Problems caused by having more than one bank account | Limiting the number of accounts to one or two is best

September 20th, 2010| In India.

Problems caused by having more than one bank account | Limiting the number of accounts to one or two is best

If a customer is having two or more bank accounts and there are no transactions in the bank accounts for a long time, and minimum balance is also not being maintained in the accounts, then the customer should cancel the accounts which are not required.  Otherwise the credit score of the customer may decrease.  There may be problem when obtaining a loan at a later stage.

Earlier opening bank account was a big issue.  Accounts were opened after submitting all the required forms only after 10 to 15 days.  But now banks are opening accounts within ten minutes and also offering many latest services.  So it is not a big thing that many are maintaining more than one account.  But new problems may arise if they are not properly maintained.

Having many accounts may lead to maintenance problems.  There would be confusion in matters like depositing and withdrawing from various accounts.  It is not easy to keep track of all the accounts if new accounts are opened one for paying house loan installment, one for credit card payments, one for insurance policy investments and one more for monthly house expenses etc.  Problems increase with the increase in the number of accounts.  For example, the money is not transferred to the account for paying monthly house loan installment; payment of loan in time is not possible.   And if the money is not transferred to the account for paying the credit card bill, then the bill has to be paid with penalty after due date.  If this happens recurrently, banks view the customer with a doubt.  These things will be noted in the loan history of the customer.  Then obtaining new loans will be a hard task.

Limiting the number of accounts

To avoid such situations, cancel the accounts which are not required.  Limit the number of accounts to two.  Let us see how to limit the accounts.

  • Salary account is the most important account than any other account.  Generally these accounts are opened by the Organizations for their employees.  Otherwise one can open their own account.  Along with salary deposit other profits and interests in this account.
  • Pay all the amounts like installments of house loans, premiums of insurance policies and investments from this account only.  Utilize ECS facility.  It is easier to maintain an account which is used for both deposits and payments.
  • Open an account specially for maintaining the house.  Open a joint account with the life partner for using the account to pay credit card, phone, cable, petrol, property bills etc.
  • Otherwise use salary account for all these expenses.  Open a new account for investments, insurance, car, house loan payments.  Transfer the money to this account from the salary account.
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