Describe the procedure to be followed to open a bank account.

The procedure for opening a bank account consists of the following steps:

1. Application in the Prescribed Form — The person or organisation wanting to open a bank account has to apply to the bank in the prescribed form. The form is available free of charge. Different forms are used for different types of accounts (savings, current, etc.). The application contains the name, occupation, full address and specimen signatures of the applicant.

2. Introduction of the Applicant — Opening a bank account creates a business relationship; the bank undertakes to honour the cheques drawn by the customer so long as there is credit balance. To reduce risk and fraud, the bank insists that the applicant be introduced by an existing account holder or a reputed businessman. The introducer signs on the application form and writes his full address.

3. Specimen Signatures — Once introduction and references are satisfactory, the applicant is asked to give two or three specimen signatures on a prescribed card. These are filed alphabetically and used by the bank to verify signatures on cheques. If the signatures do not match, the bank can refuse payment.

• For a partnership firm: a copy of the partnership deed must be submitted.
• For a joint stock company: certified copies of the Board resolution, Memorandum of Association, Articles of Association, Certificate of Incorporation, Certificate of Commencement of Business (for public companies), and specimen signatures of authorised persons must be submitted.
• For a cooperative society or club: copies of certificate of registration, list of managing committee, bye-laws, and specimen signatures of authorised persons.

4. Photographs — Banks now require photographs of applicants to prevent fraud. The photographs are affixed on the signature cards, helping to verify the customer's identity later.

5. Initial Deposit — When all formalities are completed, the applicant deposits the initial amount. The bank opens an account in the applicant's name. The minimum deposit varies between savings and current accounts and from one bank to another.

After opening the account, the bank provides a pass book, cheque book and pay-in-slip book to the account holder.