A checking account or a current account is a type of transactional account that permits deposits and withdrawals to be made. Checking Accounts are available with almost all banks in the Philippines and are used for both personal and commercial purposes.
Advantages of Checking Accounts
Check Payments – One of the biggest advantages of a checking account is the facility to make payments in checks which could also serve as proof of your payment.
Other Forms of Payments – You will usually also get to transact through online transfers, through phone banking, through ATMs and through POS, depending on whether you get an ATM or a debit card.
PDIC Protection – Checking accounts are eligible for PDIC protection up to a maximum of P500,000 for each depositor.
Easy Withdrawals – Current Accounts place no or low restrictions on withdrawal of funds.
Overdraft – Some checking account products also allow account holders overdraft, a facility that allows them to withdraw more than what they have on deposit, up to a set credit limit. This can come in very handy especially when emergency cash is required.
A Few Popular Checking Account Products
▪ The Budget Checking Account from the Philippine National Bank is a non-interest earning account that has a limited check issuance feature, a low maintaining balance, permits deposits and withdrawals at all PNB branches nationwide and is excellent if you have a limited need for issuing checks but want to free up your funds for other high yielding investment avenues.
▪ The EastWest Basic Checking Account requires an initial deposit and a maintenance balance of only P1,000, comes with a Visa debit card and allows you to access funds via checks, ATMs, POS and through online banking. Over the counter funds transfers involve a transaction fee of P100.
▪ Citibank offers a bouquet of checking account products and services that include:
The Citibank Peso Everyday Banking Account that allows you to make free withdrawals from any ATM in the Philippines and over 20,000 Citibank ATMs worldwide
The Citibank Dollar Everyday Banking Account that enables you to withdraw in U.S. Dollars from any Citibank ATM in the Philippines, or inquire about your balance, at over 900,000 ATMs worldwide, and
Citibank Check Protect, a check funding facility that protects your checks from the risk of being returned for having insufficient funds. This is a great feature to have considering that you could get heavily penalized or even sent to jail under Batas Pambansa Bilang 22 for issuing insufficiently funded checks.
▪ The BPI Direct Maxi-One Checking Account from BPI Direct Savings Bank combines the features of a savings, an ATM and a checking account. You can enjoy interest on your funds, enjoy an ATM withdrawal limit of P50,000 a day and even open an account online. You will get an interest rate of 0.5% per annum but you will need an initial deposit, a monthly minimum average daily balance and an end of day balance of P25,000.
Tips on Selecting a Checking Account
Here are a few tips on what you need to look out for before you select a Checking Account product:
Why do you need a Checking Account?
Determine why you would need a checking account. Do you need to make regular payments by check? Do you have to make a high number of deposits and withdrawals? Checking accounts have a number of fees, charges, deposit, Checking accounts Interest rates and balance requirements associated with them. Go in for one only when you can justify the associated costs.
Which product do I go in for?
As you can see from the above section, there are a wide variety of products. Make sure you understand the features and the pros and cons of a product vis-a-vis your requirements before you decide to go for it.
What do I need to look out for?
Look carefully at the features offered and make simple pen-and-paper feature comparison of products. Also look at all associated charges, conditions, regulations and penalties before you decide upon a particular product.