August 11, 2022

The 5 Best Business Checking Accounts

Running a business is a major financial commitment. Dealing with major expenses or unpredictable cash flow can be stressful, especially for a small business or startup. But setting up a business checking account can help you stay organized and even enjoy a few perks.

Business checking accounts typically function the same way as personal checking accounts. However, there are some key differences. Your personal account helps you manage your personal finances, whereas your business account is solely for your business use, says Tania C. Foster, founder and financial advisor with TF Wealth Advisors in Columbia, South Carolina.

Typically, business checking accounts allow you to write and deposit checks, handle a high volume of transactions, request multiple debit cards for employees, and perform other important business-related functions. There are also some differences when it comes to minimum balance requirements and fees. Many banks require business checking account holders to maintain higher minimum balances and/or pay a monthly account maintenance fee.

Depending on how your business is structured, such as a limited liability company or corporation, you may be required to establish a business account that’s separate from your personal account in order to protect your liability, Foster says. However, it can be a smart move even if you don’t technically have to.

Owning a separate checking account for your business can help simplify your tax planning, making it much easier to find and deduct business expenses at tax time.

“It’s easier to claim tax deductions when your business has its own bank account that clearly identifies your business expenses and income, separate from your personal accounts,” says Andrew Lokenauth, a finance executive at multiple companies. “Additionally, if you are ever audited by the IRS, you will have a paper trail of business spending in your business checking account.”

Plus, a business checking account allows customers to pay the business directly, rather than you personally, which elevates your professionalism and trustworthiness.

What Makes for a Good Business Checking Account?

When choosing a business checking account, carefully compare several options and look for financial institutions that offer affordable, robust services that meet the unique needs of your business. Below are some of the main factors you should look for in a business checking account:

Low fees. Fees vary widely depending on the bank and the account. A great business account will have low or no fees, Lokenauth says. He adds that online banks in particular tend to offer these benefits. However, you can find banks of all types that offer low fees or even free accounts.

Low opening deposit and balance requirements. Unlike personal checking accounts, business checking accounts often require a higher minimum deposit to open an account. Additionally, you may need to keep a fairly high balance in the account to avoid a monthly maintenance charge. The best business checking accounts will keep these minimums low, allowing more businesses access to a low-cost option. “You’ll want to be cognizant of these features and actively manage your account so you aren’t paying unnecessary fees,” Foster says.

Nearby branches. If you have a physical retail location or deal with many cash transactions, you might want to consider a bank with branches and ATMs that are close by and easily accessible.

Quality of online banking. “As a business owner, your time is money,” Foster says. These days, online banking is a must, whether you’re a small mom-and-pop shop or mega online retailer. The ability to quickly transfer funds, deposit checks and pay bills will ensure your business operates as smoothly as possible.

High limits on monthly deposits and transactions. Business checking accounts tend to limit the number of cash deposits and transactions you can make in a month for free. For example, you might be allowed up to $5,000 in deposits and 100 transactions per month, after which you’ll be charged a fee per additional transaction. If your business handles a lot of transactions, high limits in these areas will save you money.

Access to other products and services. Businesses need more services beyond checking. For instance, you might want to open another type of account or borrow money. Having an existing relationship with a quality bank that offers what you need makes finding and getting approved for these other services much easier.

The Best Business Checking Accounts

Now that you know what types of features you’re looking for in a business checking account, learn more about some of the top-rated accounts available.

Chase Business Complete Checking

Monthly fee: $15, or $0 if certain conditions are met.

Minimum opening deposit: $0.

Minimum balance required: $2,000 to waive monthly fee.

Best for: Businesses looking for a full-service bank that allows for payments on the go.

Chase Bank‘s Business Complete Checking account is popular among businesses of all sizes. Considering Chase’s national presence, with nearly 5,000 branches and 16,000 ATMs across the country, help with your banking needs should never be out of reach. This account offers built-in card acceptance through the mobile app, meaning you can take card payments anytime, anywhere. Account holders are allowed up to $5,000 in cash deposits per statement cycle without a fee, as well as 20 free transactions per month.

Capital One Spark Business Basic Checking

Monthly fee: $15, or $0 when minimum balance is maintained.

Minimum opening deposit: $250.

Minimum balance required: $2,000 to waive monthly fee.

Best for: Businesses with high transaction volumes.

If you want the breadth of services of a national bank but the convenience of an online institution, the basic business checking account from Capital One is a good choice. Though Capital One does cap free deposits at $5,000 per month, one of the best features of this checking account is that there are no fees or limits on monthly transactions.

Kabbage Checking by American Express

Minimum opening deposit: $0.

Minimum balance required: $0.

Best for: Account holders who want to earn interest.

This online business checking account, which is provided by Green Dot Bank and backed by American Express, comes with no monthly maintenance fees and offers 1.1% annual percentage yield on balances up to $100,000. Account holders can make cash deposits – for a fee – at about 90,000 retail locations nationwide, while the mobile app also allows for deposits and contactless purchases. You must be a Kabbage customer to open a checking account.

BlueVine Business Checking

Minimum opening deposit: $0.

Minimum balance required: $0.

Best for: Small businesses with a high volume of transactions.

One of the biggest benefits of the checking account from financial technology company BlueVine is its lack of fees. The account comes with no maintenance or insufficient funds fees. There are also no ATM fees when using one of the 37,000 MoneyPass ATMs available nationwide. Plus, account holders are allowed an unlimited number of fee-free transactions for paying bills and vendors via ACH transfer, wire or check. Account holders also enjoy 0.6% APY on balances up to $100,000. One downside, however, is that cash deposits through BlueVine’s partnership with Green Dot do require a fee.

Minimum opening deposit: $50.

Minimum balance required: $0.

Best for: Tech-savvy entrepreneurs.

Novo, an online-only banking platform designed for small-business owners and entrepreneurs, charges no fees to open or maintain an account. Plus, it’s extremely mobile-friendly, allowing you to do things like deposit checks, perform transfers and pay bills from your phone. The Novo debit card is accepted worldwide, and your account dashboard integrates with other business tools you may already use.

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