Difference Between Tier 1, Tier 2 And Tier 3 Account (What is Tier 1, Tier 2 and Tier 3 account?)

Read all about what is tier 1, tier 2 and tier 3 account.

Most Nigerian bank uses the three-tier banking system as a series of level to structure and place limitation on customer account. Each tier account has its own requirements, benefits, and limitations. However, tier 3 is the highest account structure which comes with a lot of benefits but it requires more verification and documentation while tier 1 is the basic account which comes with a lot of restrictions but is easy to access.

In the Nigerian banking system, a tier 1 account is commonly known as an instant account or student account. with just your basic personal information, you can create a tier 1 account with any Nigerian bank and fintech companies like OPay, PalmPay, and many more. However, you can upgrade to a Tier 2 or Tier 3 account by providing the necessary documents.

A savings account is often known as a tier 2 account in the Nigeria banking system but you can also upgrade your account further to access more features. If you want to know the difference between tier 1, tier 2, and tier 3 accounts, then you are in the right post. Let’s get started….

Read all about Gtbank tier 1, tier 2 and tier 3 account limit

What is a Tier 1 Account?

A tier 1 account is a bank account that can be created with minimal or without any form of documents. This account can be opened with just your personal details such as first name, last name, sex, date of birth, phone number, and photograph. However, the account has a limit of N50,000 single deposit and has a maximum account balance of N300,000.

The tier 1 account is mostly targeted at the unbanked population and people living in rural us communities. When opening this account, it does not require a BVN, national identification card, or voter’s card which makes it an easy entry point for hackers.

The advantage of this type of account is that it can be opened from the comfort of your home without going to the bank. The disadvantage is that hackers can easily access your account and it has a limit of N50,000 per deposit. This means you can’t receive more than N50,000 once in this type of account. However, if you want to increase your account deposit and balance limit then you will have to upgrade your account by providing the required documents such as BVN, national card, and KYC requirements.

What is a Tier 2 Account?

A tier 2 account is a bank account that can be opened with minimal requirements such as BVN, personal information, and an ID card. This type of account is opened by visiting the bank but you can upgrade to tier 2 from the comfort of your home if you are using fintech companies like OPay, or PalmPay.

Tier 2 account has a limit of N200,000 single deposit and a maximum account balance of N500,000. This type of account is slightly better than a tier 1 bank account because it is more secure and it can also be used as a saving or salary account.

The disadvantage of this type of account is that individuals or businesses can use it to perform high transactions. Moreover, you can’t receive more than N200,000 once in this type of account or have more than N500,000 in your account balance. Therefore, if you want to increase your account deposit and balance limit then you will have to upgrade your account by providing the required documents like utility bill and KYC requirement.

What is a Tier 3 Account?

Read all about access bank tier account limit

Tier 3 account is the high-level account that requires top-tier KYC procedures. To open this type of account you will need to visit the bank and provide all the necessary documents but you can also upgrade to tier 3 from the comfort of your home if you are using fintech companies like OPay, and PalmPay.

Tier 3 account has a limit of N5,000,000 single deposit and the maximum account balance is unlimited. The advantage of this type of account is that there is no limit which means you can receive any amount of money into the account and transfer any amount of money also. however, the disadvantage is that the upgrading process is always rigorous, and a lot of documentation is required.

FAQs

what is the maximum balance tier 3 can have?

Tier 3 is a high-level account with no limitation which means you can save any amount of money even N1 billion naira.

What is the maximum amount for a Tier 1 account?

Tier 1 account has a limit of N50,000 single deposit and a maximum account balance of N300,000.

What is the maximum amount for a Tier 2 account?

Tier 2 account has a limit of N200,000 single deposit and a maximum account balance of N500,000.

Conclusion: Difference Between Tier 1, Tier 2 And Tier 3 Account

All Nigerian bank uses the three-tier banking system as a series of level to structure and place limitation on customer account. However, you can always upgrade your account at any time even if you open a tier 1 account. All you need to do is provide the required documents such as BVN, utility bill, NIN, and KYC requirements.

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