Published: November 28, 2019 | Posted by: Venus Zoleta | Personal Finance
Even though banking has gone digital these days, traditional financial products like checking accounts are still common in the Philippines. Some businesses and lending institutions even prefer payments in checks that serve as tangible proof of transaction.
For regular folks, the need for a checking account may not be as urgent as that of a savings account, except for borrowers who are required by lenders to issue post-dated checks.
Need to open a checking account? Here’s everything you need to know about checking accounts in the Philippines.
A checking account, also called current account, is a type of bank account that enables the holder to make over-the-counter deposits and withdraw funds through writing checks and/or using a card.
Aside from a checkbook, many checking accounts nowadays come with an ATM or debit card for withdrawals, point-of-sale (POS) transactions, and online payments. Some even include a passbook for transaction monitoring.
The ability to write checks is what defines a current account. But since account holders can also use a debit card, a checking account can be used for a wide range of financial transactions, including the following:
Checking accounts are highly liquid, meaning holders can easily access funds in their accounts.
Here are the various ways to access money in a current account:
Why is it important to have a checking account?
Besides being a requirement for loan amortization and insurance premium payments, checks are also a safer and more convenient way to pay with a large sum of money. You’d feel more secure bringing a check than cash when paying a six-digit amount, right?
A current account also lets you keep a record of your transactions, which you can easily track via the monthly statements mailed to you or using the online banking channel of the bank.
Checking accounts share some similarities with savings accounts, like the ability to deposit and withdraw funds. Deposits in both types of bank accounts are insured up to PHP 500,000 by the Philippine Deposit Insurance Corporation (PDIC).
On the other hand, checking accounts and savings accounts are different in many ways. The most obvious difference is that you can issue checks using a current account. Checking account opening is also more expensive, with their higher initial deposit and maintaining balance requirements than savings accounts.
Although both deposit accounts can earn interest, savings accounts typically have higher rates than current accounts. This is why the former is ideal for saving money, while the latter is better for making financial transactions.
Before you start looking for options, it’s important to know first the different types of checking accounts and which one fits your needs best.
Current accounts in the Philippines can be classified into five categories based on their features and purpose.
Entry-level current accounts are ideal for first-time depositors because of their low initial deposit and maintaining balance requirements of PHP 5,000 or less. These accounts don’t earn interest and don’t have a debit card (those some offer an optional card).
This type of checking account is for the personal use of individuals who need to issue checks for different payment purposes.
These commercial checking accounts suit the needs of small and medium enterprises, as well as corporations. Business checking accounts generally have higher minimum maintaining balances than personal checking accounts.
These bank accounts combine the features of a savings account and a checking account. All-in-one checking accounts come with a checkbook, ATM/debit card, and passbook. Typically, these are interest-earning accounts with a high initial deposit and maintaining balance.
All the checking account types above allow transactions in Philippine Peso. If you need to transact in USD, go for a US dollar checking account. Currently, only Citibank and PNB offer this type of current account in the Philippines.
You’ll find plenty of options for checking accounts in the Philippines. Although they seem pretty much the same, there are not-so-apparent differences that make some better suited for you than the rest.
The key to knowing the best checking account for you is to read the fine print and pay close attention to these crucial features:
Consider only checking accounts that you can afford to open and maintain. Otherwise, you might end up always falling below the required minimum balance and pay the corresponding penalty fee, which can deplete the funds in your checking account.
To give you a head-start, here are the minimum initial deposit and maintaining balance requirements of checking accounts in the Philippines.
Initial Deposit and Maintaining Balance
|RCBC Payroll Checking||Entry-level||PHP 1,000|
|UCPB CheckStarter||Entry-level||PHP 1,000|
|China Bank Savings Easi-Checking Basic||Entry-level||PHP 3,000|
|Bank of Commerce Checking||Personal||PHP 5,000|
|BDO Peso Checking||Personal||PHP 5,000|
|China Bank Savings CheckMate||All-in-one||PHP 5,000|
|China Bank Savings Easi-Checking||Personal||PHP 5,000|
|Citystate Regular Checking||Personal||PHP 5,000|
|DBP Current||Personal||PHP 5,000|
|EastWest Regular Checking||Personal||PHP 5,000|
|LandBank Regular Current||Personal||PHP 5,000|
|PNB Budget Checking||Personal||PHP 5,000|
|PSBank Regular Checking||Personal||PHP 5,000|
|Security Bank All Access Checking||All-in-one|
|UCPB Regular Checking||Personal||PHP 5,000|
|Bank of Commerce Checking||Business||PHP 10,000|
|BPI Regular Checking||Personal||PHP 10,000|
|BPI BizLink Checking||Business||PHP 10,000|
|BPI Business Checking||Business||PHP 10,000|
|DBP Current||Business||PHP 10,000|
|LandBank Peso EASY Check||Personal||PHP 10,000|
|LandBank Peso EASY Check with ATM Access||All-in-one||PHP 10,000|
|LandBank Regular Current||Business||PHP 10,000|
|Maybank Classic Checking||Personal||PHP 10,000|
|Metrobank Regular Checking||Personal||PHP 10,000|
|Metrobank Commercial Checking||Business||PHP 10,000|
|PNB Regular Checking||Personal||PHP 10,000|
|PSBank Regular Checking||Business||PHP 10,000|
|RCBC Regular Checking||Personal||PHP 10,000|
|BDO Smart Checking||All-in-one||PHP 15,000 (personal) / PHP 25,000 (business)|
|Citystate Regular Checking||Business||PHP 20,000|
|EastWest ChequeMax||Personal||PHP 20,000|
|EastWest Regular Checking||Business||PHP 20,000|
|LandBank Peso EASY Check||Business||PHP 20,000|
|Bank of Commerce Complete Checking||All-in-one||PHP 25,000 (personal) / PHP 50,000 (business)|
|BPI Maxi One||All-in-one||PHP 25,000|
|Metrobank Account One||All-in-one||PHP 25,000 (personal) / PHP 50,000 (business)|
|PNB Priority Checking||All-in-one||PHP 25,000|
|PSBank Premium Checking||All-in-one||PHP 25,000|
|RCBC Dragon Peso Checking||All-in-one||PHP 25,000|
|RCBC Super Value Checking||All-in-one||PHP 25,000|
|UCPB Multi-One||All-in-one||PHP 25,000|
|EastWest ChequeMax||Business||PHP 50,000|
|EastWest ChequeMax Rewards||Personal/Business||PHP 100,000|
|PNB Greencheck||US dollar||USD 2,000|
The bank may charge you several account maintenance and transaction fees that are deducted from your checking account balance. Find out and compare the following fees and charges when choosing a current account:
Most current accounts in the Philippines are used for transactional purposes only and thus don’t earn any interest. However, a few ones are interest-bearing accounts. These checking accounts have fixed interest rates ranging from 0.25% to 1.25% per annum for a minimum balance of PHP 10,000 to PHP 100,000.
Minimum Balance to Earn Interest
|PSBank Premium Checking||0.50% to 1.25%||PHP 25,000|
|BPI Maxi One||0.25% / 0.35%||PHP 25,000|
|BDO Smart Checking||0.25%||PHP 15,000 (personal) / PHP 25,000 (business)|
|China Bank Savings Easi-Checking||0.25%||PHP 10,000|
|China Bank Savings CheckMate||0.25%||PHP 20,000|
|Metrobank Account One||0.25%||PHP 50,000|
|RCBC Dragon Peso Checking||0.15% to 0.50%||PHP 25,000|
|RCBC Super Value Checking||0.15% to 0.224%||PHP 100,000|
|RCBC Regular (interest-bearing)||0.15%||PHP 25,000|
|EastWest ChequeMax||0.125%||PHP 20,000 (individual) / PHP 50,000 (corporate)|
|LandBank Peso EASY Check||0.10%||PHP 10,000 (individual) / PHP 20,000 (corporate)|
|LandBank Peso EASY Check with ATM Access||0.10%||PHP 10,000|
|PNB Priority Checking||0.10%||PHP 25,000|
|Security Bank All Access Checking||0.10%||PHP 100,000|
|Bank of Commerce Complete Checking||Varies||PHP 50,000|
Checking account opening is almost similar to opening a savings account in terms of requirements and procedures.
Here’s the key information you need to remember before you open a checking account.
Most banks require the following documents for opening a checking account:
Depending on the bank and the applicant, additional documents might be required, including the following:
A huge responsibility comes along with having a checking account. The last thing you’d want to happen is to discover you’ve issued a bounced check, and the receiving party is suing you for it. Or your check falls into the wrong hands, causing you to lose money in your checking account.
Remember these quick tips to maintain your checking account properly and avoid any financial disaster:
Even if you don’t need a checking account right now, it helps to know how it can help you meet your midterm to long-term financial goals. If you’re beginning to put your finances in order, having a checking account is a good step in the right direction.
Venus Zoleta is a personal finance writer who started investing and bought a home in her early 20s. This crazy cat mom works hard to feed her furbabies. She eats ramen like there’s no tomorrow. You can reach her on LinkedIn (bit.ly/2yFSlhE).