Often times, business owners are confused about maintaining a separate account for their business be it a current account or savings account. Currently, in Nigeria, there are two common types of bank accounts – a savings account and a current account. While it is not ideal to use a savings account for your business, you make better decisions when you are informed. Both accounts have their benefits and are distinct. With this article, you will have a better understanding of these two types of account so you can make better decisions.

Current Accounts

Current bank accounts are very common among companies, firms, public enterprises,  and businessmen. It is generally for people who usually have a higher number of regular transactions with the bank. The current account allows for deposits, withdrawals, and contra transactions. A Current account can be opened in most commercial banks. Usually do not carry a limit on the number of transactions that can be made, and also do not earn interest. Current accounts;

1. Allow handling of large volumes of receipts and/or payments systematically.
2. Derive their name from the purpose they are suited for, regular transactions.
3. Is more suited for users like firms, companies, businessmen, public enterprises, etc.
4. Do not earn any interest due to the fluidity they offer.
5. Do not carry a limit on the number of transactions which can be made.

Also Read: 10 Practical Ways to Avoid Unnecessary Bank Charges In Your Business Account

Savings Accounts

A savings account is a basic account that allows you to deposit money, keep it safe, and withdraw funds, all while earning interest. It is designed to encourage and promote savings. Suitable for individuals who earn a regular income and also for people who have a short term financial goal(s). Savings account;

1. Designed with the primary purpose to help you save.
2. Allows the holder to deposit money as is convenient, on which the holder can earn interest.
3. May be opened by an individual or jointly. And it requires the holder to usually maintain a pre-specified amount as a minimum balance.
4. Earns interest that ranges anywhere between 4% to 6%.
5. Usually do not carry the facility of issuing cheques.

Current Account or Savings Account

Current accounts are great for managing your business expenses and paying bills. They also come with a range of perks like access to ATMs, debit cards and cash points that help you save money when it comes to everyday purchases. But if you’re looking for an alternative investment option that offers higher returns than current accounts, then a savings account may be right for you!

Also read: What do I need to open an account with Lenco

Which Bank Account Should I Get? – Lenco.

Now that you can compare both options, you should know that it is ideal for a business to have a business account. While current accounts traditionally come with charges and account maintenance fees, Lenco offers a business bank account that is free of hidden charges. With Lenco, you experience ease with opening and operating your business account.

Lenco Bank is a Fintech created to solve the banking challenges faced by businesses in Nigeria. Offering tech-based affordable banking solutions to business owners. With Lenco, you are able to run a business account with minimal cost in order to successfully grow your business. You get all the banking services at your fingertips. You are also provided with your ATM Card and you can perform transactions on our online platforms.

Lenco business account is basically free.