Business Bank Accounts for Small Businesses

Business Bank Accounts for Small Businesses: An Effective Way of Managing Business Cash Flow

A business bank account makes it easier for you to manage the cash flow of your small business. It’s highly recommended if you’ve just started a new business or are planning to set one up. An account like that will let you keep financial transactions separate from your dealings.

Choosing the right bank has its benefits as well. There are several banks to choose from. People can opt for ‘online’ or physically contact banks for business accounts. Each bank varies in its expertise and merits.

Before choosing your bank, you’ve got to be certain about the type of business—its size, its nature, and most importantly, the approximate transaction that you are going to make using the account.

Once the owner is determined about the complexity and nature of his or her business, he or she can jump into this section to pick the right bank account that they need. You must consider the charges that they’ll deduct and the interest you’ll get annually while selecting the best type of business bank account for you.

What Is a Business Checking Bank Account?

Let’s get some basic ideas about business checking bank accounts in the first place.

If you think that a business bank account is something like “rocket science,” then I’d say you are taking it too hard, mate. Let’s make it easier for you. A business account is a bank account that allows you to make transactions between your business personnel and other B2B companies.

This type of account is generally free of charge. However, you’ll need to pay the necessary fees to make transactions. The good news is that these accounts come with promotional offers (most of the time). You can easily waive the fee by maintaining a few conditions. Such as keeping a minimum daily balance or making online payments and can earn some bonus instead.

You can establish both local and international transitions using a proper account as well. You’ll be asked to provide your social security number to open an account such as this. Besides, legal documents regarding your business need to be passed to the bank authority.

You can read all about the necessary documents in our blog, where we discuss things in detail. I’ll repeat myself here: you can receive money from your customers and also pay your provider using this account. It’s kind of similar to the typical personal bank accounts that you use to make your daily transactions in this regard.

But there are some differences between them as well. The substantial difference between a personal bank account and a business bank account is that the owner of the latter is the business itself. That means all the responsibility that comes with this account goes with the business.

Yeah, of course, when you have a licensed business, no matter how small it is, it holds a self-identity.

Now, it can operate functions openly for its own sake. This is the moment you grant wings to your business by establishing a business bank account to stimulate financial tasks independently.

You may wonder how it can make transactions by itself. Wait, don’t get confused. You need to add the person’s authorized signature to confirm the transaction’s validity. The authorized person is you.

But, in case you need someone else to manage your cash, you have that option as well. You can add or replace that authorised signature to handle the account for multiple people. You need to provide personal information about that person, such as their social security number or driving license.

However, to keep things safe and clear for your sake, it’s wise to mention to the bank authority the role of that person in your business, such as treasurer, accountant, employee, or partner.

Usually, some banks have a specialty in a particular type of banking. For example, if you think that your business transactions will largely depend on electronic methods such as ATMs or online. For payments, you should look for banks that offer cheap and free electronic transactions.

Reasons Why You Should Have a Bank Account for Your Small Business

If we talk about the benefits of a business bank account, then the first thing that should be mentioned is that it gives you a clear picture of your business fund. Besides, it’s not a good practice to use a personal bank account for business dealings. You’d like to keep track of your business cash flows separately rather than mixing it up with personal transactions. At the same time, it’s a huge legal advantage.

You’ll be asked to provide income statements while tax time rolls around. At that time, you would not want to scratch your head and look around for papers to get the information. The business bank account will ensure you get the tax procedure done within the minimum amount of time and hassle-free. 

This type of account can save you money while any internal assessment regarding an audit needs to be done. It’s like a ledger of all your expenses and incomes from the business. In case of any dubious situation, you can ask for a record of your account and get the papers to make things clear.

No matter how small your business is, the IRS could audit it at any time. If you mix up your personal income with the revenue of the business, it’ll surely create an unpleasant scenario for your business and, hence, for yourself.

Another good thing about a business bank account is that it carries a ‘professional’ attitude. Using a personal bank account to deal with things for your business is a decent way to prove the lack of seriousness in the art of dealing.

Your business bank account represents the business itself. It not only ensures a secure and one-stop financial station for your business but also glorifies its identity. You can understand that this type of financial dealing with your customers shouldn’t be done with a personal account, right?

So, these were the ideological benefits of a business bank account. Now, let’s talk about some of the monetary outcomes that you can relish with this type of account. 

Don’t think that a bank account works just to send and receive money.

A business account offers loans that come with attractive conditions. You can get a good amount of money from your business account and invest it to grow your business rapidly. Usually, it’s very simple and easy to get loans if you have a bank account named after your business.

It will be easier for you to manage electronic payments online to quickly and efficiently disburse funds to employees or vendors. Besides, credit cards, ATMs, drafts, and various official work can be done using a business checking bank account.

But the most important thing is that a business bank account separates the personal liabilities of the business from yours. If anything goes wrong for the business, for example, bankruptcy, you could still find a way to escape the penalty from a legal standpoint.

7 Top Banks to Go to for Accounts for Small Businesses

Hundreds of banks offer business bank accounts with excellent features such as free or very low monthly charges, no or fewer introductory deposits, nationwide free ATMs, etc.

However, other basic beneficial sides of each bank also came into consideration before determining the best bank for business checking accounts.

BlueVine, Axos, First Internet Bank, Bethpage, Radius Tailored Checking, Bank of America, and Vystar are some of the best banks that currently offer good business checking features alongside the option of earning interest from balance.

BlueVine Business Checking Bank Account

BlueVine offers the best features of a business checking bank account. It comes at the top of the list for some valid reasons, such as an attractive interest rate on balance, a large number of cost-free transactions, and so on.

Bancorp Bank offers BlueVine as a banking service. You can say that it’s kind of a side business of the organization. 

Don’t feel insecure at all. because the Federal Deposit Insurance Corp. insures all BlueVine-related accounts for up to $250,000. It has multiplied in the industry as one of the most advanced and efficient online business checking bank account providers. Their mobile banking feature lets users download a dedicated app and keep track of their cash flow, which is time-saving and easy to operate.

By the end of 2020, BlueVine Capital Inc. will have been able to win the hearts of more than 200,000 customers with an approximate financing of $9 billion. It seems that BlueVine is growing at such a pace that its competitors are finding it very difficult to outplay the company.

This is very common among all other online businesses that check bank accounts that don’t require you to deposit cash physically. But BlueVine lets you deposit cash from more than 90,000 participating locations in almost 50 states in the US.

BlueVine will charge people in two scenarios. One is when they deposit cash from the Greendot retail locations, costing $4.95 per deposit, and the other is when they send wires, costing as much as $16 for each.

BlueVine can give an interest rate of 1% annually on all balances up to $100,000. As soon as you’ve deposited $1 into your account, you can start counting on your interest. This creates a good opportunity for you to earn a handsome amount of profit from your savings.

It also offers BlueVine Debit MasterCard. You can withdraw cash and pay for purchases with this card. Besides, it’s warmly welcomed for online shopping or conducting transactions at an ATM. There are 38,000 in-network ATMs for BlueVine.

There is no limit to the transaction and you can make a fee-free withdrawal from a large number of ATMs situated all over the country. Making unlimited ATM transactions and transferring money between accounts without any cost earns it the title of the best business checking bank account.

Furthermore, unlike many other banks, BlueVine doesn’t require any monthly fees or minimum opening balances. Also, you’ll be happy to know that there are no daily or monthly requirements on balance for BlueVine users. It’s a ‘ sigh of -relief’ feeling for the new entrepreneurs.

You should know that this is only an online-only banking solution. You’ll miss the physical presence of this bank. But to ease things out for you, 24/7 customer service is on offer. You can contact their responsive customer care representatives over the phone in case you need any help.

PS: BlueVine has temporarily paused taking new applications for business bank accounts since April 9, 2021. They’ll soon start the campaign again. In the meantime, small business owners can visit the bank website to include themselves on the waitlist and sign up for new accounts when they resume.

Axos Business Interest Checking Bank Account

Perhaps Axos is the only bank that offers both general business checking and special interest-yielding business-checking banking flexibility. To put it simply, the Axox Business Interest Checking bank account is fully dedicated to business holders who want to yield interest from it. You can claim as much as 0.81% APY from your balance up to $5,000,000. Even then, if your account balance is more than the mentioned, you can call the representative of the bank to claim more interest rates. 

However, Axon keeps this information confidential. People tend to earn interest from savings accounts where the cash is less liquid than a checking bank account. But this is a huge opportunity for business owners to earn some profits and also make some transactions, often using Axos business checking.

You should keep in mind that Axos doesn’t let you perform any operation free once you cross the limit of 50 free moves per month, be it debits, credits, deposits, or any other activities. They count on moves in general that you make using the account rather than counting on a particular service.

Don’t worry if you think you are going to exceed the monthly free limit on transactions. You’ll be able to make any kind of payment or withdrawal only for a charge of $0.50 for each transaction.

However, Axos comes with an ‘Axos’s Remote Deposit Anywhere’ feature, allowing you to make 60 free services for each month. It will let you deposit paper checks by scanning them with your Android or Apple device.

To open an Axos Business Interest Checking account, you’ll need $100 at the opening. Nevertheless, this is the lowest minimum amount in terms of all accounts that come with Axos. So, it’s a standout for this particular account.

On the other hand, Axos Bank will greet you with a $100 welcome bonus! This promotional offer will end on June 1, 2021. So, if you feel the terms and conditions of Axos suit your business, then open the account soon to enjoy the sign-up bonus.

There is a technical aspect that you need to maintain to avoid additional charges from the bank. You shouldn’t let the average of your minimum daily balance be less than $5,000 for a month. Otherwise, you’ll be charged $10 as a monthly maintenance fee.

Some additional features, like free image statements on mobile banking, the first 50 sets of free checks, unlimited ATM access with a fee reimbursement option, and a free bill payment option, are things that you’d like to enjoy with the attractive interest rate of Axos Bank.

First Internet Bank Business Checking Bank Account

Wouldn’t you consider yourself privileged when a bank offers you an APY of 0.30% that starts when you have just $10,000 in your account? Yes, the First Internet Bank is now one of the leading banks that offers high-yielding annual interest.

Not just this attractive feature that comes with the bank but also no monthly fees and unlimited free transitions are the stand-out points for business checking. Banks tend to put extra pressure on their account holders through multiple terms. But not in the case of the First Internet Bank.

There is no minimum balance required to keep the account running. All you need to do is deposit an initial $100 to open the account. After that, most of the work that you do will come almost for free.

Be it receiving deposits from your client or paying someone else, it’s all free of charge for the First Internet Bank Business Checking bank account. Besides, if you need to pull out cash at any moment, then the vast ATM network that comes with the bank will let you withdraw money from their partnered ATMs.

All the ATMs at this bank are free. Make as many transactions as you want using the free debit card provided by the bank and no monthly limit is burdened. There are 20,000+ ATMs for the bank to make it efficient for their customers.

Being a business owner, you’d need to transfer wires frequently. This account comes with the option of outgoing and wire transfer fees, both in the domestic and international arenas. The domestic outgoing wire transfer fee is $20, while the international transfer charges a fee of $50 per item. 

You should keep in mind that there is no physical presence in this bank. They are a particularly skilled organization when it comes to conducting business online. Their strong online and mobile banking network all over the country is really helpful for businesses that run in different corners of the states.

Besides, you should consider this bank account if you think you need multiple bank accounts in a bank that comes with a high-yielding interest rate. There are different business accounts, such as a business savings account for this bank, which offers higher APY rates and interesting features.

Bethpage Free Business Checking with Interest

Bethpage’s free business checking account is offering a 0.20% APY, along with many other easy and friendly facilities for small or sole-proprietor business holders. Though they’ve put some conditions for the account holder to earn the interest, it also gives benefits like lower loan costs.

Bethpage Federal Credit Union has been around since 1941. They have a variety of bank accounts and have been providing services for their customers for more than 50 years. Their business checking bank account is one of the popular centers of attraction for the company.

You should remember that Bethpage will implement some conditions before letting you earn a profit from your savings. You’ll have to enroll in their online banking, make direct deposits, and use their debit cards 10 times a month to earn profit from the interest.

You won’t require a minimum balance to keep your account running. All you need is a $5 start-up to create the account. There is no monthly charge or transaction limit for the Bethpage business checking bank account.

Unlike other banks, you won’t be charged to make deposits into this bank account whatsoever. There is no limit on deposits, either. Besides, there are 30,000 ATMs nationwide to withdraw money for you at any moment.

Bethpage not only offers a healthy APY but also a lower cost on loans, which is an advantage for business holders. A loan in time can make it beneficial for the business to invest money and make the most use of it.

Bethpage operates from just a few branches of their own but they’ve got more than 5,000 shared branches to serve their customers. Besides, they have free online and telephone banking features to make things comfortable for the customers.

You’ll be provided with a free business debit card from the bank within a few days of your application. If you wonder what you need to open a business bank account at Bethpage Federal Credit Union, then note the factors below so that you can arrange the papers beforehand.

  • The first thing you need is your business certificate. 

  • Then the Social Security number or proof of tax ID number will also be required. 

  • Besides, you’ll have to fill out the Bethpage Sole Proprietorship Resolutions Form if you are a sole proprietor. 

  • Lastly, your driving license is for your official signature.

Radius Tailored Business Checking Account.

Radius comes with their basic business checking online they claim to be the best in the industry right now. Their business checking account takes just around 10 minutes to set up online. The most interesting thing about their account is that they offer up to 1.5% cashback.

Though there’s no minimum amount required for the account, you need to deposit $100 at the opening of the account. That’s all; there are other monetary requirements to keep the account alive. But you’ll need to maintain a minimum of $5000 to waive the maintenance charge for the account.

Radius Tailored Business Checking comes with a 0.10% APY on all balances over $5000. An excellent cashback offer along with a 0.10% annual interest option gives it the value of being among the best checking accounts.

There is a limited-time offer for you to enjoy 1.50% cashback when you shop in the following categories: advertising, computer equipment, and computer services. Also, you’ll be honored with 1% cash back on debit card purchases, and it’s UNLIMITED!

However, since you own a growing business, it’s always wise to pay some attention to the extent of earning interest from your checking account. Radius offers a maximum of 0.10% APY for its clients. You can earn the interest once you have a balance of $5000 or more.

Worldwide free ATM access really gives a bonus point in the ever-competitive banking industry. Radius rebates the fee for your ATMs so that you can enjoy free withdrawals worldwide from third-party ATMs.

You can Radius accounts to Mint, QuickBooks, or Quicken for better hustling. Besides, having a Radius business checking account means full service at your fingertip. The Radius mobile app that comes with the account will let you manage mobile check deposits or overview transaction histories.

Besides, you can pay bills, transfer funds, and send wires anywhere within a second with the Radius mobile app. Radius comes with the additional feature of sending great-looking invoices straight to your customers’ inboxes within minutes. These invoices will inspire your customers by allowing them to instantly make payments using their debit card, credit card, or electronic bank transfer.

Radius has some point in awarding the best business checking accounts of 2020. Their firm security system behind the operation deserves kudos. They have 256-bit encryption to ensure that data is protected with the highest level of security.

Furthermore, all the account deposits are FDIC-insured up to the highest possible amount allowed—$250,000. So, you shouldn’t be worried about the safety of your account once you’ve got a business checking account on Radius.

Bank of America Business Advantage Banking Account

There are times when experience and reputation count. This is where the leading bank in America, namely the Bank of America, comes into consideration. Currently, the renowned bank is offering a chance to earn up to a $500 bonus for new small business bank accounts.

If you want to critically appreciate a bank from an overall point of view, then this is the best bank that you’d be looking for. You can make the maximum number of monthly cash deposits as well as earn a huge introductory bonus from the Bank of America business bank account.

You can earn a bonus of $100 by depositing $1,000 or more within the first 30 days of opening the new account. This bonus amount will increase to $200 if you deposit $3000 within the first month of opening the account.

In addition to that, you’ve got a chance to earn a bonus of $300 by spending $3000 on new online purchases within the first 90 days of getting the approval of your credit card. Honestly, no bank in the industry provides this much of a bonus right now.

There is no minimum balance required to open the account. However, you need to pay a monthly charge of $16 for the account. However, you can waive it by maintaining a few terms. You need to keep $5,000 of the monthly average balance.

Besides, at least $250 in new net-qualified purchases must be made using the Bank of America business debit card. In addition to that, you should become a member of Preferred Rewards for Business (first 4 checking accounts per enrolled business) to waive the monthly maintenance fee.

Bank of America is offering you a fee-free transaction for 200 items per month. After that, you’ll have to pay 45 cents per item. However, there is no excess transaction fee for the automated clearing house (ACH), debit card, online billing, and checks deposited through remote deposit online.

There is a strong network of 16,000 Bank of America ATMs nationwide. They won’t cut your pocket while you make any kind of transaction through their in-network ATMs. But you’ll have to pay $2.50 each time you make any transaction from a third-party ATM.

Though it seems that Bank of America is kind of expensive and defines rather difficult terms than other banks, they are the most reputed bank that operates in the USA. The best thing is that the credibility of your account goes up once the name of that bank comes with it.

VyStar Credit Union Small Business Checking Account

The VyStar Credit Union is the 18th largest credit union in America. The Florida-based organization has a huge asset behind its name and is one of the best among the credit union clusters. Currently, they are offering a competitive APY of 0.10% on all balances over $2500.

The Vystar Small Business Checking Account suits mostly sole proprietors. But the good thing about them is they let teenagers or college students open a business checking account so that they can run some side business alongside studying.

The account doesn’t require any opening deposits, which is really helpful for your startup businesses. Besides, there are no monthly charges for the account holders. In addition to that, you get the honour of processing up to 100 free items each month. You’ll be charged $.20 per item once you cross the limit.

These include check clearance, fund transfers, deposit items, withdrawals, and other credits or debits. However, you can securely manage your accounts online or on your mobile device using the Vystar Mobile Banking App. This truly adds a ‘bank on the go’ feature to your business.

There is an additional option of adding sub-users to your VyStar Internet and Mobile Banking account. You can give any of your accountants or bookkeepers easy Internet access to your business account so that they can make the transactions for you in your absence. You can limit the authority of an added person.

The highest free deposit or withdrawal is up to $10,000 cash per month. Once you’ve met the free limit, you’ll be charged $.15 for each $100 while depositing cash. You can make a deposit effortlessly from any VyStar Credit Union branch or ATM location near you by using Mobile Check Deposit.

They provide a nationwide ATM facility, though they charge extra bits of money for the third-party ATM providers and it varies according to the owner of the ATM. But a network of 20,000+ ATM booths is not so minuscule in number to provide you with surcharge-free services.

You should know that the VyStar Credit Union comes with two business checking accounts. One that is mentioned above and another named Regular Business Checking account, which is comparatively costly, requires rather difficult conditions, and also doesn’t let you earn interest on the balance.

The Picks of The Bunch in A Nutshell

From hundreds of banks offering business checking accounts, it is not easy to determine the best account. But if the choice is to be made on a particular criterion, then the task becomes easier. The top seven banks that come in this article are kind of similar in their offerings.

Yet, every one of them embraces a few differences. While BlueVine is the best among the top annual percentage-yielding accounts, Bethpage offers the best ATM networks. On the other hand, Radius deserves the affection for its lucrative cash-back offer.

Similarly, Bank of America’s Business Checking account is unparalleled to anyone else in terms of giving the highest amount of bonus on deposits and purchases. Far or less all the banks have excellence over their online or mobile banking facility, but with a 256-bit data encryption system and well-organized mobile banking app, Radius Tailored Business Checking is the best place in this regard.

Key Considerations Before Opening Business Checking Bank Accounts

As the title goes, a business checking bank account is basically for the people who have businesses owned by them. But before choosing a particular bank for your account, you should consider some important facts like the number of free transactions they offer, how safe the bank is, and the maintenance cost.

Don’t choose a bank that puts a huge load of maintenance costs on you. Don’t let it consume a portion of your profit in the name of maintenance costs. Try to read all the terms and conditions before applying for the account.

A business checking bank account is not only a medium of doing business transactions. It’s also a handy way of earning interest from the idle money that remains in your account. Try to choose the banks that come with a handsome rate of interest so that you can put an extra layer to your profit.

Try to choose the same bank that you’ve been familiar with in the past. It’s always better to take the paths that you are accustomed to. You shouldn’t take any unknown turn to put the wagon of your capital at risk.

Go to the website or call the representative of your current personal account to check if the bank has the option of a business checking account. It’ll save you time and energy when you have all of your accounts in the same bank.

People should check up with banks by visiting them rather than conducting their businesses online. It’s not like online banks are less safe or possess any particular threat. Yet, it’s wise to be notified about the physical presence of your bank and the amount of stake that it owns behind the locker.

FAQs You Might Have About Business Bank Accounts

Even though we’ve tried our best to answer all your queries on the topic, we imagine you’ll have a bunch of questions about business bank accounts and their perks. Let us try and answer those for you!

Q1: How do I determine the best business checking Account?

Answer: Be it for a business, a start-up, or an established institute, the business checking account should be offering a free or very low monthly charge. Additionally, pay attention to the bank’s requirements for the minimum introductory balance, ATM fees, wire fees, and monthly transaction charges. Try to evaluate if you need an account that offers free in-cash deposits or not. If you need the in-cash deposits badly, then go for the physical banks rather than opening an account with an online-only bank

Q2: Can I use a personal bank account for my small business?

Answer: Yes, you can. No one will stop you from using your bank account for your small business. Unless you want trouble for yourself, It’s highly recommended that you open a separate bank account for your business.

It’ll let you evaluate all the incomings and outgoings of cash while you use a separate bank account dedicated to business. Besides, it’s a good way to keep your dealings safe from overdrafts.

Q3: What do I need to open a business checking account?

Answer: Usually, the trade licence of your business and your Social Security number are asked for. However, the driver’s license can be asked to validate your signature. In terms of opening the account online, you’ll need to scan the papers and upload them in the application window on the bank’s website.

Q4: Do I need an EIN to open a business bank account?

Answer: Basically, you don’t need one but we recommend that you do have an EIN assigned. If your business is a sole proprietorship, then the chance of an IRS invasion is probably less, but never zero. However, if you have any employees who can access your account, you could be asked to provide the EIN for both safety and an IRS audit.

Q5: Can I open a business checking account at a credit union?

Answer: Yes, you can. This is a very popular site for opening a business bank account for your business. Both Federal Deposit Insurance Corp. (FDIC) banks and credit unions offer business checking accounts. There are also state-based credit unions that come with special offers for state residents.

To Conclude

A bank account for small businesses might seem costly in a particular state. However, in exchange for a bit of digging around, research, and selecting the right bank… you can save a lot of trouble. It is very important to keep a separate business bank account where all the whereabouts of your business transactions can be found within a few seconds.

The universal appeal of each business owner is to get the business checking account that offers the lowest amount of charge to do the dealings. Try to pick the best account for your business according to the nature and demand of your business and keep the earnings safe and secured.

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