Financial Plan

Steps to follow when opening a bank account

It is easy enough to open a bank account if you follow the bank’s procedures and fill out the paperwork correctly.

With every person working hard to create wealth for himself and his family, it is important to have an instrument where one may set aside the money earned. It is inadvisable to keep cash at home, hence it must be deposited in a safe place.

A bank account is such a safe place. One may deposit cash and cheques in the account, and rest assured that his money is recorded and accounted for to the last rupee. He may withdraw funds whenever required, and deposit them when he has surplus money. However, the bank account opening process must be followed properly.

Normally, the bank account opening process goes thus:

* Decide on the type of account: You can choose between savings, current and corporate accounts, based on your needs.

* Select a bank that is close to your home/place of work: Depending on why you need to open a bank account, i.e. for personal or professional purposes, select the bank branch closest to you. If it is a savings bank account, the bank should be close to your place of residence so that you can go to the bank easily whenever needed. Similarly, a current account must be operated close to your place of work. Also look for a bank that has enough branches in the city where you reside so that you can bank at a branch when you are away from the main office.

* Fill out the paperwork: The bank will give you the application form and a list of proofs that you must submit with the completed form. The proofs will include residence proof (passport, Aadhar card, electricity or phone bill or ration card), income proof (if employed), PAN card copy, etc. The form will ask for personal and professional details, latest passport size photographs and at least two specimen signatures. Banks also need references from at least two persons not related to the applicant. You can even ask the bank if it allows online bank account opening.

New age banks have taken the account opening process a step further – customers can now open accounts online in a matter of minutes. They can upload the requisite documents (address proof, personal ID proof, etc.) online and get started. However, these are largely restricted to basic savings bank accounts.

* Submit the form for verification: The completed form must be submitted to the bank, which will then verify the details filled. At this time, the applicant will be asked to deposit a certain amount of money to open the bank account. The account is deemed operational at this point if it is a savings account. In case of a joint stock company, the company’s Board of Directors must append a resolution with the application form while submitting it.

Some banks allow online bank account opening, in that one may apply for the account online. However, the completed application form must still be filled out and submitted to the nearest bank branch. The account is deemed operational only post verification and depositing the opening