Although opening a bank account for a small business is not mandatory, a business account is a necessity for its financial success. Not only is it easy to manage the business financial accounts, but your business also gains a professional image when all financial transactions are done through a bank account. There is a wide range of high street banks and neobanks providing numerous account options for small businesses.
Choosing the bank that best suits your business needs can, therefore, be challenging.
This article outlines some of the best small business checking accounts and the criteria you should employ in choosing the right banking service provider.
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How to Choose Your Business Checking Account
Finding the right bank for your business, among the numerous banks that offer banking solutions for small businesses, can be overwhelming. However, you need to identify some factors that will help you filter out all the available bank options to give you the perfect bank for your small business. Here is an outline of what to consider when choosing a banking partner for your business.
Your Business Needs
You will need a bank that offers banking services that meet your business needs. Some of the basic services that a small business would rely on include loans and lines of credit, deposits, withdrawals, transfers, online banking, and credit and debit cards. Find out the details of these services and others before settling on a bank. For instance, you can find out the types of loans they offer for small businesses and the credit limit that they have.
Size
When it comes to business banking, the size of the bank is of importance. You will need to analyse your business needs to determine whether you would instead go for a small local bank, a medium-sized bank, or a large bank. Every size has different offers, capabilities, and expertise.
Analyse the Perks
Banks are interested in your business. Some will offer you a significant cash bonus for opening a business account with them. Others will provide your business with lowered insurance rates, hotel discounts, and payroll services. Perks are likely to be a big boost for your business. However, regardless of how enticing they may be, it is essential to see how the daily services provided by the bank meet your business needs.
Location
If your business is heavily involved in cash transactions on a daily basis, then you will need to consider the proximity of your business and the bank to choose. If a bank has several branches that are easily accessible, then that would be an added advantage.
Online Banking Services
Online banking has grown spontaneously in the past few years. Small businesses are now adopting neobanks in conjunction with traditional banks to run their financial transactions. You can make your savings, business payments, and pay bills through your phone in the comfort of your office.
Why You Should Choose an Online Bank ?
In addition to 24/7 access to your business finances, online banking has a lot of other benefits. They include the following;
- Lower fees.
- Real-time notifications on every financial transaction.
- They offer higher interest rates than traditional banks.
- Immediate and convenient transfers.
- Cheaper or even no fee for international transactions.
- 24/7 customer service.
- Opening an online bank account is easier and faster.
Top Small Business Online Banking Accounts
1. Monzo
Monzo was initially set up as a prepaid card. After its full licensing in 2017, Monzo now provides users with current accounts, access to overdrafts, and direct debits. The Monzo Pot is a feature that makes Monzo an outstanding banking account. The feature allows you to set aside and save money which is not reflected in your ordinary Monzo account. Other unique features include Joint Accounts and a Bill Tracker.
2. Revolut
Revolut is known for its unique service of allowing customers to trade cryptocurrencies. Revolut also enables users to transact in multicurrency. The majority of Revolut services are free. You can spend or send money internationally at no cost. Revolut also runs Revolut Vaults which are structured and operate just like the Monzo Pots.
3. N26
N26 is Revolut’s major rival based in Berlin. N26 has a customer base of over two million users, having been launched in the UK in 2018. Some of the features that make N26 to stand out among most neobanks include compatibility with Apple Pay and Google Pay, unlimited cash withdrawals across the UK, free card transactions, and bills tracking.
4. Starling Bank
Starling bank is the best option for a general-purpose checking account. This is because of the wide range of features that the bank provides to its users. Such features include fee-free international spending, access to overdrafts, in-credit interest, and savings goals. The Starling bank app also allows users to set up joint accounts for those who share financial commitments. You can also make free deposits to the Starling checking account through any Post Office.
5. Tide
Tide is designed to offer banking services to sole proprietorship businesses, small enterprises, and limited companies. Registering with Tide allows a business to enjoy 12 months of free bank transfers. The Tide Mastercard will enable you to run free transactions across the globe, in any currency. Users of Tide banking also get access to integrated invoicing and automated bookkeeping.
6. Monese
Just like Revolut, Monese is regulated by the Financial Conduct Authority (FCA) which protects the users’ money in case the app becomes dysfunctional. Monese is opted for by most businesses and individuals since no proof of address or credit history are looked into when opening a Monese account. The Monese app also provides users with visual graphs to monitor their expenses.
7. Holvi
Holvi is an online financial institution based in Finland. It was set up to provide financial services to entrepreneurs and freelancers. Holvi is built with unique features to enable small businesses and individuals to manage their finances. These features include bookkeeping, invoicing, an online store, and a debit card. Unlike most neobanks, almost all of Holvi’s services are offered at a fee.
8. Cashplus Bank
Cashplus is a provider of checking accounts and MasterCards to small businesses and individuals across the UK. Some of the features that make Cashplus an eminent challenger bank includes free Standing Orders, direct debits, free UK ATM withdrawals, and free UK transactions. You can also make payments into your Cashplus business account through any Post Office across the UK.
9. Clydesdale Bank
With the Clydesdale banking app, businesses can set up and manage their finances, process payments, and make direct debits. Clydesdale online banking also allows users to access digital financial statements and manage standing orders. Users can enjoy 25 months of free banking.
10. CountingUp
CountingUp is an ideal neobank for most small businesses. This is because of the wide range of free banking services offered to businesses that register with CountingUp. These services include automated bookkeeping, invoicing and bills, profit and loss reports, MasterCards, receipt capture, bank accounts, and sort codes. For three months, your business enjoys free transfers and subscriptions.
