What is cash concentration?
Cash Concentration is a service offered by some banks to customers with multiple accounts where the surplus is taken from individual accounts and associated with one joint account. There are a number of reasons why consumers use this service, from the safety of employees in more branches to the desire to invest more efficiently. The customer has a high level of control over cash concentration and can customize the service to meet specific needs. When the balance goes through the limit, the bank automatically converts the excess to the cash concentration account. It is possible to maintain zero balances, in which case any deposits move an empty account and into the central account. Bank statements provide information about how much money is on each account and how much is available on a concentrated account.
One Reason for the use of this service is intended to make the company employees to make deposits at the nearby bank branch, which is safer and more comfortable. Rather than the need to manually convertThe company can have them moved in the cash concentration system. It can mark branches as zero balance, so it is possible to store money, but do not select any out, or could leave a small amount of money using each account as small cash of individual business branches, if necessary.
Another reason may be better organization of wealth. The company can keep enough money in each satellite account to meet accounts and obligations, and associate the rest into a central account to get a better idea of how much money it has to reduce investment or debt. This can also be used as a savings technology, to immediately pull any extra money out of your account with regular use. This can eliminate this eliminating and allow companies to supply funds for future use.
Banks with available cash concentrations candiscuss with customers. Financial advisors can be able to offer help to customers who are not sure how much money on each account. The bank may consider business needs, previous banking habits and the behavior of other customers to recommend a reasonable balance, and the cash concentration plan can also be programmed to return the money to prevent overdrafts.