|A current account is a service rendered by financial institutions which allows bank customers - both individuals and businesses - to deposit money and withdraw funds from an account at any time. Different banks use different terms for a current account, but in general current account holders can pay debts by means of personal checks in place of cash. Cash machine cards and debit cards can also be used to access an account or make cash withdrawals.
Most banks provide some form of current account service. Some may require an initial credit before establishing a new account. A student or other low-income applicant may opt for a no-frills current account where personal cheques and other services are available free of charge. Other customers may derive benefit from interest payments, provided that they maintain a high minimum balance monthly.
Holders of current accounts are responsible for keeping track of their balance, although the bank will regularly issue its own accounting statements. Cheques must represent an actual amount of money contained in the current account itself. If a cheque is written for a sum higher than the available funds, the cheque writer faces countless fees and possible legal litigate. The recipient of the 'bad' cheque can demand prompt cash payment for the original debt as well as a substantial fee for the returned cheque. Some banks will shield holder of current accounts by making the appropriate payments and informing the cheque writer that an overdraft has taken place. Frequently the financial institution will recuperate their losses through substantial service charges, so it pays to avoid writing cheques when the balance is unknown.
Most banks have several different methods which enable current account holders to check their balances and reconcile their records. Printed monthly statements of debits and deposits are sent to current account holders. Cash machines provide an option to check the balance, while online or phone-in accounts can provide real time updates on which cheques have been processed and which are still outstanding.
For further information on current accounts, please visit www.checkingaccount.ca.