A Joint Account can be of following types: In the case of (1) and (2) above operation in the account is likely to be stopped by the Bank on the death of any of the joint account holders and the balance amount in the account is sealed. Account Disable 12. In order to recover the loan amount along with interest the bank provides a repayment schedule to the borrowers which includes both repayment of Principal amount and Interest Amount. The eldest member of the family is known as ‘KARTA’. Pavan R (Assistant) 06 August 2012. Whether Bank account is Real account or it is Personal Account? The Hindu Law governs a Hindu undivided family, which is nothing but a compilation of Hindu practices, customs and traditions. (AM - Finance) A joint account is a banking account maintained by two or more people. In this condition the borrower do not receive the payment of the products sold by him instantly. Sometime a person is not enjoying any credit facility from the bank and is managing his business by his own funds. Cash Credit Limits are also of different types: Sometimes the borrower requires to sell its products on credit basis and product is supplied to the purchaser. While the general structure of financial statements Analysis of Financial Statements How to perform Analysis of Financial Statements. The bank takes due care in deciding the amount of loan in view of the maturity amount of securities held for sanction such loans so that as and when the security matures bank is able to recover both the principal as well as interest amount. Disclaimer 8. While using such limits bank allows withdrawals from the Cash Credit accounts for the purpose of only that business for which loan has been sanctioned and not for any other business. Here bank takes extra care to ascertain the geneouness of the bill. The bank provides immediate cash to the customer after deducting its discount and collects the proceeds of the cheque from the bank of the drawer of the cheque. Hindu coparceners include the sons, grandsons and great-grandsons of the holder of the joint family property. As is clear by name this type of loan account provides financial assistance for day to requirement of the business (business can be of any type like trading, manufacturing, self-employment, professional concern, any other concern, firm, Commercial, institutional, industrial etc.). As per Hindu Law the son conceived has the same right as a son born.   28 October 2020, Bank account is an artificial personal account, Triasha Gaur Loan is an act of lending (Money). This means the amount is deducted from the bank’s cash to pay the loan amount out to you. A HUF cannot be formed by a group of people who do not constitute a family, lineal descendents with a common ancestor is a must. the first named persons or his/her legal heirs are to take charge of the account as per bank rules. The bank also provides funds against such bills up to certain limit and and receives back the loan amount on realization of bills. Pavan R In such circumstances the account is treated as a claim case unless and until both the survivors and the legal representatives of the deceased party give a joint mandate to the bank for disposal of the amount held in a joint account. His eldest son will take his place. The right to manage the business and property of HUF vests with KARTA. Generally accepted accounting principles, or GAAP, specify the natural balance of accounts and tell companies whether a specific account should have a credit or debit balance. The karta has to be the oldest male in the family. The purpose is to ensure the end use of bank’s money so that it is used only for productive purposes and not for purposes which have no connection or utility for the business.   07 August 2012, ABBASALI GULAMHAIDER NANDOLIYA In case of progress in business and increase in the earnings or profit of borrowers this limit can be enhanced also and on the contrary if performance is found unsatisfactory the bank may reduce the limit also and on utterly bad performance such limits can be recalled also. If there is more than one individual who has access to the account, it is known as a joint account. This way he saves interest because bank charges interest on daily reducing balance and there borrower is charged interest for that number of days for which he had withdrawn the money.   In some cases, however, particularly where a husband -and-wife joint account is in question, the appropriation of the balance of the survivor on the death of one may depend upon the intention of the party who opened the account in the first place. These type of accounts are known as OVER DRAFT ACCOUNTS. All must sign on any relevant documents unless the mandate provides otherwise. You, as head of the bike company, should also record this. Terms of Service 7. Business banking is a range of services provided by a bank to a business or corporation.   28 October 2020, mira khan In case installment is not paid in time the amount of installment is treated as interest amount and the interest is also compounded accordingly. Before allowing such funds bank takes extra care to ascertain the authenticity of the bulk orders. So, the HUF for legal purposes compromise of all the major male and female co-parceners. Joint Accounts: A joint account is a banking account maintained by two or more people.