The best banking options for small businesses

When it comes to the types of banking options and services a business needs, small business owners have never had more choices. Whether you’re looking for a high-interest online savings account to build a nest egg for your business or a checking account that you can easily deposit checks and make purchases, we’ve got you covered.

Understanding Banking Services for Small Businesses

Just like with the personal accounts that you have in your bank, you also have different account options for your business. For example, a business checking account allows you to channel income and expenses through a dedicated account for your business, as opposed to your personal account mixing the two.

As I said, we’ve never had more choice in business banking than we do today. You can have a business bank account online if you do all your transactions digitally … or a bank with locations just down the street. You can manage your finances through a mobile app..or work with a personal banker in an agency.

Gone are the days when every bank charged high monthly maintenance fees. There are now completely free business checking account options out there, and for those who charge a fee, there are often easy ways to opt out.

But that’s just the tip of the iceberg. There are many other types of business banking options, which we’ll cover in the next section.

Types of banking options for small businesses

Now let’s take a look at your banking options.

Business chequing accounts

The first type of account you will probably want is a checking account. With this account, you can deposit money or electronic funds and make payments by cash, debit card or check. Many banks allow you to get a business debit card not only for yourself, but also for employees who need to make purchases on behalf of the business.

Business savings accounts

Saving for rainy days (and unexpected business expenses) requires a business savings account. These accounts earn interest on the balance and may have a limited number of free transactions, after which fees may be charged.

Money market accounts

Money market accounts are a cross between savings accounts and checking accounts. You can make purchases with a money market account and it earns interest. As a rule, there is a need for high daily balance.

Small business financing

The best banks for small businesses offer more than just checking and savings accounts. Many are also lenders specializing in small business loans, including those guaranteed by the SBA. Are you looking for a loan for the purchase of commercial real estate? Or maybe a line of credit you can borrow when you need cash? Look for a bank that can deliver.

Business credit cards

Another type of banking service that you might be interested in is a small business credit card. With business credit cards, you can make purchases even if you don’t have cash on hand. Many offer perks like cash back or travel rewards, which can offset the high interest rates they generate.

What to look for in banking for your small business

You could probably benefit from more than one of the banking services mentioned above, so carefully consider each option to find a bank that can provide you with as many solutions as possible in one place.

First, determine if you need access to a physical branch or if 100% online banking is working for you. If you are doing business online rather than in person, you may not need branches nearby. And online banks often waive ATM fees everywhere.

Next, figure out if you can get what you need from a free bank account or if you need more bells and whistles that might require you to pay a monthly service fee. Look for banks that offer a high number of monthly transactions with low fees, if possible.

You absolutely want an FDIC insured bank, which means your money is protected even in the event of theft or data breach with the bank.

Beyond that, consider the requirements for opening a business bank account. What is the minimum opening deposit? How many transactions can you complete per month before incurring transaction fees? What are the other charges, such as overdrafts or ACH (wire transfers)?

And then, look for other business services you might need, such as merchant services, which allow you to accept credit and debit card payments through a card terminal or even on your phone.

The best banking options for small businesses

Sure, do your own research to find banking options that suit your needs, but get a head start with some that we can guarantee.

Check accounts

If you want a bank with local branches, consider some of the best business checking account options we’ve seen:

Chase offers a variety of other services for businesses, including its QuickAccept app with low card processing fees. Bank of America Business Advantage accounts offer preferred rewards, with no fees on certain banking services and no interest rate reduction on loans. Wells Fargo offers robust verification options, including mobile banking and mobile check deposits.

If you prefer basic online business verification, Axos has no monthly fees and will reimburse you for the ATM fee. There is no minimum balance required and you get up to 200 free monthly transactions.

Savings accounts

If your banking needs include a savings account, try these:

Capital One’s Business Advantage Savings Program allows you to earn interest on your money and complete up to six transactions per month. In addition, you can use Capital One’s ATMs free of charge.

And if you liked the sound of Axos’ checking account, you’ll love that the company also offers a savings account with a competitive interest rate. There is no monthly fee if you maintain an account balance of $ 2,500.

Money market accounts

If you like the spending capacity of a checking account and the interest features of a savings account, try one of these money market accounts for your banking needs.

Nbkc offers a free money market account with no minimum balance requirement. You can also get a professional Mastercard debit card for your account and earn 0.005% on your balance.

First Internet Bank lets you earn 0.40% for balances less than $ 10 million. A monthly charge of $ 5 applies, but you can waive this charge if you maintain a minimum daily balance of $ 4,000.

How to know which type of bank will work best for you

Whether you’re a new business in need of a small business checking account or an established business looking for tools to manage your cash flow, there is a banking solution that can meet your exact needs.

This article was originally written on October 5, 2021.

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