Question

State two advantages of a bank account.

Write any three/five advantages of bank account.

State two advantages of opening a bank account.

Mention two advantages of a bank account.

Answer 1

The advantages of a bank account are as follows:

1. Secured deposits: Bank accounts are a safe and secure place to deposit money for the short and long term, and customers can withdraw their funds at any time.
2. Safe transaction: A consumer can transfer money from one place to another using the bank in a straightforward, easy, and secure manner.
3. Collection Facility: The bank collects cheques, drafts, bills of exchange, etc., deposited by the account holder. Businessmen with bank accounts can get their bills of exchange discounted easily.
4. Habit of Savings: Bank accounts promote the habit of thrift and saving in the public. People are prompted to save and deposit money in bank accounts due to the benefits of safety and earning interest.
5. Loans and Advances: Account holders can obtain loans, overdrafts, and cash credits from banks.
6. Safe Custody of Valuables: Banks offer lockers to their account holders on a preferential basis. Customers can deposit their jewellery and other valuables in lockers for safe custody.
7. Credit Information: Banks provide information relating to creditworthiness of their customers. A bank account holder can get better credit facilities in business. Banks also issue letters of credit on behalf of their customers who are engaged in foreign trade.
8. Other Services: A person can avail of various services by opening a bank account. Purchase and sale of securities, payment of insurance premiums, collection of interest and rent, remittance facilities, and travellers' cheques are these services offered by banks to account holders.