Banks, in recent years and because of competition have developed a lot of hybrid products that are targeted at various customers ‘needs. These products have varying conditions and cross functionalities of the generic banking products that may need explanation for customers to have proper understanding of the benefits they offer.
It is pertinent to ask your bank a few questions before you sign of for any of the banking product on display and not rely on your knowledge of the generic banking products as a guide to choosing what product to buy into.
Below is a list of banking questions you need to ask your bank before signing up for a new banking product
Does the account require minimum balance?
A good number of banks hybrid liability generating products requires that the customer signing up for them meet up with some conditionalities to enjoy the benefits. Such accounts have cross functionality between the generic savings and current account types. A savings account product with cheque book may require you to leave some amount permanently in your account while a current account that pay interest may also require that certain amount be maintained to enjoy the interest payable on such account.
Do I have to pay for cheque book?
One of the banking questions to ask your bank is whether your new account will be required to pay for cheque book or not. Some of hybrid account may give you the first cheque book for free and subsequent cheque book will be paid for. While some may allow you free cheque book once you are able to meet up with some other conditions on the account some of such condition may also be minimum balance.
Is online or mobile banking available for this category of account?
Almost all bank accounts can be profiled for online banking, but recently with Central Bank of Nigeria (CBN) tiered Know Your Customer (KYC) that allowed some bank customer minimum KYC documentations, banks may restrict accounts in these categories access to online and mobile banking because of lowered KYC condition.
Is ATM card free for this kind of account?
Another of the banking questions to ask your bank before going ahead with a new relationship is whether the new account allows you get ATM card for free. Competition and need to retain and acquire more customer are making banks to allow some of the paid services for free, so your new account may be one of those that allows free ATM cards
Does the account allow me to us ATM for free?
The current regulations allow all bank customer to use their bank ATMs for free but allows charges on other bank ATMs. So, inquire from your bank before signing up for any new product if you will be allowed to use other bank’s ATM for free. Your new product may have this extra free service without you knowing it.
Is transfer charges free on the account?
One of the fees that banks charge their customers is transfer fees while making transfers from their bank account to another bank. Asking your bank if there is going to be transfer fee on your account is one of the important questions you will need to ask in other to have a clear understanding of the kind of relationship you about to sign up for.
Can I earn interest on the balance on the account?
It used to be that only Savings, Call and Term Deposit accounts that enjoys interest, but competition is currently making banks pay interest on current account balances. Banks are also using interest rate a bait to attract customers. So be mindful of your ability to earn interest on your account and negotiate with your bank/s for higher interest.
Am I going to be charged monthly or any other fee the account?
Account Maintenance Fee and ATM Card Maintenance Fee are some of the other Fees that banks charge monthly. Make this one of the banking questions you will ask your bank before you commit yourself to a new banking relationship. You may be lucky to enjoys these services for free as competition and need to retain customer makes bank to develop new products
Does the bank allow overdraft on the account?
Generally, overdrafts are allowed on generic Current Accounts only if you have signed up for one. Otherwise the bank may not honour your cheque or payment if you have not signed up for overdraft service. So, if you are signing up for a new relationship with a bank please note to ask if you can overdraw your new account. Also let your bank explain to you in details what fees are payable for such overdraft as fees may be a little higher than normal for unauthorized overdrafts.
Is there any other covenant attached to the account?
Turnover covenants, maximum number cheques to be issued in a month, maximum number of withdrawals in a month, minimum balance to be maintained on the account are some of the other banking questions to ask your bank before you sign up for a hybrid account. Be sure to have a clear understanding of these covenants before you commit yourself to the new account as fees may be charged for deviation from them
What extent of cheque usage is allowed on the account?
Both generic savings and current account allows cheque lodgement into the account, regulation allows cheques with maximum value of N2 Million per day into savings account. But hybrid account comes with cross functionalities, some allows unlimited cheques lodgement into savings account while other savings account may not allow cheques, others allow you to issue your cheque to customers of other banks while some will only allow the cheque payable at their bank.