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“The bank is not as black as it is painted – how to read financial documents”

Bank accounts

Contents

A BANK ACCOUNT – this is one of the banking services. A bank account is maintained by a bank on the basis of a previously concluded agreement with its holder(s). A bank account holder may freely manage the funds accumulated on the bank account if the agreement does not contain provisions limiting this possibility.

There are 3 basic types of bank accounts:

  • a checking account,
  • a savings account,
  • a foreign currency account.

A CHECKING ACCOUNT – This is a standard account that is intended for everyday operation. If you have this type of account, then you are the owner of a debit card or check. So you can pay for purchases, make transfers or pay bills using non-cash money from this account. There is as much money on the account as will be paid into the account, there is no additional increase.

A SAVING ACCOUNT – It’s a great way to store your savings. This account combines the advantages of a deposit and a personal account. You can use interest rates similar to those for term deposits, but you remain free to use the money deposited there. You can usually make a free withdrawal once a month, without losing any accrued interest.

A FOREIGN CURRENCY ACCOUNT – This account is used to collect and manage cash in foreign currencies (currency deposits and withdrawals, currency transfers, receiving receivables from abroad). Depending on the offer of a given bank, it is possible for the customer to receive a currency card for his account.

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If you want to open a bank account, find the answers to the following questions:

  • Is there a monthly account maintenance fee? If so, what is it?

Look for a bank where you can avoid this fee. Sometimes there are accounts for a specific group of people where the fee is already 0 or there is a possibility to do so under the relevant conditions.

  • Does the bank specify the minimum balance to be maintained in the account and how much?

Also ask about the consequences of exceeding this limit.

  • If you want to open a savings account, ask what the interest rate is and choose the most advantageous one.
  • Has the bank set a limit on the number or method of transactions (deposits/withdrawals, using an ATM, etc.) that can be executed per month?
  • Which ATMs can you use without paying any commission fees and what is the fee for the commission?
  • Is it possible to insure an account under a Deposit Guarantee Scheme (DGS)?
  • Will you have access to e-banking or m-banking?

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How to open a bank account? – step by step

  1. Make sure that you meet the bank’s requirements and can open an account.

Usually most banks require 18 years of age (otherwise parents’; signature on the forms may be required). You must have a valid document proving your identity and you must reckon that you will have to give the bank basic information about yourself (e. g. address, date of birth, etc. ). Some countries require a social security number and a certain minimum amount of money to open an account. This may vary depending on the country, bank and account.

  1. Choose the best bank for you.

Contact the banks in your area and ask [questions], which are above, about the conditions for opening an account, fees, etc. Choose the most advantageous offer.

  1. Select [the account type] you wish to open.

Most people usually open a checking account first, and only then a savings account. But adjust your choice to your needs. Sometimes banks have special offers for specific clients with more favourable conditions.

  1. Go to a bank branch and ask them to open an account.

In some banks you can also open an account by phone or online, but opening your first account is best done in person at a bank branch. The advantage of this is that you can ask questions and get immediate answers. In addition, the process of opening an account is then faster, as you can complete all the formalities on site.

  1. Before finalizing your account, ask important questions. If you have any doubts or do not understand something, ask for an explanation.

Don’t be afraid to ask. This is the perfect time to make sure you understand everything and avoid hidden charges.

  1. Provide the information needed to create an account.

It is good to have the following documents with you:

  • a document proving your identity (preferably an identity card, passport or driving licence),
  • a document confirming your address: this can be a phone bill or other official document that shows your name and address,
  • banks in some countries require a social security number, a taxpayer ID or an employer ID. If you know this number by heart, you don’t need to have your social security card with you, etc.
  1. At the end of the whole process you will receive documents containing very narrow account information (PIN number, bank account number, social security number). Secure them well!

Don’t let people you don’t trust get access to these documents. If you notice that your account information has fallen into the wrong hands, please contact your bank as soon as possible to block your account funds.