ZIMSEC O Level Commerce Notes: Money and Banking: Types of Bank Accounts
- Are used to keep the customer’s money safe.
- Are suitable for small saves with regular incomes.
- Have a low opening and minimum balance usually $0.
- Withdrawals are on demand.
- Cash can be obtained through the ATM or by filling out a withdrawal slip.
- Deposits are made by filling deposits slips.
- Customers are required to fill forms in order to open an account and to present identification documents as well.
- Keeps money not wanted for immediate use.
- Higher interest is paid on monies held in these account.
- Interest is dependant on the amounts deposited.
- Withdrawals require 7 days notice.
- No ledger fees are charged on these accounts.
Fixed Deposits Accounts
- There is a set minimum deposit amount.
- Deposit are held for a fixed period of 1 to 12 months.
- The customer is not expected to make a withdrawal until this period has lapsed.
- The interest payable on the deposit is fixed for the entire period under which the deposit is held.
- These accounts earn a higher interest rate.
- A customer adds up all his/her bills for the whole year.
- The total is then divided by 12 (months) to get the cost of bills for each month.
- At the end of every month one twelfth of the bill’s annual total is transferred from the customer’s current account to his budget account.
- Some banks issue special cheque books for budget accounts.
- The customer uses the budget account cheques to pay their monthly bills.
- Opened by both businesses and ordinary people.
- Allows customers to use cheques when making payments.
- Current account holders do not need to carry cash around.
- Account holders can make and receive stop orders, credit transfers or direct debits.
- Cheques may be used as receipts for payments made.
- Account holders have access to overdraft facilities.
- Interest is received on credit balances.
- Banks send statements on a regular basis to account holders.
- Bak offers trade references to account holders.
- Account holders are provided with night safe facilities
To access more topics go to the Commerce Notes page.