Optimizing Employee Salary Transfers: Bank Account Setup and Process Guidelines

Hi,

If I transfer the salary to my employee from my savings bank account, will that be considered as a salary transfer when the employee applies for a loan or credit card in India? I believe that in the narration, it should state "salary" in order for it to be recognized as such by the bank verification team. Additionally, it will display my personal name rather than my company name in the employee's bank passbook. Is it possible to transfer the salary from my personal savings bank account to employees in a way that reflects as "salary" in the narration? Or should I consider opening an account for my company in Bangalore, India? Since we have fewer than 10 employees and our salary payout is below 1 lakh, which bank would be willing to accommodate us considering our small transaction amounts? I understand that most private banks usually require a minimum of 25 employees and at least 5 lakh in monthly transactions. Any assistance provided would be greatly appreciated.

Thank you.

Hello Lokesh,

You would need to open a current account in your company's name with a bank first. As far as I know, the banks may need your company certificate and PAN card. I don't know if the requirements have changed now.

Why don't you check it out with local private banks?

Good luck,
A.B.

Hi Lokesh,

Mail18 has rightly replied. You must transfer the salary through the company's current account. If you have opened a registered company, then you'll have to show all this information while filing service tax.