At Remitly, we’re invested in your success as a business owner. One of the big decisions you’ll make when establishing your business is where to bank and what type of account to use. Luckily, there are plenty of banking options to support small and mid-sized enterprises. Knowing what features to look for so you can compare the pros and cons is key to your success.
In this article, we’ll break down the basics of business bank accounts in the US and deep dive into checking and savings accounts. By the end of this post, you’ll have a clearer understanding of how to choose a bank account that aligns with your business needs.
Comparing Bank Accounts: An Overview
With so many banking options out there, choosing the best fit for you and your business might feel impossible. Most business owners prefer to focus on both the banking institution and the account type. Understanding the reasoning behind choosing one bank over another is essential to making an informed decision.
Importance of Choosing the Right Bank Account
Keeping your money in a reputable bank means that it will be safe and secure. Many of these institutions are also FDIC-insured, which ensures your funds will be protected even if the bank fails.
It also allows you to manage your money more effectively and in a way that feels seamless and effortless. What’s more, it makes it easier to track your expenses and plan for the future.
You can expect some extra perks when you choose the right bank account. Taking advantage of these benefits can support your business growth.
Key Factors in Comparing Bank Accounts
Access to funds: A business bank account provides different access options for your money, giving you more flexibility. In addition to cash, you’ll have access to funds via debit cards, ATMs, and online banking platforms. Ensure that the bank account you choose provides access methods that are most convenient to you.
Interest rate: Many bank accounts offer interest on deposited funds, especially savings accounts. Compare different accounts based on their posted interest rates. You should also consider whether a minimum deposit is necessary for the account to accrue interest.
Costs and fees: Many banks make money by charging monthly service fees to operate accounts. As you research different account options, consider maintenance fees and any additional costs. These charges are often associated with transactions like cash deposits, overdraft fees, ATM withdrawals, and wire transfers.
Customer service: Of course, you’ll want to choose a bank that is easy to work with. Think about how important good customer service is and how you’d like to communicate with bank representatives. Do you want to visit your brick-and-mortar bank branch, or would you prefer phone support and online chat? Check to see how—and when—you can contact customer service representatives, too.
Convenience: Consider the location of bank branches and ATMs. Check to see if a bank will allow you to use out-of-network ATMs or if you could incur extra charges. Look into online and mobile banking options to ensure that the bank you choose will meet your needs and preferences.
Account Features and Benefits
Another thing to check when comparing bank accounts is the benefits they offer. For example, you might want to look out for features like:
- Accounts with no monthly maintenance fees
- Minimum balance requirements
- Unlimited transactions
- Wire transfers with no additional service charges
- ATM usage with out-of-network access
Types of Bank Accounts
Checking Accounts
Business checking accounts are a flexible banking option for everyday transactions. If you’re moving money around on a regular basis, a checking account will help you deposit, withdraw, and pay bills through checks, debit cards, and online transfers.
These accounts are best for short-term goals and everyday needs.
Savings Accounts
Savings accounts are a secure way to hold your money for future needs. They offer higher interest rates on your deposits and are ideal once your business has enough capital for reserves.
Certificates of Deposit (CDs)
CDs are savings accounts with higher interest rates and fixed terms. You commit to leaving your money untouched for a set period in exchange for better returns.
Money Market Accounts (MMAs)
MMAs blend savings and checking features—offering interest along with limited check and debit card access.
How to Choose a Checking Account
Understanding Fees and Charges
Evaluate monthly maintenance and transaction fees. Some banks waive fees based on minimum balances, while others offer accounts with no maintenance charges at all.
Access to Branches and ATMs
Traditional banks offer physical access, while online banks may compensate with wider ATM network access.
Online and Mobile Banking Features
Ensure mobile apps and websites offer conveniences like check deposit, instant transfers, and account alerts.
Noteworthy Checking Accounts and Their Features
Low Fees and High Interest
- North One Standard Business Checking: 2.5% APY, no monthly fee or balance requirement.
- Grasshopper Innovator: 1.8% APY, requires $25,000 minimum balance.
- Bluevine: 1.5% APY on balances up to $250,000, no monthly fees, up to five sub-accounts.
Excellent Customer Service
- American Express Business Checking: 24/7 support via phone and chat.
- US Bank Business Essentials: Brick-and-mortar access with no fees.
- Chase Business Complete Banking: $15 fee (waived with $2,000 balance), large ATM network, QuickAccept payments.
Mobile-Friendly Options
- Relay: Supports multiple accounts and QuickBooks/Xero integrations.
- AXOS Basic Business Checking: No fees, free ATM deposits, unlimited withdrawals.
- Found: Includes built-in tools for invoicing and tax planning.
Comparing Savings Accounts
High Interest Rates
- US Bank Platinum Money Market: Up to 4.0% APY.
- Live Oak Bank CD: 4.3% for a 12-month term.
- Prime Alliance Bank Savings: Up to 4.0% for balances over $200,000.
Transaction Limits and Fees
Confirm monthly transaction caps and potential fees.
Direct Deposit and Fee-Free Options
Look at AXOS, Grasshopper, Truist, Holdings, and traditional options like Wells Fargo and Capital One.
Next Steps in Business Banking
Are you a self-employed freelancer, small business, or mid-sized operation? Opening a business bank account is a great way to establish your brand. It also helps your company curate professionalism and gain access to some perks that can support long-term success.
Compare some different business bank accounts before making your choice. There’s an option for everyone, whether you’re interested in online banking, traditional checking and savings accounts, or accounts with no monthly fees. Once you find an account that suits your needs, review the requirements and submit your application—it can be a helpful step in building a solid financial foundation for your business.
FAQs
Which banks are best for business banking?
Start by identifying your needs—client payments, payroll, etc.—then compare banks based on services, fees, and accessibility.
What type of bank account do I need for my small business?
Typically, a checking account for daily operations and a savings account for reserves. CDs and MMAs may suit long-term goals.
What is the FDIC, and is it important?
The FDIC insures deposits in case of bank failure. Always choose FDIC-member banks for added protection. Use their “BankFind” tool to verify.