5 tips on banking

Personal Current Accounts – Part I

 

Opening an AccountDo you need a Current Account 

If you need to issue cheques to various payees or you receive payments by cheques then you will need a current account. If not, an interest bearing savings account may be an option since Central Bank of Sri Lanka does not allow banks to pay interest on current account balances and a charge is levied by banks on issue of cheque books to be used on the account.

You can open a personal current account as an individual account in your name only or jointly with one or more persons as a joint account. For a joint account you must inform the bank whether the account is to be operated by any one of the joint account holders or jointly by all account holders. Banks generally will not open current accounts for minors, who are below 18 years of age as they have no legal capacity to contract.

A sole proprietor may use a personal current account for his business by registering it by producing the Business Registration Certificate the original of which should be produced for perusal and a photocopy furnished for the bank records. 

 

Documents required

You will be required to furnish the bank their mandate form duly completed, specimen signature card for each accountholder, duly completed Personal information form in order to comply with ‘Know Your Customer’ regulations imposed by the Central Bank of Sri Lanka, documentary proof of your address in the form of a utility bill or other document acceptable to the bank. You must also produce your National Identity Card with a photocopy thereof.

 

Introducing the account

Your account will have to be introduced by a person acceptable to the bank, usually an existing current account holder of the bank. This is to confirm that you are a fit and proper person to open and maintain a current account and that you are not impersonating some other person This is a legal requirement and therefore mandatory. 

 

Initial deposit

The quantum of the initial deposit you have to make will vary from bank to bank and from branch to branch. The branches located in smaller towns generally require a smaller initial deposit. You must to make the initial deposit in cash unless special arrangements have been made with the bank to make the deposit by cheque. 

 

Minimum balances

Ensure that you conform to the minimum balance requirement of your bank branch. Banks require such minimum balances to be maintained in the current accounts in order to compensate for the cost of services provided to you on the account holder free of charge. Failure to maintain such balances will result in a service charge being levied on the account.

(Please note that this is based on 

current practices and may vary 

from bank to bank)