What should you look for in a business checking account?
The best small business banks are those that cater to a variety of business types. These can include traditional, brick-and-mortar banks that also offer consumer banking. However, some of the best business checking accounts actually come from online-only banks that specialize in small business banking. Finding the right one for you starts with deciding what you need -- and want -- from your small business checking account.
Reasonable fees and balance requirements
A big part of running a business is making sure your money is going to the right place. And the right place is rarely paying fees. Check that your chosen checking account isn't charging you monthly maintenance fees or other transaction fees you don't need to pay.
If you find a bank that you like but the account fee is too high, see if there's a way to have it waived. Many large, brick-and-mortar banks have $15 to $20 account fees on their business checking accounts. However, you can often get these fees waived by meeting minimum balance or transaction requirements.
Learn more: Checking Account Fees and How to Avoid Them
Practical transaction and cash deposit limits
A lot of business checking accounts have set limits on how many transactions and/or cash deposits you can make each month. This is particularly common in basic accounts without monthly maintenance fees. Make sure the account you choose has practical limits that won't impede your ability to effectively run your business.
Easy-to-use online and mobile banking
Whether you choose a brick-and-mortar bank or one that's online-only, your day-to-day tasks will probably be done digitally either way. Look for an online banking interface that's easy to navigate and a mobile banking app that has all of the features you'll need everyday, like checking your balances and making bill payments.
Business finances can be complicated. Great business bank accounts offer you tools and services that make it easier. For example, many of the best banks offer app integrations that make it easy to connect your third-party software programs and accounting platforms. You may also want to look for tools that let you send invoices or perform valuable data analysis.
Reliable customer support
No matter what type of checking account you choose, it's important to know the bank has your back if something goes wrong. This can be especially important with online-only banks. Make sure your online bank has phone support with real-life humans, not just emails or web chats with bots. For brick-and-mortar banks, consider the operating hours and how convenient it is for you to visit your local branch.
Business checking accounts vs. regular checking accounts
Functionally, business checking accounts and personal ones operate very similarly. You can pay bills, make deposits, withdraw funds, and buy things with your debit card just as you would with your personal account.
The main difference between your business checking account and your personal checking account is where the money comes from -- and where it goes. Your business bank account is specifically for your business finances. It's where you can receive payments from clients and customers, as well as pay vendors or employees.
Keeping your business finances separate is vital for efficient bookkeeping. It's also extremely helpful when it comes time to file your business taxes.
That being said, small business bank accounts will have certain features aimed at business owners that personal accounts don't offer. This might include the option to import or export to third-party accounting software, tools for managing vendor payments, and options for tracking employee spending.
Related: How to Open a Bank Account for a Business
Questions to ask before deciding on a business checking account
With so many options, even narrowing down the contenders can feel overwhelming. Here are a few questions to ask yourself to figure out what you want out of your new business checking account.
What kind of bank do you prefer?
Part of picking a bank account is picking a bank. But when it comes to choosing a bank, there are a lot of options. Do you want a bank or a credit union? Are you comfortable doing everything online, or do you want the option to visit a branch? Each type of bank has its own pros and cons, so think about what will give you the best experience.
Do you want to avoid account or transaction fees?
As with many things in life, with small business bank accounts, you often get what you pay for. But, do you need what you get? If the only thing you need is a basic business checking account with a good mobile app, then there are plenty of quality no-fee options. But if you have a lot of transactions each month or want/need extra service, a monthly account fee may be worth the cost.
How much money do you typically keep in your account?
Knowing how much money you tend to keep on hand can help you figure out your account options. Some checking accounts will require you to meet a certain minimum deposit amount just to open an account. And you may need to maintain a certain minimum daily balance to waive the monthly service fee.
Do you need to process customer transactions?
Some business checking accounts, especially at the basic level, have limits on how many transactions you can make each statement cycle. This often applies to electronic transactions as well as checks. If you have a lot of clients or customers, it's important to be aware of any transaction limits that could stick you with extra fees.
Are you going to be making regular cash deposits?
Similar to the transaction limits, many banks have limits on how much cash you can deposit each month. If you have an online business, those limits won't matter. But if you take cash payments from customers, a low cap on deposits could mean you wind up with an unsafe amount of cash sitting around. Or, worse, you wind up paying extra fees to get your cash deposited.
Do you want to earn interest on your balance?
Similar to the way a savings account can earn interest, some checking accounts may also let you earn interest on your balance. This is less common among business checking accounts than personal accounts. And many free business checking accounts have 0% APYs.
That being said, a few online-only banks do offer fee-free small business checking accounts that earn interest. These tend to have caps on how much interest you can earn, such as only offering interest on balances up to $100,000. Others may require you to meet specific activity conditions, like using your debit card a certain number of times each month.
Keep reading about our top checking accounts
