Types of Bank Accounts In Nigeria you can open
Commercial bank in Ngeria hold different kinds of deposits these are the current account, and fixed desposit account and savings account etc.
In Nigeria Different types of bank accounts serve different needs. Depending on your goals, it’s wise to put money into the best account and use the right tools for spending and saving. Doing so allows you to maximize the return from your bank, minimize fees, and manage your money conveniently.
What Is a Bank Account?
A bank account is a financial account maintained by a bank for a customer. A bank account can be a deposit account, savings, current account.
- Current Account
This is operated through the use of teller for deposits and cheque for withdrawing of money it can also be withdraw through ATM or online portal for payment .This account does not attract interest rate.customers are expected to pay certain commission to the bank call COT
Opening a current account is generally easy, especially as banks continue to simplify the process. However, certain information and documentations will be insisted on to meet regulatory and relationship management requirements. These include
1 a few basic forms to capture personal or company information;
2 identification (driver’s license, international passport or any other ID 3 acceptable to the bank) for the account signatories;
4 passport photographs of signatories;
5 certified copies of company registration certificate and form Co7 (originals for sighting);
6 References (usually two referees who must satisfactorily operate current 7 account in a bank). For a corporate account, corporate referees are required.
Flexible to operate – you can pay in and withdraw as frequently as you need to;
Is a checking account: you’re able to issue cheques and avoid the risks and costs of excessive cash transactions;
You can lodge cheques for clearing, meaning you can equally receive cheques from your customers;
You may enjoy a clearing gap when you pay by a cheque. The cheque may not come into your account immediately which may be beneficial for your cash flow management;
You can receive references from the bank to third parties
You may borrow on this account and receive a range of ancillary services.
Usually, you are charged monthly commission on the debit turnover on the account and this could be a sizable amount if the account is very active. However, not that some banks now offer COT-free accounts.
Interest is not usually paid on current account balances. If credit balances are high, this could mean substantial loss of earnings unless you take extra steps to invest short-term balances.
2. The savings Account.
The account are operated to meet the requirement of smaller depositors. The savings account operated through the use of deposit slip for deposits and withdrawal slip for withdrawing it can also be withdraw through ATM or make payment via online portal. Savings account attract s small rate of interest on the balance .
Summary Features of Savings Account:
Money can only be withdrawn occasionally if interest is to be paid
It attracts favorable interest rate
Holders are issued passbook (I know you’r wondering, in this age, do banks still give passbooks?)
Withdrawals cannot be made by another person on behalf of the customer
Identification (international passport, driver’s license ,voter’s card)
Account opening amount, which is usually low
Easy to open with minimal requirements
Encourages savings and accumulation of reserves
Pays interest on account balances
No commission is charged
3. The Fixed deposit Account.
It allow large sum of money which does not allow frequent withdrawal or by cheque .A time notice is expected from the customer before any withdrawal could be made. This is because the amount is placed in the bank for definite period of time. It does earn depositors some interest.
The demand deposits are held as working balance .i.e as fund needed in the transaction of daily business and cannot be invested.
The savings deposit provide the bank with reservoir of fund as purchasing power for the future, such funds are usually accumulated by individuals over a long period of time for non –specific purpose such as for the rainy day, retirement or unknown personal emergency.
4. Domiciliary Account
This type of account allows Account holders the privilege of transacting in dual currencies (Naira and another foreign currency). Most banks have options for only the dollar, euro and pound sterling however. This account type will most likely suit businesses and other corporates and few individuals who have regular business dealings in foreign currencies.
flat charge is usually made on each transaction. In addition, for transfers made from foreign banks, holders of this account will be subject to a service charge in the foreign currency of choice.
With domiciliary accounts, deposits can be made in the foreign currency of choice and there is usually no limit to the number of withdrawals.
This account type will most likely suit businesses and other corporate and few individuals who have regular business dealings in foreign currencies.
5. Joint Bank Account
From its name, two or more individuals in the eyes of the law, are regarded as the owner of the account. So, all parties to the account are signatories to the account.
Having a joint bank account is the same as having your own, except two people have control over the account, including any arranged overdraft (subject to approval). Both people can spend money from the account,
6. Corporate Account
A corporate account refers to an account that specializes in offering services for companies and offshore businesses. Its differentiation from personal and investment bank accounts lies on the fact that it provides services targeted directly to businesses.
This is a typical business account. It can be opened for any registered business.
To open a corporate account in Nigeria, you will need the following documents:
Certificate of Incorporation
Tax Identification Number (TIN)
SCUML Certificate or Letter of Exemption
Valid IDs of Directors (photocopies)
Passport photo of each account signatory
Also Read: History and origin of Banking in Nigeria
You’ll have to fill the corporate account form presented to you by your bank and must also present the documents listed above.
Next, you will make a payment of 5,000 Naira. This payment is to verify that your certificate of incorporation is valid.
Since corporate accounts are created particularly for registered companies, their minimum capital requirements for opening the account differ from those of a SAVINGS or an Current account.