How Long To Keep Bank Statements (And Why)?

Exact Answer: 1 Year

A bank is a financial institute that is present in every country, every state, and every district. They accept all your deposits in the form of money creating demand deposits by the public and providing them different types of loans. Banks provide many types of loans like personal loans, housing loans, car loans, property loans, educational loans, and many other types of loans.

It plays a very important role in financial stability and the economy of the countries. There are several jurisdictions that exercise a high degree of regulations that are very strict on the banks which is important for proper functioning.

How Long To Keep Bank Statements?

Every country has different rules and regulations. They have institutionalized a system called fractionally reserved banking which states banks should have liquid assets which are only equal to a portion of their current liability.

The rules and regulations which are set by the countries laws are due to ensure the liquidity of the banks. In the countries, economic banks are very important to balance the economic growth of the country. The banking system all over the world has changed dynamically since the fourteenth century in every aspect like their way of working, security, liquidity, policies, terms, and conditions.

The bank is one of the primary sources of money for the middle class, and business class people. They provide loans to the people for many purposes like buying houses, buying cars, setting up a new business, and for any personal work like family functions. They are a far better option than personal lenders as they charge higher interest rates than the banks.

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Personal money lenders can sometimes take unfair steps to take their money back if you fail to pay them back on time, they just don’t follow any proper rules and regulations for the collection.

A bank statement is a statement provided by your banks on your expenditure from your bank accounts. These statements are important to be kept properly if you are planning to apply for a bank loan as they can help your loan provider to decide whether to lend you or not on the basis of your total income and your expenditure.

The lenders watch all your statements to find the efficient person who can pay the loan back on time at a decided interest rate. If you want a loan from the bank you have to keep bank statements for at least one year.

RecordsDuration
Bank Statement1 Year
Debt Deduction7 Years

Why To Keep Bank Statements For That long?

Banks are a good source of financial help but every coin has two faces in the same way if they provide us advantages they have many disadvantages also. There are many banks with plenty of schemes spread everywhere online offline. This upgrade in the banking system poses a risk of fraud in them. The frauds related to banks are maximum time so sophisticated that it is next to impossible for a middle class or a common person to think at a higher level to avoid frauds. It is like with increasing security the pattern of frauds in the banking field is also changing dynamically.

The most common way chose by the fraudsters is telephonic fraud where they can a person with his or her complete information like their number, name, address, bank name, branch, and account type. They start asking questions related to your accounts like your account number and other details which give them access to your accounts and they can just withdraw a huge amount from their accounts without their permission. To avoid this type of fraud one has to be very careful will sharing any information especially never share your OTP (One Time Password) with anyone as it is very confidential.

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Conclusion

Banking is the best option but it needs to be handle with precautions otherwise you may suffer a heavy loss. There are many fraud schemes related to loans that offer loans at a really low interest rate but can be very costly if you are trapped. In the process of taking loans, you have to be really very careful with all the documents of your agreements.

References

  1. https://link.springer.com/article/10.1057/imfsp.2008.31
  2. https://academic.oup.com/jeea/article-abstract/3/1/179/2280911
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