Are you planning to open a bank account with someone else, or do you already have a joint account? There is critical information you should know, as highlighted by Banco de Portugal (BdP).
“Some accounts can be operated by the holders without needing authorization from all. Others require all holders to agree on transactions. Understand the differences and choose the type of account suitable for your needs,” advises BdP.
The financial supervisor outlines five important points to consider:
1. Solidarity accounts, joint accounts, and mixed accounts: The difference lies in who can access the funds
“Deposit accounts with two or more holders are termed ‘collective accounts’.
Some collective accounts can be accessed by any of the holders without needing others’ permission — these are known as ‘solidarity accounts’. A holder of a solidarity account can, for example, withdraw or transfer part or all the deposited funds without the consent of the other holders.
There are also collective accounts that require the signatures of all holders to operate — these are ‘joint accounts’.
Bank customers may also choose to open ‘mixed accounts’. The operation method for these accounts is agreed upon beforehand between the holders and the credit institution. For instance, account holders might agree with the credit institution that funds can be moved with the signature of a specified holder or with the signatures of any two others.”
2. You can open a reduced-fee account — the so-called ‘basic bank service account’ — with another holder, as long as certain conditions are met.
“The basic bank service account is a current account that allows holder(s) access to a set of essential banking services at a reduced cost.
Generally, a basic bank service account can have multiple holders, provided none have another current deposit account. However, a person who has other current deposit accounts may co-own a basic bank service account if the other person does not have any other deposit accounts, and:
- Is over 65 years old;
- Or is dependent on others (with a permanent disability degree equal to or greater than 60%).
- Regarding operation, basic bank service accounts can be solidarity, joint, or mixed accounts (see point #1).
3. The initially contracted operational conditions can, in principle, be modified at the request of the account holders.
“Changes to the operational conditions depend on the agreement between the account holders and the credit institution and may incur costs. Inquire with the institution.”
4. It is possible to remove or add holders to the account, but this also requires the agreement of all holders and the credit institution.
“To remove a holder from a collective account, the express agreement of all account holders is necessary, including the holder who wishes to be removed.
To add a holder to a collective account, the agreement of all account holders is equally required.
Changing account holders may have associated costs.”
5. Account holders can request account closure at any time and without cost.
“The account must be formally closed with the credit institution by all account holders. This request can be made at any time, but the credit institution may require prior notice if expressly stated in the contract. The notice period cannot exceed one month.
If the holders are consumers or micro-enterprises, the credit institution cannot charge fees for closure.”
