Business bank accounts: Characteristics, benefits & best options in the market

What is a business bank account?

A business account is a bank account that is specifically dedicated to serving a business and its financial needs. Business bank accounts have specific features for businesses such as options to pay salaries, track income and expenses, and much more.

What is the difference between a business and personal bank account?

There are two main differences when it comes to business vs. personal bank accounts:

• The documents you need to open the account. With business accounts, you’ll have to submit various details, like the owners’ signatures and social security numbers, company information, and more.
• The cost of maintaining the account and interest rates. Business accounts often have higher maintenance costs, transaction fees, and minimum balance requirements but lower interest rates. They also have a better range of payment services than their personal counterparts.

What are the different types of business bank accounts?

• Business checking accounts: Used for day-to-day transactions and allow for deposits and withdrawals.
• Business savings accounts: Serves as a cash reserve where you can store funds for future use. Savings accounts offer competitive interest rates to grow funds over time.
• Cash management accounts: Similar to savings accounts, although interest rates may differ as you can withdraw outside of your savings period. You can use this account to store money and earn interest without limiting access to it.
• Global transaction accounts: Dedicated to speeding up and easing international transactions for businesses. These often minimize banking delays, process currency exchanges, and reduce waiting time for international payments to reflect.

The benefits of business bank accounts

Business accounts have many unique characteristics that can benefit your company. Some of these benefits include:

Separating your personal & business finances

Many new business owners make the mistake of handling their private and business finances from one account. This can lead to various legal, tax, and accounting issues that your business just cannot afford. 

With a separate business account, you can better manage your company finances and ensure that your personal finances don’t lead to greater problems for your business.

Introductory offers

When you open a new account, you may receive introductory business perks like discounts, low fees, or a total fee waiver for a specific period. These benefits depend on the business bank account provider you choose.

You may also gain access to educational courses and financial assistance options to help you get the ropes on handling your company’s money. Several small business bank accounts often have such offers.

Merchant credit card processing

Today, buyers often prefer to pay using their credit or debit cards due to convenience and safety considerations. Offering your customers several convenient payment options, including credit card payments, is necessary for you to operate your business successfully. Most business accounts include credit card payment processing in their packages and can help you meet your customers’ needs.

Website and mobile banking app

Convenience is essential not only on the customer’s side but also on your business backend. You want to access your funds, manage transactions, etc., anytime and anywhere. Opening a business account lets you access a business banking app and website account. You’ll have the luxury of managing your company finances on the go – from your smartphone or other digital devices.

Track your company finances

With an app and other features like transaction mapping, you can keep an eye on your expenses and business revenue. Monitor what your company spends its money on and keep evidence of spending through digital statements. This helps you identify unauthorized transactions and stop fraudulent activities early.

Having a business account also allows you to track payments from customers. You retain the proof of transactions, which you may need to handle different situations, like offering customer refunds smoothly.

Global payments

As your business expands (or depending on the nature of your work), you may need to interact with international clients and partners. You can benefit from making global payments via a business bank account or special international payment services.

Credit cards and other financing options

When you have a business account, your bank may offer you other financing options for being their customer. These include business loans, credit cards, and more. This isn’t necessarily exclusive to business account holders. However, you have an advantage in receiving better financing options as the bank already has a relationship with your company.

The top 9 business bank accounts

Here is our list of the best business bank accounts and services to consider:

Best for sole proprietors and contractors

HSBC Kinetic Current Account has all the features you need to successfully run your business as a sole trader in the UK. This account will help you to:

• Manage your account on the go through its reliable online banking system
• Stay on top of your finances using its expense tracking and cash flow analysis tools
• Get quick funding whenever you need to boost your business efforts through the in-app overdraft application feature

Best small business bank account

The best bank accounts for small businesses make it simple for you to meet your day-to-day financial obligations without increasing operational costs. This is precisely what the BayFirst free business checking account does.

You can manage your money from anywhere with its free mobile and online banking feature. And you won’t need to retain a minimum balance or monthly service fee to keep it active.

Best for medium-to-large businesses

Barclays is a top UK banking account service provider for established companies. With this bank, you can apply for different business accounts depending on your turnover or gross business revenue. Each account has specialized features, such as invoicing and accounting software, to help you manage your finances smoothly.

You can also access a team of business banking experts to guide you as your company grows.

Best for making cash deposits

NBKC Business Account is one of the best online business account providers. It has a flexible policy regarding cash deposits. This free checking account for businesses offers free deposits – both cash deposits and ATM deposits via MoneyPass.

Plus, you can deposit as much money as you wish monthly. The bank doesn’t limit your monthly deposit amount like many other banks.

Best for rewards

Consider a Chase Business Complete Checking account, if you’re looking for a business bank account with some of the best incentives for its account holders. The rewards you’ll get vary depending on your company size, account activity, and more.

For example, you’ll receive $300 for depositing $2000 within a month of opening your account. They also have great credit cards with high reward opportunities.

Best for digital experience

Axos Bank Basic Business Checking account is a great all-around option that can allow you to oversee all your activities online. This U.S. bank account includes digital features specifically dedicated to convenience and accessibility both online and in person like:

• Limitless, free cash deposits through MoneyPass and AllPoint machines
• No monthly maintenance fee
• Free nationwide ATM usage

Best for earning interest

Bluevine Business Checking is a cost-conscious U.S. account perfect for working with minimum fees while earning more interest on your funds. The account has zero overdraft, monthly, and transaction fees. Also, your account balance can earn interest up to 2%.

Best brick-and-mortar bank

Westpac is an excellent option for in-person banking, although it also provides dependable online banking solutions. You can easily access its standard banking services from its local physical bank branches in Australia and other global locations in Asia, New Zealand, and the U.K.

You can also complete some tasks via the Westpac Smart ATMs, including making cash and cardless deposits. This allows you to do your banking whenever it suits you.

Best for global payments & transaction processing

Although not a traditional bank, Payoneer is an efficient platform for international payments and transactions.

We understand what your business needs to expand beyond boundaries and provide practical solutions to help you operate globally:

• Different ways for your local and international customers to pay you
• Access your funds in multiple currencies at affordable exchange rates
• Use reliable invoice creation and payment solutions to pay or get paid quickly from anywhere

Our platform supports you and your business in these ways, and more, from one central place.

Choose your business bank account based on your needs

Choosing a business bank account is an important part of establishing your organization. It allows you to separate your funds, make secure payments, track your finances effectively, and manage income and expenditure competently. With an efficient choice, you can expand your company seamlessly, not just domestically but globally, too!

Ready to break local boundaries and enter the international business scene? Contact us today.