Small businesses should always have checking accounts in addition
to any regular bank accounts. Checking accounts can be used for accepting
money from different income sources and can be used for paying expenses
using checks. A check is an official document from the bank that authorizes
payment from your bank account.
Opening one of these accounts is essential to small businesses because
they can save you thousands of dollars annually. The benefit of opening
a checking account is that it pays the account holder’s bills
on time and helps them obtain credit.
Carrying checks is safer than carrying cash. If you happen to lose
your check book or it gets stolen, you can report it to the bank,
have the check numbers cancelled and have a new check book issued
without the loss of any actual funds.
An additional benefit is that there is always proof that you have
paid your bills. You can be issued an ATM/debit card. The ATM (automated
teller machine) cards allow the customer the facility of removing
cash from a machine that is connected to the bank’s the central
computer. The service is available twenty-four hours a day and is
very convenient. The ATM card acts as a debit card that can be used
for shopping. The cashier will swipe the card as though it was a credit
card and payment is taken directly from the account after verification
from the central link exchange.
Individual banks impose a variety of charges for checking accounts.
It is worthwhile to shop around for information on the banks in your
area. Most banks will not charge any fee for opening the account,
but will charge for bouncing checks or if the balance is below the
required amount of funds.
It is convenient to open an account with a bank located near your
business and the safest to choose from are Credit Unions. Credit
Unions offer a higher rate of interests than most banks, but it
can be difficult to join a Credit Union because they may only offer
services to specified communities and members. Most other banks
will welcome your business without hassle.
The best way to manage your checking account is by keeping deposit
and payment/withdrawal records. You should keep a check register
to help you in keeping a track of the balance in your account. The
register acts as a diary for your checking account, keeping records
of the flow of money in your account.
At the end of each month you will receive a monthly statement,
which can be checked against your check register to be sure the
figures match.
