M8 Opening a bank account

Micro EnterpriseFinancial Management

Once any group begins to save money, it is important to open a bank account so that the money is kept safe from theft or loss. Two people need to sign each cheque as well as the Treasurer. These people must be able to write their names and must be trustworthy.

  • A bank needs to be sympathetic to the aims of the group and willing to let them open a joint account. If a group has kept good records, these may help reassure officials of the reliability of the group.
  • New groups may find it helpful to get advice from someone who already has a bank account, or from an NGO. These people may be needed to give a guarantee to the bank. Can people suggest such individuals?
  • It is useful if the bank is nearby so that deposits can be made regularly. Find out about bank charges before opening an account. If there is a choice, find out about the different rates of interest available and choose an account that gives higher interest as long as payments and withdrawals can be made regularly.
  • If inflation is very high, there may be little point in saving money in a bank account as it will just lose its value. In what other ways could groups invest their money? For example, could they purchase building materials or kitchen equipment that could be resold?