There’s no need to stress over the process of choosing a bank for your small business.
We’ll start with the fundamentals, like a solid business checking account. Then we’ll expand from there.
Choosing a bank will involve keeping your immediate and long-term needs in mind. As you go through the list below, you’ll find out that many banks can meet those needs.
Of course, there is more to the best banks for small businesses than excellent business checking, savings, and credit car options.
They have a wealth of experience in the business loan industry and provide a variety of small business funding options. Who knows? Maybe you’re in need of a loan.
Whatever monetary needs your business may have, there’s a bank that can help you out. Let’s find out what it is.
The Top Banks For Solopreneurs
Chase
If you’re a small business owner gearing towards a more conventional banking experience, Chase is your best bet.
There are lots of Chase branches in almost every state, and the bank also offers superior online and mobile banking options.
If you’re on the hunt for a business credit card, Chase is also an excellent option. You can get free or cheaper flights with the Chase Ink Business Preferred card’s valuable perks.
Having both your checking and savings accounts at the same institution makes managing your finances online much simpler.
However, your company may incur fines if the account balance falls below $2,000!
Ultimately, Chase is the best option since it provides everything a business may want or need, including a wide variety of convenient locations, excellent business credit card alternatives, and cutting-edge digital and mobile banking services.
Wells Fargo
Wells Fargo is one of the most optimal choices for startups and small businesses. In terms of real-world financing and total loan volume, it is among the most active SBA lenders in the United States.
The bank has been around for quite some time, and it boasts an excellent selection of checking account services. It has a lengthy history of helping those who require small business loans.
Wells Fargo is a dependable financial institution that offers numerous lending options, including commercial real estate loans, home equity lines of credit, and personal loans.
You’ll have complete freedom over your company’s financial situation thanks to the availability of different funding options.
Loan amounts up to $100,000 are available, with repayment terms ranging from one to six years, depending on whether you opt for a secured or unsecured loan.
Wells Fargo offers three distinct business checking accounts:
- Initiate Business Checking
- Navigate Business Checking
- Optimize Business Checking
The monthly fees for these accounts are among the highest on this list, ranging from $10 to $75. However, these charges can be avoided by keeping a minimum monthly balance.
Wells Fargo offers what is arguably the best assortment of services for both businesses and their employees.
The bank will take care of your payroll, human resources, and business taxes in addition to providing you with its proprietary point-of-sale application and other merchant services.
Axos
If you’re on the hunt for an online business checking account, Axos is worth considering. When Axos Bank first opened its virtual doors in 2000, it was a game-changer for the American banking industry.
Top-notch banking services are nothing new for this institution, which has served both commercial and individual clients for many years.
With a very high $5,000 ADB, the Business Interest Checking account is completely free to use. A monthly cost of $10 applies if you do not meet his balance.
The account allows for up to 50 free transactions each month, making it unsuitable for businesses that often conduct more transactions or for those with low daily balances.
However, the APY is currently 1.01%, and there are excellent online and mobile banking features available.
As an added bonus, Axos provides a basic business checking account every month and includes up to 200 freebies and other perks per month at no additional cost.
To some extent, this may be preferable to the Business Interest Checking account, depending on your situation.
Besides CDs and a complete set of cash management services, Axos also provides money market and savings accounts specifically for businesses.
You’ll still have to search elsewhere if you need to accept cash deposits for your small business. The entire process is conducted online.
This is a remarkable feat for any bank, not just internet financial institutions. Consider Axos Bank for your online-only business banking needs!
KeyBank
Among the many banks that provide business checking accounts, KeyBank stands out for good reasons. The average monthly deposit limit for a checking account at other banks is between $5,000 and $15,000.
While some banks may charge fees on balances over $25,000, KeyBank has a flat $25,000 limit for all of its checking and savings accounts.
Business Interest Checking account holders also receive 100 monthly free transactions in addition to the 500 and 200 free transactions available with the Rewards and Basic accounts, respectively.
Monthly account maintenance fees, which vary by type of account, range from $5 to $25. As compared to the rest of this list, the minimum monthly average account balance of $7,500 required to avoid these fees is fairly reasonable.
A KeyBank checking account comes with a debit card for your convenience. However, Keybank’s Relationship Rewards® program allows you to collect rewards much as with a credit card.
With this account, you can earn rewards points for a variety of activities, including debit card purchases, online bill payments, ATM deposits, and mobile transfers. Your points can be redeemed for rewards, including cash, travel credits, and gift cards.
Navy Federal Credit Union
The commercial banking services provided by Navy Federal Credit Union are among the best in the country.
Bank accounts, credit cards, payment processing services, retirement plans, and health insurance for you and your staff are all part of the company’s infrastructure.
There is no profit motive at work for credit unions. This implies that generally speaking, they are more generous with their interest rates on savings accounts and impose fewer fees than for-profit banks.
You must sign up as a business member of Navy Federal before you may open a business checking account.
You need to become an individual member of Navy Federal first, and you can only do that if you meet one of the following criteria:
- Currently serving in the military
- Has served in the military
- Affiliated with the US Department of Defense
- An immediate family member of an active Navy Federal member
To become a business member, you must make an initial deposit of $250 for sole proprietorships or $255 for business entities.
You also need to have a savings account with the credit union and deposit $5 into it to become a regular member.
Although credit unions are more commonly associated with individual consumers than commercial enterprises, business owners who match Navy Federal’s membership criteria can take advantage of competitive interest rates on both checking and savings accounts.
Related Reading: Best Budget Planners – Find Out Here.
Bank of America
Tons of excellent banking services geared at small businesses are available from Bank of America.
This financial institution provides its customers with checking accounts, credit cards, and informational materials tailored to the needs of small businesses.
Bank of America is well-known for adapting its lending options for companies in specialized sectors, like agriculture and healthcare.
Business Advantage Relationship Banking and Business Advantage Fundamentals Banking are two types of business checking accounts offered by Bank of America.
To be expected, the Advantage account is geared toward larger, more established firms and has stricter requirements than the more accessible Fundamentals account.
Monthly maintenance costs apply to both accounts but are waived if the account holders satisfy specific minimum expenditure or balance thresholds.
Aside from the features available to Basics account holders, Advantage account holders also enjoy perks like its comprehensive integration with QuickBooks.
You can do your banking at any of Bank of America’s convenient locations around the United States, or you can use their handy mobile app.
In addition to core banking services, Bank of America also offers additional incentives to its business clients, such as tax preparation and point-of-sale (POS) systems.
M&T Bank
M&T Bank is a good option for East Coast residents looking for a commercial bank. There are 700 M&T locations in New York, New Jersey, Maryland, Delaware, Pennsylvania, Connecticut, Vermont, Washington DC, Massachusetts, Virginia, and West Virginia.
Relationship managers at M&T Bank do more than just provide banking services and answer inquiries from customers.
These financial experts analyze your company’s books from top to bottom to help you run things more efficiently.
M&T Bank, which offers a variety of bank accounts, boasts it is among the top 10 SBA lenders.
There are five different types of checking accounts available, and there are even more specialized accounts for the medical and professional service sectors.
The main drawback is that most of these accounts require a minimum balance to avoid fees.
The minimum balance you’ll need to maintain to avoid the monthly fee on the Simple Checking for Business accounts is $2500.
PNC Bank
There are more PNC Bank locations in the East and Midwest than in any other part of the country.
This bank offers a wide variety of useful services for companies, and its extensive online and mobile capabilities make it a good alternative even for people who don’t live in close proximity to a branch.
Any company that chooses to bank with PNC will get to enjoy a range of financial products, including checking and savings accounts, credit cards, merchant services, and loans.
In addition to their standard business checking account, PNC now offers Business Checking Plus, Analysis Business Checking, and the Treasury Enterprise Plan.
Except for the Analysis Business Checking Account, all other accounts have a monthly cost that can be waived under certain circumstances.
These plans cater to small, medium, and big enterprises. PNC allows customers to make a specific number of free transactions each month in addition to free cash deposits.
Analysis Business Checking, in particular, is developed with the goals of record-keeping and business simplification in mind.
Besides checking accounts, PNC also provides a variety of other services. Working with PNC will give you access to a variety of loan and finance programs designed specifically for small businesses.
Some loans, including unsecured ones, can be used for anything, while others, like those for real estate or equipment, have stricter requirements.
You can also take advantage of the bank’s merchant services, APYs on a number of business savings products, and the option to obtain business credit cards.
US Bank
While not quite as popular as some of its rivals, US Bank nonetheless provides a comprehensive branch and ATM network across the country.
The Silver Business account stands out since it doesn’t charge small businesses a monthly fee for maintaining the account as a checking account.
As each additional transaction costs $0.50, this account is best for companies that don’t make more than 125 per month.
Up to 25 mobile check deposits per month are free, and subsequent mobile check deposits cost $0.50 each.
Keep in mind that certain checking accounts carry monthly service fees of up to $25 per account if the average balance falls below a certain threshold.
US Bank, like the others on this list, offers bundled services such as credit card processing, payroll servicing, and invoicing. Because of this, it is a fantastic option for startups.
Regions Bank
Personal and commercial banking services are offered by Regions Bank, which is headquartered in Birmingham, Alabama. It offers five distinct types of business checking accounts, including:
- Simple Checking
- Advantage business checking
- Business Checking
- Not-for-profit checking
- Business interest checking
While all of these accounts (with the exception of Not-for-Profit Checking) do have a monthly fee, there are simple ways to avoid paying it. The minimum deposit required to open an account is $100.
Regions also offers four distinct business savings accounts for those wishing to compound their funds over time. There are a variety of business certificates of deposit available, too.
Even while Regions Bank’s interest rates aren’t the highest, they’re usually still higher than what you’d get with a standard checking account.
In addition to traditional banking services, Regions offers a wide range of specialized offerings to its commercial clientele.
Credit cards, loans (secured and unsecured), lines of credit, loans for capital equipment, cash management software, merchant services, payroll, and benefits administration, and much more fall under this category.
It’s evident that Regions is among the strongest of these small business banks. Additionally, Regions Bank made the list of the top 50 largest SBA loan providers in the United States through the second quarter of 2022.
Related Reading: Top Cash Flowing Assets – Dive Deeper Here.
Capital One
Capital One offers a wider variety of services to its business customers than its competition.
The bank’s business banking services are administered on a proprietary platform known as Spark Business Banking.
Spark Business Banking provides one-on-one support in the form of expert recommendations.
Capital One offers the usual financial services for businesses, including bank and savings accounts, loans, lines of credit, and more.
It also provides useful credit cards and merchant services to help you maintain your business.
Customers interested in business checking accounts have their pick between the Spark Business Basic Checking account and the Spark Business Unlimited Checking account.
You can make as many transactions as you like, and the monthly service fee is flexible. There are also escrow and other types of specialized checking accounts.
The Business Advantage Savings account from Capital One is a business savings solution. Capital One will also accept applications for business credit cards.
If utilized properly, several of these cards can fetch you and your company a ton of incredibly significant rewards.
SmartAsset includes one Capital One business credit card among its recommendations for the best credit cards for small businesses.
TAB Bank
While TAB Bank isn’t among the best banks for Small Business Administration loans, it is a good choice for companies that want to partner with a bank that has their best interests at heart.
Accounts receivable financing, equipment financing, asset-based lending, and factoring are just a few of the services offered by TAB to its business clientele.
TAB also offers two business checking accounts to choose from. To attract business customers, TAB offers a free business checking account with no monthly or yearly fees, in addition to 100 free debit transactions per month and extended customer service hours.
The Analyzed Business Checking account provides you with a dedicated relationship manager and eliminates the need to worry about debit transaction limits.
There is a $25 monthly cost associated with this account that is not refundable. However, you can get that fee waived if you meet one of the following conditions:
- $1,000 minimum daily balance
- $1,200 in direct deposits per monthly statement cycle
- Eight debit card purchases through your checking account during the monthly statement cycle (ATM transactions aren’t counted.)
Money market accounts, certificates of deposit (CDs), and business savings accounts can all help your money grow at the same time, as one of TAB’s many business loan solutions can get you where you need to go. In addition, TAB offers top-notch apps for both desktop banking and mobile banking.
Live Oak Bank
If you’re looking for an SBA loan, you should look no further than Live Oak Bank. It has processed and approved the largest dollar amount of loans in the country through the second quarter of 2022.
Customers can choose from the Small Business Administration loan, the Rural Development loan, or the commercial lending options provided by Live Oak.
Also, Live Oak Bank has earned a stellar reputation for being an excellent resource for businesses looking for appropriate loan products and financing at every stage of development.
Loans from Live Oak are designed specifically for your company’s circumstances.
Plus, the advantages extend well beyond that. A company that wants to save money and see that money increase should check into Live Oak’s Business Savings Account.
The annual percentage yield (APY) on a Business Savings Account with Live Oak is 1.75%, which is higher than the national average.
Your first deposit into the account is entirely optional, and there are no maintenance costs to worry about.
The features of your account can be controlled from either your computer or your mobile phone.
The lack of a business checking account is the primary drawback to using Live Oak Bank for commercial purposes.
If you’re a business owner who prefers to keep all of their funds in one location, you may find it inconvenient to have to search elsewhere.
Still, when looking for specialized business loan solutions that will aid in the expansion of your company, Live Oak Bank should still be a strong contender.
Citi
Small businesses in the medical, legal, property management and accounting fields can all benefit from Citi’s industry-specific offerings. Unfortunately, the A&D sector does not have access to these specialized programs.
However, the country’s fourth largest bank does provide a number of products and services tailored to small businesses, including:
- Citibank Business Credit account
- Business Installment Loan
- Business credit card
- Four types of checking accounts
Two of those checking accounts are likely to be the ideal choice for your small business.
For a monthly cost of $15 or $17 (depending on the location of your business), the CitiBusiness Streamlined Checking Account is the bank’s most basic business checking account. You don’t have to pay this fee if you maintain a $5,000 balance.
This checking account comes with the following:
- 50 free transactions per month
- Overdraft protection
- Cash management services
- Business debit card
- Online banking and remote check deposit
- Integrations with QuickBooks (for $15)
The CitiBusiness Flexible Checking Account is unique in that, although there is a higher monthly maintenance cost (the amount varies by state), it is not charged if the account balance is at least $10,000.
Plus, you’re allowed up to $5000 in monthly fee-free transactions and $20,000 in monthly fee-free cash deposits.
BlueVine
BlueVine offers small businesses a simple yet complete internet banking solution with their business checking accounts.
There are no recurring costs, and you may use them to make bill payments, apply for fast loans, and earn a reasonable rate of interest.
The application takes only a few minutes to fill out and will get you set up with an account the same day.
BlueVine goes above and beyond the norm by not charging any sort of maintenance, NSF, or deposit fees. In other words, you can make as many purchases as you like without paying anything extra. BlueVine does not mandate a minimum balance or minimum deposit, either.
Additionally, BlueVine’s checking account comes with a competitive APY of 1.5% on balances up to and including $100,000.
Those who don’t put at least $500 via their debit card each month or who don’t get at least $2,500 in client payments through their checking account each month are not eligible for this perk.
There are also commercial lines of credit available for up to $250,000 at rates as low as 4.8%. The application takes less than five minutes to complete, and a decision is typically made within that timeframe.
There are no BlueVine fees associated with creating, maintaining, prepaying, or closing an account.
Novo
Novo’s user-friendly interface, simple sign-up process, and streamlined digital payment options make it an excellent bank for a small business.
In less than 10 minutes, you may fill out and submit the application. You’ll be able to use your checking account after it’s been approved and you make your initial deposit of at least $50.
Novo’s success can largely be attributed to its intuitive smartphone app. Paying bills, sending money, processing payroll, or transferring money to your personal account may all be done in a matter of seconds when you sign into the app and take advantage of the bank’s free ACH transfers.
Staying on top of your financial commitments is much easier when you have instant access to your banking information and recent transactions. Moreover, the app provides a helpful summary of your monthly income and expenditures.
Novo’s checking account service is free of charge. To get your account up and running, you need to put in just $50.
This bank does not charge you anything for making a deposit of cash, receiving a wire transfer, or using an ACH. Novo is backed by Middlesex Federal Savings, FA, which offers FDIC protection, and reimburses all ATM fees.
What’s the catch here? Your checking account deposits will not earn any interest from the bank.
In terms of loans, Novo does not provide any. This service only provides checking accounts; no other forms of credit, such as loans or lines of credit, or business credit cards, are available.
Kabbage
Kabbage is in line with the modern approach to business banking by eliminating minimum balance requirements and reducing the number of fees associated with basic business checking accounts.
You can run an unlimited number of transactions through their payment processing system.
If you own a business and need access to working capital, a Kabbage business bank account is a perfect choice.
If you already use other Kabbage products like Kabbage Funding, Kabbage Insights, and Kabbage Payments, then this is the ideal option for you because of how well it works with those other services.
Kabbage’s business checking account is free. There is no required initial deposit and no charges for making deposits or withdrawals using the website.
While using an AllPoint ATM won’t cost you a dime, accessing an ATM from a different network will add $3 to your withdrawal. It costs up to $4.95 per transaction to make a deposit into your account.
If you’re looking for a high APY checking account, this one is among the best. It pays 1.10% on balances up to $100,000, second only to Bluevine’s lavish 1.5%.
The best part of creating a Kabbage account is that it comes with Kabbage Funding, which provides quick loan approval for lines of credit of up to $250,000.
Regardless of your credit history, this is a fantastic choice. A credit score of 640 is sufficient to have your application accepted.
A line of credit or checking account from Kabbage can be obtained after a quick and easy application process.
If you’re first denied for a line of credit but then your banking history shows that you should be accepted, you can utilize a Kabbage checking account to confirm your creditworthiness and have your loan approved instantly.
Lili
Lili is an excellent choice for solo business ventures. It resides in the foggy middle ground between individual checking accounts and commercial checking accounts for micro and small enterprises.
It’s not quite a traditional bank, but it does have the security of the Federal Deposit Insurance Corporation.
It offers services common to corporate checking accounts, such as invoicing, without the need for a plethora of unnecessary and costly add-ons.
However, this doesn’t mean that you cannot make use of any merchant services or loans. The free online bill-paying feature also makes this account a great choice for a business run by a single person, such as a sole proprietorship or LLC.
Traditional financial services provided by Lili are provided at no cost. Lili Pro, on the other hand, will set you back an extra $4.99 monthly because of the other features it provides.
An APY is not available on Lili’s regular products. With Lili Pro, you may earn up to 1% APY on your savings account. Using the service’s Automatic Savings function, you can have at least a dollar deposited daily into your savings account without any additional effort on your part.
Lili is not in the same league as a conventional bank, so it has restricted access to credit. Your debit card purchases are limited to a $200 overdraft, which is interest-free.
Related Reading: What Is Employee Stock Purchase Plan – Find Out Here.
How To Choose The Best Bank For Side Hustlers
Consider the size of the bank.
Size matters in the banking industry, but it doesn’t mean bigger is better in every case. Before deciding whether to bank with a huge financial institution or a local one, you should consider your business’s needs and your personal preferences.
Banks that fall into the “big” category typically have numerous locations, a wide range of services, and substantial financial backing.
They have access to several credit resources and may be able to provide incentives for you to open accounts or lines of credit with them.
It may be easier to get a loan or line of credit from a smaller, local bank since they may be more in tune with local market conditions.
They’re likely more prepared to work with you based on your character and overall profile rather than the cold, hard statistics of a credit score.
It’s possible that smaller banks will offer you a more favorable rate or a lesser fee in exchange for your business.
Remember that you will need a personal relationship with your banker regardless of whether you require the resources and diversity of a large bank or the local expertise of a small bank.
You’ll be dealing closely with these people, and a positive rapport will be invaluable if you ever have difficulties like late payments or overdue fees.
I suggest visiting bankers from both large and small banks. Find out what they can do for you by talking to them and asking all your burning questions.
Consider your credit.
The larger financial institutions can be selective about the companies they choose to do business with. Thus, if your company is relatively young or has a low credit score, you may have trouble opening an account at a large bank.
There is a possibility that new businesses in the area will find more leniency in the loan standards imposed by smaller community banks.
If you want to make sure your business bank accounts will meet your needs, research the credit standards of the banks you are considering.
Consider if you’re okay with purely online banks.
While it’s becoming increasingly popular to do banking online, it’s still wise to proceed with caution and do your homework first.
Creating a solid company credit history and rapport with a banker are both essential parts of banking, and both may be easier to do in person than online.
You may occasionally require personal interaction with a bank representative. A bank that exists solely online cannot provide such individualized assistance.
An online bank may be all you need if you’re just starting out and require only the most fundamental banking services (like a business checking account).
Think about the time and effort involved in making the transfer to a more conventional bank if you find that your online bank is unable to meet your future needs.
Consider the location.
Where is the bank branch situated? Think about how close the bank is to your regular hangouts and where you reside.
Do you anticipate needing to make deposits on a daily or weekly basis? How often do you visit an ATM when running a business?
Is there ever a time when you’d require a certified bank check? Do you frequently use ATMs on the road for your business and wish to avoid service charges?
To help you decide, think about the type of business you run and how often you’ll need to visit the bank.
Consider how often you anticipate visiting the bank and go from there. Similarly, if you frequently cross state lines, it’s important to have a reliable bank behind you the whole way.
Consider if you need a bank with a dedicated app.
What percentage of your banking demands are met by electronic means? Do you use online accounting automation?
Do you wish that you could make deposits with nothing but your cell phone? You might prefer digital banking alternatives if your business requires frequent travel or if it is heavily invested in technology.
If this is a priority for you, find a financial institution that is up-to-date technologically and offers the services you require.
Consider if you intend to work with the SBA.
If you’re looking into getting an SBA loan, networking with SBA lenders can be helpful.
The Small Business Administration provides a directory of banks that are willing to work with entrepreneurs by lending money, and it also helps business owners locate the most suitable lenders in their home states.
Consult with a loan officer at the SBA to find out what sort of banking options are available to you and whether or not you should restrict your search to institutions that will accept an SBA loan.
Consider the services you’ll need.
Every bank should provide a standard set of services. Learn everything you can about their business banking solutions, including the costs and conditions for using them.
While checking account fees are still prevalent, some financial institutions now offer no-fee business checking accounts to attract customers.
It’s important to shop around and compare the specifics of each bank’s products, as costs and criteria (such as minimum balance, checking fees, and monthly debit card usage limits) can vary substantially.
Inquire about getting a line of credit or meeting any other banking needs you may have for your business. You wouldn’t want to open a company checking account only to be told later that you can’t get a loan from them.
Consider if you’ll need support.
Some financial institutions have dedicated personnel available to assist with the management and expansion of existing businesses.
As your business expands, you might find such experts useful. They may have suggestions for improving business operations, acquiring additional capital, or opening new branches.
Moreover, they could aid you with any payroll or tax problems you’re having.
Consider your future and current needs for assistance with your business when determining an account type.
When deciding on a bank, it’s important to take into account the availability of this service if you anticipate using it as your company grows.
It’s easy to track down an expert from the outside, but having one working within your organization has several advantages.
Related Reading: What Is A Good Salary – Get To Know Here.
Final Thoughts
A bank is an indispensable resource for small business owners. Don’t rush into choosing a bank without giving some serious consideration to your needs and the services each institution provides.
Keep in mind that you can switch banks if you’re not satisfied or if your business outgrows the one you started with.
Don’t ignore the importance of maintaining a positive working connection with your bank. Doing so will make your daily operations much smoother.
Source link
#Banks #Growing #Small #Business