches, and includes an overdraft facility. Given these features, such accounts are crucial for professionals, business owners and organisations.
The process of opening a current account is straightforward and often swift. Whether through an offline or an online interface, you can set up your account at your chosen bank. To select the most suitable current account, understanding the specific needs of your business is key.
Before your account is activated, the bank will request certain documents. Here are the different types of documentation required for commencing a current account:
Proof of identity:
For vendors, business owners, professionals and companies, PAN cards are widely accepted. Other valid proofs include Voter ID, driving license, and passport. Phone and utility bills can serve as evidence of your address.
Proof of existence of your company:
The following documents can validate your company’s authenticity:
A foreign trade permit issued by the Director General of Foreign Trade.
Licenses and registrations by municipal corporations. As per the Bombay Shops and Establishments Act 1948, possession of this is mandatory.
Professional tax registration certificate.
GST registration certificate.
State government business registration certificate.
Registration certificate from SEBI or the Reserve Bank of India.
Licenses granted by the Food Safety and Standards Authority of India (FSSAI).
Verification of your business address:
Income Tax Bills, Property or Water Tax Allotment Letter.
Tax Deduction and Collection Account Number (TAN).
Property registration documents.
Financial declaration documents.
Proof of property ownership or rental registration documents.
For Non-Resident Indians (NRIs), the following additional documents may be required:
A declaration stating non-involvement in print media, real estate, or agricultural businesses.
Evidence of funds routed from a non-resident ordinary or non-resident rupee or non-repatriable foreign currency account.
For a Limited Liability Partnership, the needed documents include:
Limited Liability Partnership certificate.
KYC documents for all partners.
Limited partnership liability contract.
Proof of the chosen partners’ roles as signatories.
List of partners with assigned IDs provided by the Ministry of Corporate Affairs.
For a Public Limited company, the documents required are:
A startup certificate for the company.
Memorandum of association.
Incorporation certificate.
List of company directors.
Board resolution indicating identified signatories.
This guide should provide you with a comprehensive list of the documents needed to open your online current account.
