Your business needs its own bank account for compliance and accounting reasons and you’re not sure where to turn with so many options – should you stick with a local credit union or go for a robust international bank? Or maybe it would be easier to just stick with the bank you use on a personal level?
Worry not, in this guide we’re going to go through a list of the best business bank accounts we could find and why they’re worth considering. As you can see we’ve assigned them an informal star rating and included a duo of links with each section – one that takes you to a more detailed review and the other lets you hop right over to their site if you’re ready to get started today. Enjoy!
Their Spark Business Account sports no monthly transaction limits, monthly fees or minimum balances…which is pretty competitive. Do keep in mind this is meant to be a digital account and there are some drawbacks, for example no 0% period, bonus reward categories are hard to find, no travel perks, etc.
Some of the upsides though along with all the perks of digital banking include high, unlimited cash-back earnings, a user-friendly redemption structure, decent APR on their cards, and more. Their business accounts are known for their simplicity and overall flexibility when it comes to business-focused financial services.
Another major player in not only business banking, but lending. Most entrepreneurs need funding and resources to speedily/steadily grow their brands, and Chase can be a reliable partner in this arena. Then of course there’s top of the line credit services to go with it, payment processing, and a complex array of 21st century financial-tech.
Their merchant services are also top notch, but come with the fees you’d expect from such a global institution. However, as of right now there are some nice deals being laid on the table:
Right, let’s say you’re starting a new account in the state of California and are interested in Bank of America. First, keep in mind this institution goes WAY back (1784-1850) before 1904 when it set up shop in San Francisco… so it doesn’t get more mainstream. Global powerhouse.
That has its upsides and downsides of course, but let’s focus on the good stuff for now:
The #1 thing you’re looking for from a banking institution is help managing your business’s cash flow – giving & receiving payments, navigating fees, and leveraging the services that make sense. Two nice things about Wells Fargo are that both their Business Bill Pay and Business Debit Card Payments are free, and they’ll curate your cash deposit structure based on your needs (Business, Platinum, or Analyzed)
Are there huge differences between the major banks, no, not too many, but it pays to have a good understanding; the lay of the land so to speak. Feel free to visit their FAQs page to get some quick answers.
Another thing to consider when choosing a business bank account is how many physical branches they have and where you’re located. Individuals can get away with conducting 90% of their banking needs using their smartphone, but a company typically cannot.
That said, CitiBank has around 1000 physical branches, substantially less than either Wells Fargo or Bank of America. However, if there happens to be some around where you and your business will be, then it may be worth it to investigate both their Streamlined and Flexible Checking Accounts.
The big banks have huge amounts of capital so they tend to be the ones innovating new banking features – for example P2P banking or new 21st century ATMS.
Larger banks are now less vulnerable to economic slumps thanks to reforms and judicial actions taken between 2008-2016, but that’s not to say they are completely without risk.
Bigger banks mean more accessible ATMs and physical branch locations to a certain degree, especially within major cities around the world – convenience.
The sheer amount of financial services, online banking tools, and cutting-edge incentives is off the charts. Though some consider this complexity more of a con than a pro.
Obviously you’re going to get access to more capital in terms of loans and credit when dealing with a global banking institution vs. a smaller local bank.
Because of all the pros above, typically you’ll find larger banks charge larger fees than you’ll find with smaller, more consumer-focused, community/local banks.
Their customer service teams are, well, massive and usually spread across the globe which can be a downside in some contexts.
Also because of the size of their platform, it can be more mechanical and far less easy to negotiate, get fees waived, and so forth.
Oh boy, you’re out of your mind if you think we’re making this call for you. No way. If you don’t have a great accountant or business lawyer to take charge you’re going to either have to do some serious homework or look within your personal/professional networks for a rock-solid referral.
There’s so much involved, and the choice you make whether you’re just starting out or switching banks, will have a tremendous impact on your financials over the next year. Go through some of our reviews above, or, if you’d like to start with the business bank we use, head on over to Capital One and see why we chose them. Cheers!