Amidst the daily tasks of business owners, managing business transactions is undoubtedly one of the most critical tasks. Corporate accounts help in this task regardless of the company size. Take a tour of the details of a corporate account with this article. 

What Are Corporate Accounts?

Corporate accounts are the bank accounts in the name of a business. Company account is another name for these accounts and these accounts make finance management more convenient for business owners. A corporate account holder enjoys the following:

1. Online banking and phone banking
2. Easy remittance
3. Credit and debit cards
4. Insurance
5. Mutual fund
6. ATM withdrawals
7. International transactions
8. Lockers
9. Easy deposits

Purpose of A Corporate Account

Corporate accounts assist business owners in

• Facilitating transactions
• Receiving business payments
• Filing tax
• Credits
• Managing business loans

How Does A Corporate Account Work?

Corporate accounts have the same workflow as regular bank accounts. Business owners can store their income in these accounts and withdraw it whenever needed with cards, cheques, etc. These accounts also provide additional facilities, such as loans, tax filing, etc., to benefit the business.

How To Open Corporate Accounts?

Once you have determined the bank, you can visit the branch and thereby fill the necessary forms. Then, you have to submit the form with a copy of the required documents—the bank will inform you of the next steps.

Also, opening a corporate account online is possible—check the bank's website for this.

For more clarity, it is always advisable to visit the branch, speak with the authorized person, and then open the account.

Eligibility Criteria - Who Can Open And Operate Corporate Accounts?

Any business entity with a board of directors can open and operate corporate accounts – here are a few examples:

• Sole proprietorships
• Partnerships
• Limited liability companies
• Private limited companies
• Public limited companies
• One-person companies (OPC)

Companies must have a board of directors and their approval (where applicable) to open corporate accounts. But, the smaller companies that do not have a board of directors do not need approval.

What Documents Are Needed To Open Corporate Accounts?

To open corporate accounts, the following documents are needed:

1. Address proofs of principal shareholders or beneficial owners
2. Article of Association
3. Board Resolution
4. Business address
5. Business proof (statements, B-plan, etc.)
6. Certificate of Incorporation
7. Filled application form
8. Identity proof
9. List of authorized signatories
10. Memorandum of Association

Remember: The process of opening corporate accounts, eligibility criteria, and document requirements may vary slightly between banks, so it is highly recommended that you check with the bank first.

Factors You Need to Consider When Opening A Corporate Account

At the time of opening a corporate account, make sure you check:

1. Payable amounts with complete clarity
2. Security of the deposits
3. Introductory offers
4. Features and benefits
5. Terms and conditions

Also, read Current account

Cost Of Opening A Corporate Account

Application charges to open corporate accounts vary from bank to bank – so check with the banks.

Advantages And Benefits Of Corporate Accounts

Are you wondering, "Why is it so essential for businesses to have a corporate account?" These advantages and benefits of corporate accounts may convince you:

1. Provides a financial identity to the firm/business by separating it from the owner's account
2. Detaches the assets and funds from the owner/s and passes these to the company as a whole so that the business owner remains free from the liabilities for debts
3. Frees the business owners from accountability in case of profit or loss or incurred debt, as well
4. Brings an additional level of security to business finances
5. Creates a more professional image for the business/firm among investors, vendors, customers, etc., and welcomes further investment opportunities
6. Brings further clarity to future business pitches and helps in business expansion and sale
7. Empowers the business with filing easy tax returns
8. Relieves the business owners from the restrictions of direct debits of personal account
9. Helps in improving credit score without relying on credit rating for a loan
10. Assists in getting loans in easier terms
11. Secures bank's promotional offers, higher interest rates, free/low charges on digital transactions, etc.
12. Simplifies expenditure management and settlements with detailed reports and analytics

There is no hard and fast rule about whether businesses must hold a corporate account, but it is much needed for any business for these reasons mentioned above.

Also, check Escrow Account

Disadvantages Of Corporate Accounts

Some corporate accounts (not applicable to all) may require the account holder to pay higher transaction fees, which is nonetheless a disadvantage. The documentation policy also may sometimes appear confusing to users.

However, not all users face these problems—the majority of banks charge very leniently for transactions, and documentation policies are also very transparent. So, it will not be a problem every time.

Also, check Nodal Account

Corporate Accounts Vs. Business Accounts – Are They Same Or Different?

"Corporate account" and "business account" are often used interchangeably - but these are not the same; the following table shows the differences:

	Business Account	Corporate Account
Company size	Small companies	Mid to large-size companies
Eligibility	Individuals	Board of directors
Operated by	Business owner	Authorised signatories
Considered as	Personal asset of the business owner	Impersonal asset of the business owner/s
Process	Easy	Complex in comparison to business accounts
Benefits	Varies from bank to bank	Lower transaction charges, higher interest rates, etc.

Corporate Accounts Vs. Personal Accounts – What Are The Differences?

Now, let's move on to the differences between corporate accounts and personal accounts:

	Personal accounts	Corporate accounts
Signatories	One (individual bank accounts) Two (joint accounts)	Several - As many authorised signatories, the company adds
Account management charges	Low	Higher than personal accounts
Purpose	Maintaining personal finance	Maintaining business finance
Liability protection	No	Yes

Tips To Manage Your Corporate Account Like A Pro

Here are some pro-tips so that you can manage your corporate account without any trouble:

1. Have a well-defined investment strategy
2. Let a trustworthy person manage the account
3. Check all the schemes with expert eyes and pick the best one
4. Go through all the features the account is offering
5. Read the regulations thoroughly

End Words

So, a corporate account assists in managing business transactions more flexibly and conveniently. Besides, it offers tight security to deposits and helps to obtain a loan more quickly. Yes, the documentation may seem complicated, but these documents are readily available to business owners. So, get a financial identity for your business today and provide another layer of security to your business payments with a Pay payment gateway,. You can start your journey to payment gateway with PayG for the fastest, safest, and easiest payment collections.