The revolution in the banking industry has not eased operations but also provided the much-needed convenience to access to money. Different types of bank accounts are available, depending on a client’s needs and want. For instance, people are able to access one account if they are joint account holders. Others can have access to an account if they are authorized account users. While the difference between a joint account and an authorized user may be blurred, these differ when it comes to credit reporting and liability. 

What is a Joint Account?

This is a brokerage or joint account that is shared between two or more people including business partners, couples, relatives or people who have trust and familiarity between themselves. These can be long term accounts or temporary accounts such as accounts opened for the need to meet a certain purpose, after which it is deactivated. 

Joint account holders are responsible for any fees, charges and payments that may be incurred in the running of the account. Examples of accounts that can be jointly held include credit product accounts such as mortgages, lines of credit, credit cards and savings and checking accounts. 

Both parties should be present while opening a joint account, which ensures full authorization. 

Benefits of a joint account include;

• They enable account holders access account benefits that would otherwise be difficult to access for a single account holder such as access to credit facilities
• It makes it easier for couples to pool resources for mortgage, debt, rent or bills payments

On the other hand, disadvantages include;

• The unlimited access to funds by the parties may affect all other parties especially where one party such as a spouse has difficulties controlling their spending habits
• All parties are liable for the charges and fees
• Funds may be seized by the government to satisfy an outstanding order such as child support or bank taxes

Who is an Authorized User?

This is a person who has legal access to a credit account but is not legally responsible for paying the bills incurred with the credit card. The person is also not authorized to make any changes in the account and does not have full access to the account credit report. Authorized users basically have access to the account information including fees and balances. They can also initiate billing disputes and make payments. However, the users can not change the PIN or address, add another authorized user, request for an interest rate and credit limit change or close an account. 

Although late payments affect the credit history of an authorized user, he is not obligated to repay any credit card debt or account charges. An authorized user can also be added to an established account irrespective of their credit history at any time. 

Similarities between Joint account and Authorized user

• Both users have individual credit cards
• Both can make changes to the accounts

Differences between Joint account and Authorized user

Definition

A joint account refers to a brokerage or joint account that is shared between two or more people including business partners, couples, relatives or people who have trust and familiarity between themselves. On the other hand, an authorized user refers to a person who has legal access to a credit account but is not legally responsible for paying the bills incurred with the credit card. 

Account obligations

Joint account holders are responsible for any fees, charges and payments that may be incurred in the running of the account. On the other hand, authorized users do not have any account obligations apart from initiating billing disputes and making payments. 

Authorization

While joint account holders have full authorization to the account, authorized users have limited account access and cannot change the PIN or address, add another authorized user, request for an interest rate and credit limit change or close an account. 

Joint account vs. Authorized user: Comparison Table

Summary of Joint account vs. Authorized user

A joint account refers to a brokerage or joint account that is shared between two or more people including business partners, couples, relatives or people who have trust and familiarity between themselves. Joint account holders have full authorization to the account and are responsible for any fees, charges and payments that may be incurred in the running of the account. On the other hand, an authorized user refers to a person who has legal access to a credit account but is not legally responsible for paying the bills incurred with the credit card. They have limited account access to the account and do not have any account obligations apart from initiating billing disputes and making payments. While both ease financial transactions among people, the ideal type of an account solely depends on the purpose of the arrangement. 

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