A corporate bank account is essential for a business organization. You need it to function as a legal entity. Also, it creates credibility with your clients and customers. That is why one of the steps to take after incorporating your company is to open a corporate bank account for your company. You place your company’s liability status at risk when you operate a registered business with a personal account. A corporate bank account signifies that your business operates as a different entity. A corporate lawyer or attorney can handle the entire process of incorporation for you. But if you wish to save cost and handle the process yourself, then this post will serve as an essential guide.
Thankfully, the process involved is less complicated; and your bank will be more than happy to guide you through. First, there are some documents you need to commence the process of opening a corporate bank account.
Documents You Need To Open A Corporate Current Bank Account:
1. A Business Resolution:
The first step to take when you want to commence the process is to draft a business resolution. Most banks will request for your company’s business resolution to operate a corporate account. A company’s business resolution is a document that contains persons who are authorized by the company to open the account. It is proof to the bank that the persons identified in the document are authorized to operate the account. Also, note that the document should state explicitly, those who are entitled to the affairs of the account. You’ve seen that a business resolution is essential to protect your company’s finances further. Your corporate lawyer can handle the process of drafting a business resolution for your business.
2. Photo Identification:
All the persons Mentioned in the business resolution need some identification. If there is more than one person, then they will be signatories to the account. Thus, they need to provide a means of identification. The bank can request for a unique means of identification. But in most cases, it should be photo identification or a government-issued identification card. You can make use of a driver’s license, an international passport or a voter’s ID card. This photo identification process is in line with the Patriot Act, which came into existence in October 2001. That is, after the World Trade Center incident. It made it mandatory for all persons opening a personal or business bank account to provide proof of identity.
3. Incorporation Certificate:
You are about to open an account for a corporate entity. Thus, the bank will require proof that the company you are fronting is duly registered and incorporated as a legal entity. Once you complete the process of business incorporation, you get issued a certificate of incorporation. You need to take this document along with you to the bank.
4. Employer Identification Number:
The Internal Revenue Service is in charge of issuing an Employer’s Identification Number (EIN) to corporations. The EIN is a nine-figure digit which companies use for tax payment/verification and bank related issues. Most banks make the EIN a mandatory requirement for opening a corporate account. It is similar to a Social Security Number which is compulsory to open a personal bank account. Note that you don’t necessarily have to be a corporation to get issues an EIN.
6. The Company’s Article of Incorporation:
Some banks do not request for a company’s Article of Incorporation. But it is necessary to have it handy just in case. Your Company’s Articles of Incorporation is the document that contains vital details such as the number of authorized shares. It also provides details of the company’s address. It also serves as a proof that a company is a legal entity.
7. Get Your Corporate Seal:
Another vital item which most banks will request for before opening a corporate account is a corporate seal. A corporate seal is merely the metal stamp that contains vital details of the company or business. It includes details like your date of incorporation, the business name and, the state the business was registered. Some banks do use the corporate seal as a signature for a company’s bank papers. You also use your corporate seal to affix the company’s signature in other legal documents. Surprisingly, even in this electronic and digital age, corporate seals are still used.
How To Open a Corporate Bank Account
With these documents in place, the next step is for you to visit the bank and visit the customer care desk. Some banks do allow you to open a corporate current bank account online and upload the required document for them. You may need to visit the bank for a physical identification exercise. so I will advise you to go to the bank for this.
You will get a form to fill. Enter your company’s details correctly. The signatories should fill up their columns and sign before they return the forms. Submit the other documents you have for identification and pay in your opening balance. You will get a bank account number and a checkbook for your business.
Viola, your company, now has a corporate bank account.