How To Choose A Business Checking Account

In addition to keeping detailed records of your investments in your business, your business income, and your expenses, you may want to start using a separate credit card for as many expenses as possible. Business and personal banking are very different, and oftentimes business accounts charge higher fees, including penalties for excessive transactions or balances that dip below minimums. Just as every dollar matters to a small What To Look For In A Bank For Your Business business owner, so does every minute. You don’t have time to waste navigating an automated phone system while trying to contact your bank. This is why opening a business deposit account with a financial institution that offers personalized customer service is crucial. Does the bank rely on a team of real people for customer service representatives? Or does the bank present customers with a confusing phone navigation system?

• When unauthorized expenses occur, it is ideal to take possession of the card and stop the employee’s spending power.
• Tracking expenses, monitoring spending, and avoiding inadvertent overspending – all of which figure heavily into the success of any small business – are easier when you have a separate business bank account.
• Look at how they protect your data and the data your customers provide through their transactions.

Speak with other local business owners to get their opinions on local banking options. While you technically do not need a business bank account to use Shopify, it is generally recommended having a business bank account when starting or growing your ecommerce business. The next business banking product you may need is a business debit card. While most banking services operate online, sometimes you may need to talk to a bank representative or teller about conducting services such as sending certified checks issued by the bank. In situations like these, you may need a bank close to where your startup is located. Prior to researching your options, think about what you want from your business bank.

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Most banks now offer free business checking accounts so cost shouldn’t be an issue. Many banking institutions that offer consumer or personal bank accounts also offer business banking services.

Another factor that will significantly influence this decision is the type of business you run. Some banks will waive the service fee if you meet certain criteria, such as maintaining a minimum daily balance or signing up for another finance product from the same bank.

Ease of Doing Business

And establishing a saving account is a smart strategy that allows you to earn interest on your cash-on-hand and establish a reserve fund you can use to cover both emergency and planned expenses. Each business has its own unique needs, so the best bank for each business will vary. However, a great place to start your search is with the same bank you use for personal accounts. We provide third-party links as a convenience and for informational purposes only.

Once you’ve determined where you want to open your small-business checking account, identify which accounts you’ll need to transition. No business checking account will excel at delivering on every feature above, but not doing your research by thoroughly vetting banks could result in some unexpected fees that you could have otherwise avoided. Another reason you should open a business bank account is that doing so can help legitimize your business in your own mind. You will also qualify for interest on your business checking account.

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We suggest you read these brief reviews to see what you get with a free bank account compared to what you get in exchange for a relatively small monthly fee. Armed with this information, you’ll be able to make an informed choice and establish a business banking relationship that will serve you well now and in the future. At Stearns Bank, we understand all the challenges and opportunities you face as a small business owner. Whether it’s live support from helpful experts, https://www.wave-accounting.net/ full online banking capabilities, or uncomplicated account options, Stearns Bank’s business deposit accounts are made to help you reach your goals. Contact a business banking expert today to see how the BusinessSmart™ market savings account and BusinessSmart™ checking account check all of your boxes. A merchant account is a credit card business service set up by a financial institution, allowing businesses to accept credit cards as payment for goods or services.

They found that 79% of business owners use the same provider for their business banking needs as they use for their personal finances. Choosing the right banking partner is crucial for small business owners, who rely on the financial institution for receiving payments, paying bills, remitting salaries, and many more core business services.

Banks typically charge maintenance fees for a business checking account. Some banks waive these fees if you meet a certain minimum balance requirement each month, and many make these requirements relatively low so small businesses have fewer problems meeting them. In some cases, you can get a break on these requirements if you also have a personal account at the bank in question. If you use accounting software programs to manage business finances, then being able to integrate that with your checking account can make that easier. When comparing business checking accounts, check to see what the bank’s capabilities are when syncing up your accounts with your accounting program. With a business checking account, you may be making frequent deposits, withdrawals, bill payments or electronic transfers between accounts at another bank. One thing to check when comparing business checking accounts is what limits the bank imposes on those transactions.

• What’s more, a business bank account is a must if you want toaccept credit card paymentsfor merchandise or services.
• If you’re audited, you don’t want the IRS to note a history of mingling personal and business finances.
• Gershen-Siegel points out the National Cleaners Association as a great resource for dry cleaning business owners as an example.
• As an example, many companies keep money in a savings account to earn interest while building funds to pay off expenses like federal taxes.
• Some offer access to money market accounts or interest-bearing checking.
• You also have an increasing number of options for online accounts where you can open and operate your account 100% digitally.