Having a great business idea and the courage to work hard to make it a reality should be the only thing on your mind when running your business. It should be easy for you to manage your finances and partner with a financial institution or a bank to help you achieve your business goals.
We have put together a few resources to review the options you have when it comes to business banking and business bank accounts. Also, review other business services that may come in handy to take your business to the next level, like loans for your business.
The Basics of Business Banking
Let’s start from the very beginning by answering common questions you may have when starting a business.
What Business Account Should You Open?
Most business owners opt to open a business checking account to manage their day-to-day incomes and expenses. With a debit or credit account attached to this account, you can make purchases related to the business or make payments via direct debit or other methods to your suppliers. You can also collect payments from your clients if you use this type of business bank account.
In other business bank accounts, you can use our savings, money market, or CD accounts that allow you to earn interest on your business savings.
A specific account for businesses is a merchant services account that allows you to accept credit and debit card payments from your customers, for example, if you own a physical or online shop.
What Are The Types Of Business Bank Accounts?
For small businesses, as mentioned below, these are the most common types of business bank accounts:
- Business checking account: Manage your daily finances and receive and make payments for your business.
- Business savings account: Save money and earn interest from your savings.
- Business certificate of deposit (CD) account: Earn higher interest on your business savings for a fixed term.
- Business money market account: A hybrid between a checking and savings account.
- Merchant account: Receive credit and debit card payments from your customers in this account.
How To Choose a Business Banking Provider
You have several choices to open a business bank account that will mainly depend on the provider you choose. Generally, opening an account with a more traditional institution like a bank or a credit union may take more time than using a digital bank or online banking solution.
In terms of fees, big banks and more traditional institutions may charge monthly maintenance fees on your accounts. While some online banking solutions will still charge some fees, they may provide features like mobile apps, banking tools, or integrations with other systems that will make paying the fees worthwhile.
You may want to consider other things when choosing a business banking provider, such as what other business services or perks they can offer to grow your business. Some business banking digital solutions offer integrated lines of credit or business credit cards that will give you discounts on business operational software, points, or rewards.
How To Open a Business Bank Account
Once you have decided what route to take, you can then apply for a business bank account. Depending on the provider, you may need to go in person to an office or branch or complete the whole process online. Some digital business banking solutions also offer mobile apps you can download to complete your application through an app.
Regardless of the provider, you will have to prepare some information about your business before opening a business bank account.