Explain six reasons why a businessman would choose to operate a current account instead of a savings account.

Why a businessman would choose to operate a current account

  • Excellent means of settlement of accounts speedily and economically avoiding the use of the legal tender
  • Can be used for direct receipt of, regular, sums by direct credit instead of legal tender
  • Withdrawals can be effected on demand without notice
  • It is a basis for obtaining loan funds or of overdraft facilities
  • Provide means to effect regular payment at stated intervals of time by standing order eg rent.
  • Safety, reliability and ready availability of funds kept in this way.
  • Provides periodic bank statements issued which schedule all bank transactions completed for the period.



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