How to open a bank account for your business

by Swati Bucha on 02/03/2017
As one of the first steps of starting a business, you need to set up a bank account specifically for your business. Not sure how? The process is simple, and we've broken it down into separate steps for your understanding. Using this article as a checklist; you'll be better prepared to open your bank account.

Decide the type of bank account
A bank account keeps your money safe and also adds to your income by paying interest. There are different kinds of bank accounts – savings account, fixed account and recurring deposit. Usually, the first account that you need to open is a savings account. You can keep your money in this account and withdraw whenever you want to. However, banks usually require you to keep a minimum balance in this account (the amount may vary from bank to bank). Businesses also use current accounts as it may yield certain benefits.

Choose a bank and fill up the bank account opening form
Once you have decided on the type of account you want, you should probably approach a bank of your choice and get a proposal form (Account Opening Form). The account opening form contains details such as your name, address, contact number, occupation, and other details. Ensure you have all your relevant details at hand to fill the form. If you’re applying for a joint account, it must be signed by both the applicants. You may be required to submit your latest photograph for identification purpose.

Give references for opening your Bank Account
Usually, banks require references by any of the existing account holders for opening the account of a prospective account holder. The reference is basically required to safeguard the interest of the bank.

Submit bank account opening form and documents
You’ll be required to submit the Account Opening Form with the following documents*:

Photo identity proof – Permanent Account Number (PAN Card), Valid Indian Passport, Voter Identity Card, Aadhaar card
Address proof – Electricity bill, Bank statement, Aadhaar card, Valid Indian Passport, Voter Identity Card, or a rent agreement in your name.

*NOTE: If you want to open a current account for your business, the requirements may differ from bank to bank.

Officer will verify your Bank Account Opening Form
The bank officer will then verify the proposal form along with all the necessary documents. The form should be complete in all respects and you should have all the documents in both original and copy. Once the documents are fine, your form will probably be cleared.

Deposit initial amount in newly opened Bank Account
As soon as your form is cleared, you will be required to deposit the necessary amount in the bank (the amount may vary from bank to bank). After the initial money is deposited, the bank will probably provide you with the following things:

Savings Account: a pass book, cheque book and pay in slip book
Fixed Deposit Account: a fixed deposit receipt
Current Account: a cheque book and a pay in slip book
Recurring account: the pass book and a pay in slip book

Once your bank account is opened, most banks will make it very easy for you to manage it. You can also operate your account online through internet banking, on phone through mobile banking or by drawing cheques and filling withdrawal/deposit slips at the bank directly.

For your online business, Amazon will be handling all payments by depositing the fund to your bank account directly. If you want to get a loan to start your business, you can read about documents required to get a business loan. So, get an account opened today and set up your business on Amazon by registering here.
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