Chapter 11: Payment Account Flashcards
Balance directly available
Money in a payment account can be spent immediately
Due to this, Bank does not pay high interest or any interest on this
Third party access
Account holder has control of the account
Controls who else has access or who can diposit
Debit balance
Bank only carries out payment if there is enough balance
Can arrange an overdraft agreement for a fee
Opening a payment account
General procedure:
1. Inventory
2. ID and verification
3. Customer profile
4. Register name
5. Current account agreement
6. Banking conditions
7. Product conditions
Inventory procedure
Identify needs of the customer:
* Joint account or individual
* People with power of attorney
* Credit facility need
* Payment account options e.g. bank statements
* Are you switching from another bank
ID and verification
Bank must ask for proof of identity (money laundering and terrorist financing prevention act)
* Dutch id (passport or ID card)
* Verfiy identity matches e.g. documents/physical features/signature
* Check with the VSI system for stolen identities
Secondary identification
When another bank carries out verification
Customer profile / risk profile
Bank checks for risks to the bank e.g. money laundering
Bank creates a risk profile using registration systems:
* internal profile of previous incidents
* external reference application (fraud activity database)
* Bureau for Credit Registration
Registered name on the account
Only a single name on the account
* If person is unable to take care of account (e.g. illness) then power of attorney can be given for management only (e.g. make payments)
* Death of account holder = frozen account and “heirs of” will be added
Current account agreement
After previous procedures, agreement is signed = legal relationship
General Banking Conditions
The banking conditions (ABV) are issued to the customer
* obligation of due care (customer interests)
* Customer / representatives must provide signature upon request
* Complaints procedure
* written notice from either party to close account
Product conditions
Product conditions apply to certain products and services
e.g. Loan or savings account will have additional conditions to supplement ABV
Opening savings account
similar to payment account
Main difference = customer must nominate an existing payment account to act as the “contra account” for transfers