Why you need a business checking accountIf you are small business, it might be tempting to keep all of your business funds in your personal account. It is crucial that you do open a business checking account to help manage your funds, process transactions, pay employees, and perform basic accounting. A business checking account offsets personal financial risk and works to effectively protect your own assets. Additionally, if you plan to apply for a business loan in the future, you will need to have an established business checking account to qualify. Opening the right account will help lay the groundwork for future company growth.
Different types of business checking accounts and when to use themA small business is defined as a for profit business that is owned and operated independently. Small businesses have somewhere between five and five-hundred employees working on a daily basis. There are over 22 million official small businesses in the U.S. There are many different business checking accounts banks offer to accommodate businesses of all shapes, sizes, and industries. Here are some of the different types of businesses that might require unique checking accounts to match the way they operate:
Businesses with Less than $1,500If you are a business with less than $1,500 you actually qualify as a micro business. Micro businesses usually have less than five employees and make up a staggering 92% of all businesses in the U.S. There are also plenty of options for micro businesses that don’t require high minimum deposits or minimum deposits at all. When applying at a bank with multiple business checking options you should pick the smallest, simplest option as you likely won’t need the features of a bigger account with a higher monthly maintenance fee that accommodates a large amount of transactions.
Established BusinessesAre you a more established business? There are accounts that allow for more transactions per month without additional fees. You also might want to find a checking account that has a high interest rate so your larger balances can accrue value over time. There are different features that your business could benefit from like cash flow management or Quickbooks integration for easy accounting. A more established business has higher cash flow, bigger account balances, more employees, might be eligible for credit lines or loans and need a business checking account to match their size. Several banks have four tiers of business checking options so that even more established businesses have room to grow without having to switch banks.
High Transaction Volume BusinessesIf you are a business with high transaction volumes, you will need an account that offers a low monthly service fee and ideally a list of easy-to-meet requirements to help you waive that fee. You will also want strong merchant service features to create a link between your business checking account and your customers with cash management solutions to help track and manage profits. The main thing you will be looking for if your business has high transaction volumes will be transactions offered per month without high fees for every transaction thereafter.
Online BusinessesIf your business operates online maybe your business checking account should follow suit. Now there are online banks that have lower fees and associated costs. Online banks don’t have the overhead of a physical location to worry about and for this reason they are able to offer cheaper financial services, many even offer free small business checking accounts. You can bank from your phone or laptop anywhere in the world and get online customer support. As there are more and more businesses that operate online exclusively, there are more online banks with lower overheads and more affordable on-demand Internet banking services.
Companies That Do Business InternationallyInternational companies require international banking services. Use an international bank if your business decides to break through the borders. You could also find a domestic checking account that has low ingoing and outgoing wire transfer fees and international cash flow solutions. A bank with a robust online portal, mobile app, and 24/7 customer support could also work to support international banking needs.
What to look for in a checking accountTo help guide your business checking account process we have listed a few categories for you to consider before choosing a bank.
Monthly TransactionsEvery business makes at least one transaction monthly. While shopping for a business checking account you will need to review the monthly transaction allotment for each account advertised. Every business checking account lists the number of transactions it supports per month for free (or at least covered by the monthly maintenance fee) and then lists a fee that applies to each and every transaction that exceeds that specified limit. Normally every single transaction over that limit gets charged individually thereafter, which can become extraordinarily expensive. Try to calculate ahead of time to see what your monthly average has been and plan ahead considering potential growth spurts.
Average Daily Account BalanceAverage daily account balance is important to weigh heavily in your decision for two reasons:
- A higher balance needs a more premium account with more features to manage and support those funds. Your average daily account balance will depend on the size of your business, your cash flow and profit margins. Try to project your average daily balance best you can ahead of time.
- Maintaining an average daily balance consistently could be your ticket to a free business checking account. Accounts that meet banks’ minimum average daily account balance requirements usually have their monthly service fees waived.
Opening Deposit AmountIn many cases you will need to make an initial deposit to even open a checking account. These can range anywhere from $20-$1500. If you don’t have enough money to make to make the initial deposit, then you are automatically ineligible for the business checking account. While these initial deposits are normally within the financial means of the average small business owner, you might want to find a bank with a lower initial deposit, especially if you are simply moving money from your personal account into your business checking as a sole proprietor.
Physical Branch AvailabilityAs business becomes increasingly virtual more and more banks are moving their services online. There are less and less physical branches each year even at the largest banks. Some banks are region-specific and might not be located where your business is headquartered. If you need a physical banking location you will need to use a branch locator and do some research to see what bank branches are closest to you. This also extends to ATMs. Online banking and mobile deposit apps help to circumvent the need for banking at a physical location. Weigh the pros and cons of banking without a nearby bank branch or try to make a short list of banks that are closest to you for in-person financial services.
Size of Banking InstitutionThere are pros and cons when banking with either larger and smaller banks. Bigger banks often have more branch locations, more ATMs in-network, fee coverage for ATMs outside of network, and 24/7 chat and phone support. Large banks can also better accommodate business growth over time, ensuring you won’t have to switch banks if you don’t want to. Smaller banks offer more of a personal touch. You can get the individual attention you need at a small bank, which may be good for a smaller business just starting out.
Community BanksIf you like face-to-face customer service or hand-delivering cash deposits, then a bank in your community could be a great choice. Use branch locators on different bank websites to see if there is a bank right in your neighborhood. Small brick and mortar businesses or local retailers might need the in-person support a regional bank has to offer. At a community bank, you can build relationships with business banking representatives. They will be more available to you to answer your questions, address concerns, and help you apply for loans. Plus, you’ll have the opportunity to speak directly with the person who will be approving your loan.
Best 10 bank accountsNow considering all of the metrics we have outlined above, let’s review the top 10 best checking accounts for small businesses 2018.
Bank of America
Who This Account Is Best ForThis account is best for established businesses with steady growth or small businesses with a big future ahead of them.
Introductory Offers and FeesWith their Business Advantage Relationship Rewards Program you can reap the benefits of having a checking account, rather than just storing your money away to sit. The Relationship Rewards Program has many perks including:
- Feeless services like cashier’s checks, ODP transfers, deposits, and stop payments.
- Bonuses based on using the Business Advantage credit card for purchasing.
- Cash rewards for using the Merchant Services processing.
- An interest rate booster on a Business Advantage Savings account.
The Bank of America NetworkBank of America is the second largest bank in the United States and for this reason, offers an impressive 4,400 offices that businesses can visit around the country. This makes assistance accessible. You can sit face-to-face with financial experts and discuss any issues you might have, or to get help with managing your account services. Bank of America also offers approximately 16,000 ATM locations around the country, making it easy to bank on the go without having to pay out-of-network ATM fees. If you want all the benefits of banking with a large network, Bank of America is a premier choice.
Special FeaturesBank of America offers a wide variety of Cash Management Tools for businesses like:
- Payroll services
- Remote online depositing
- Account management
- Invoicing and payments by Viewpost®
- Merchant services
- Express tax services
- Treasury services for larger businesses
Who This Account Is Best ForChase is the largest bank in the country and is best for growing companies looking for the support of a big banking network.
Introductory Offers and FeesChase has a straightforward fee structure that’s affordable for checking and savings account users, but it’s important to take the time to understand the fees, otherwise you could get hit with costs that are completely avoidable. Chase is currently offering a $200 bonus for its Chase Total Business Checking account customers. To qualify you must meet the following requirements:
- Make a $1,000 deposit within the first 10 days of opening the checking account
- Maintain a $1,000 average daily balance for 60 days
- Make at least five qualifying transactions in the first 60 days
Chase Bank NetworkChase is one of the largest banks in the United States, and has an impressive 5,100 branches throughout the country and 16,000 ATM locations. This makes it very easy to find a location wherever you are, though Chase does not waive out-of-network non-Chase ATM fees for small business checking accounts, and offers to waive up to four fees for larger accounts.
Special FeaturesChase offers a range of nice features for business checking account holders that make life easier and more efficient.
- Mobile Payments
- Check account balances, deposit checks using your smartphone, receive text updates about your account, and make Zelle P2P payments.
- Quickbooks Integration
- Business owners can sync their Quickbooks with their Chase business checking account to more efficiently manage their finances and taxes.
- Fraud monitoring
- Chase bank provides its customers with free fraud monitoring to protect business checking accounts from suspicious activity and use.
- Paperless Savings
- If you decide to go paperless it can lower your monthly fee from $15 to $12.
Who This Account Is Best ForWells Fargo‘s business checking accounts are best for businesses that need flexibility to accommodate growth.
Introductory Offers and FeesThere are no introductory offers for business checking accounts at this time. Wells Fargo has standard business checking account fees if specific account minimums and averages are met relative to the checking account type.
- Monthly fee range from $14-$40 per month depending on which business checking account your business has chosen these fees can be waived if specific average monthly balances and services are used.
- Transaction fee: 50 cents for every transaction after the first 200 per month
- Cash deposit fee: 30 cents per $100 in cash deposited after the first $7,500 of cash deposits each month
- ATM fee: $2.50 per withdrawal and $2 per balance inquiry at out-of-network ATMs in addition to ATM operator fees.
- Domestic incoming wires: $15
- Domestic outgoing wires: $30
- International incoming wires: $16
- International outgoing wires: $35
Wells Fargo Bank NetworkThe Wells Fargo banking network has more than 6,300 locations across the United States with over 13,000 ATMs. Wells Fargo has more nearby branches than almost any bank in the country. If you are a business looking to receive face-to-face financial customer service, then the Wells Fargo network is one of the largest.
Special FeaturesWhen you sign up for a Wells Fargo checking account they, will include the following bonus features to personalize your business account.
- Custom Cards
- Wells Fargo offers complimentary card customization so you can put your business logo right on your company debit or card.
- Account Access Manager
- The Account Manager helps you to manage employees or partners who need to access funds. The account access manager acts as an intermediary to help maintain account security.
- Zero Liability Protection
- Wells Fargo will completely reimburse any suspicious unauthorized account activity like debit card or ATM withdrawals if they are reported immediately and correctly.
Who This Account Is Best ForThis business checking account is best for small companies that want a low monthly maintenance fees for their checking account in the U.S. or Canada.
Introductory Offers and FeesTD Bank is offering to waive monthly fees for upgraded small business checking accounts on the premise that you take out a small business loan. This isn’t necessarily an introductory offer as much as it is incentive to sign up for an upgraded small business checking account and get your business loan from TD Bank. TD Bank has some of the higher fees when compared with other top ten banks. Here are some fees to be aware of:
- Monthly fee: $10-30 depending on account type (you cannot waive the $10 fee for the simple checking account)
- Charge after transaction limit has been met on checking accounts
- Cash Deposit fee: $.20 for every $100 deposited after the limit
- ATM fee: $3 for every out-of-network ATM visit unless you have a Premier checking account
- Domestic incoming wire transfer fee: $15
- Domestic outgoing wires transfer fee: $25
- International incoming wires transfer fee: $15
- International outgoing wires transfer fee: $40
TD Bank NetworkTD Bank has a smaller physical network compared to the other top ten largest banks in the country with just 1,250 branches and 2,500 ATMs across the U.S. and Canada. TD customers can also access accounts using out-of-network ATMs for an additional fee. Their branch locations are also open longer hours than most other banks, seven days per week.
Special FeaturesTD Bank offers the standard special features that come with most business checking accounts like mobile deposit apps, overdraft protection, and ACH transaction options.
- Free mobile and online banking with Mobile Deposit
- Bank from anywhere anytime for free
- Make single-item deposits electronically via an app that scans paper checks and places the funds in your account
- Live Customer Service 24/7
- Receive customer support via live chat or phone call around the clock
- Branches are open seven days a week for in-person assistance
- Business Overdraft Protection
- Set up custom alerts about your balance so you can avoid overdrafts all together
- BusinessDirect ACH Payments
- Send money directly to any bank account
- Set up templates for transfers
- Use for payroll, vendor and tax payments
- Bill Pay
- Pay business bills online
- Set up one-time or recurring payments
- Quicken/QuickBooks Integration
- Make payments straight from your financial accounting software
Who This Account Is Best ForCitibank is best for high transaction business checking and businesses that anticipate a lot of growth.
Introductory Offers and FeesThere are no introductory offers currently at Citibank for business checking accounts. Citibank has competitive fees for wire transfer and avoidable monthly maintenance fees. The biggest fees at Citibank are the overdraft fees and out-of-network ATM fee. However, Citibank has many fee-free ATM locations, over 60,000 to be exact.
- Monthly Maintenance Fee $15-22 (can vary by state)
- Incoming Wire Transfer Fee: $15
- Outgoing Domestic Wire Transfer Fee: $25
- Outgoing International Wire Transfer Fee: $35
- Overdraft Fee: $34 each
- Non-Citibank ATM Fee: $2.50
CitiBank NetworkCitibank is a comprehensive bank that spans over 2,649 locations in 19 different countries and 723 branches in throughout the United States and also has 60,000 ATM locations for you to make use of. Whenever and wherever you need money, you should be able to find a place to access it, without paying a fee. Citibank is one of the largest banks in the country ranking 3rd just below Bank of America.
Special FeaturesCitibank checking accounts all come with a myriad of special features. Citibank has quite the offerings for checking account clients, without much added expense:
- Citibusiness Checking Plus Overdraft Protection
- Revolving line of credit to offer business checking accounts overdraft protection
- CitiBusiness Safety Check
- Automatically transfers finds from your savings account or insured money market account to give overdraft protection for linked checking accounts.
- Citibank Remote Check Deposit
- Scan checks using your smartphone and deposit them direction into checking accounts
- CitiBusiness Preferred Banking
- A service offer that gives customers preferred pricing, waived fees, exclusive rebates, and bonus rewards.
- Earnings Credit
- Credit based on the monthly average balance in non-interest checking accounts that have more than $5,000, to help waive monthly service fee.
- Cash Management Services
- ACH Origination
- Controlled disbursement
- Account or deposit reconciliation
- Currency services
- Investing options
- ACH debit blocks and filters
- CitiBusiness Online
- Online banking portal
- Fee-based Cash Manager Suite available
Who This Account Is Best ForCapital One Spark Business Checking accounts are best for those small business owners who want unlimited transactions and can maintain a $2,000 average monthly balance.
Introductory Offers and FeesThe Spark Business Savings account offers a promotional Annual Percentage Yield of 1.75% for the first year. This applies to up to $1 million in savings balances for business owners. After $1 million there will be a non-promotional APY applied. After the first year of banking through the Spark Business promotion, the rate will lower to .40%, earning interest at Capital One’s standard rate. The promotion is limited to one account per business. Capital One considers itself to be a lower fee bank. Here are some of the fees that you might incur as a business checking account customer:
- Monthly Service Fee: $15 if your business checking account does not maintain a $2,000 minimum balance
- No transaction fees or ATMs fees at all 39,000 Allpoint ATMs
- Free Cash Deposits up to $5,000 and $1 for every $1,000 after that
- Incoming Wire Fee: $15
- Outgoing Wire Fee (Domestic): $25
- Outgoing Wire Fee (Foreign): $40
- Spark Business Checking customers can order business checkbooks for $30 each with each additional checkbook costing $22.
Capital One NetworkCapital One Network is smaller as far as physical locations are concerned. They only have 700 branches nationwide and are not located in many states. They are partnered with Allpoint to provide customers with more fee-free ATM access with over 39,000 ATMs in the U.S. Capital One relies heavily on their web portal and mobile banking app to give customers the 24/7 support and service they require. Most if not all account issues can be resolved on the website or over the phone.
- Merchant Services
- Accept credit card payments worldwide powered by Worldpay
- Use smart terminals, traditional terminals, or mobile readers
- Transparent reporting and multiple payment method friendly
- Accept all major credit, gift and loyalty cards
- Spark Credit Cards
- Spark cash back rewards or Spark miles rewards credit cards for businesses that travel
- The cash back card has 2% cash back and $500 cash bonus opportunity
- The miles rewards card offers 2x the miles reward and a 50,000 bonus miles opportunity
- Custom plans designed for small businesses
- Spark 401K support for business owners and employees
- Low-expense Exchange Traded Fund options
Who This Account Is Best ForThis business checking account is best for those small businesses with less than 200 transactions monthly.
Introductory Offers and FeesThere are no special offers at this time for Citizens Bank‘s business checking accounts. Citizens Bank’s fees are competitive with other business checking account fees and the free Clearly Better Business Checking account is a plus. Here are some of the fees you might encounter banking with Citizens Bank:
- $20-25 Maintenance fee for non-Clearly Better Business Checking accounts that don’t meet monthly requirements
- Transaction fee: $.30-.50 per additional transaction over monthly limit
- Domestic Incoming Wire Transfer: $18 – $31
- Foreign Incoming Wire Transfer: $10 – $12
- Domestic Outgoing Wire Transfer: $18 – $30
- Foreign Outgoing Wire Transfer: $8 – $35
- Interbank Wire Transfer: $5
- No cash deposit fee
- Overdraft Fee: $39 per item, $6.99 per day for each day overdrawn up to $69.90
- Out-of-Network ATM Fee: $3.00
Citizens Bank NetworkThe Citizens Bank Network expands across 11 states in the following regions: Northeast, Mid-Atlantic, and Midwest. It is a small bank network when compared with financial giants like Bank of America or Citigroup. However, they do have 1,150 physical locations and 3,300 ATMs. Citizens Bank is originally a Rhode Island based bank, but now it offers services nationwide to over 5 million customers.
Special FeaturesThe Citizens Bank business checking accounts have money management features that are standard to most basic checking accounts and then have payment solutions, eBill autopay, and overdraft solutions beyond the norm.
- Citizens Bank Mobile Deposit
- Citizens Bank has an award-winning mobile app that allows businesses to deposit checks right from their smartphones.
- Online Bill Pay
- Pay bills easily online with an integrated calendar tool to help pay bills as early as possible.
- Account Management Tools
- Track payments, bills, funds, and view all accounts at once with multiple user account access with added security.
- Send bills to vendors and suppliers with autopay and alert systems.
- Money Movement and Management
- Popmoney is Citizens Bank’s online payment service that offers account-to-account transfers and cash flow management tools.
- Brand invoices with custom business logos
- Transfer funds across accounts.
- Overdraft Line of Credit
- Overdraft Credit links your checking account to an overdraft specific credit line that auto transfers funds to cover ATM fees, debit card purchases, and bill payments that go beyond the available balance.
- Savings Overdraft Transfer
- Overdraft Savings links your checking account to an overdraft specific savings account that auto transfers funds to cover ATM fees, debit card purchases, and bill payments that go beyond the available balance.
Who This Account Is Best ForThis business checking account is best for a small business that has a high number of monthly transactions.
Introductory Offers and FeesNew Business checking accounts can earn a cash bonus reward by opening an account.
- $100-300 for Business Checking account if you sign up by September 14th, 2018 and maintain a minimum average per cycle of $1,500-$25,000 for the first 3 statement cycles and make 10 total PNC Bank Visa Debit Card transactions or mobile check deposits in that same time frame.
- Deposit PNC merchant services card payment proceeds into your business checking account
- Make > $1,000 worth of purchasing using your linked PNC business credit card
- Have an average monthly balance of $1,500
- Monthly fee: $12
- Transaction fee: $0.50 per transaction after the first 150 transactions each month
- Cash deposit fee: > $5000 a fee applies and $3 per deposit bag for night processing
- ATM fee: 6,000 PNC Bank ATMs nationwide and an out-of-network ATM reimburse plan if you carry a $2,000+ daily balance
- Domestic incoming wires: $15
- Domestic outgoing wires: $30
- International incoming wires: $15
- International outgoing wires: $45
PNC Bank NetworkPNC is the 9th largest bank in the US, and its network spans 2,800 banking locations in 19 different states with over 6,000 PNC ATMs. It’s network’s downside is the lack of physical locations, but with so many ATMs and ATM reimbursement programs if you are a business looking to either primarily online-bank or are located near a PNC bank, the network could accommodate your needs.
- No Setup Fee for Overdraft Protection
- Get overdraft protection on your business checking account without an initial fee
- No Charge for 150-1,500 Items
- Depending on account size you can you can have free transfers, deposits, and transactions for up to 1,500 items monthly
- Cash Flow Insight Base
- The Cash Flow feature is a suite of online tools for cash management like spending analysis, timelines, trends, cash in, and cash out to help you make more informed business decisions. The cost for this feature is an added $10 monthly.
- Great for managing account payables and receivables online with the ability to sync accounting software and receive forecast credit card statements.
- Invoicing and document management reminders and templates for improved management.
- PNC Merchant Services for next-day funding on payment processing
- Online bill pay and banking
Who This Account Is Best ForU.S. Bank is best for newer, smaller businesses or businesses with moderate cash flow and transactions.
Introductory Offers and FeesU.S. Bank gives its business checking customers a special 50 percent discount on their first check order up to $50 even if you wait months to order the checks. If you go to sign up at a branch you can get a discounted price on a mobile card reader and get it for just $49 or a full terminal for $399. This is only when you sign up for its clear and simple pricing program. U.S. Banks offers a competitive fee schedule when compared with other top banks for business checking account customers. Here are some of the fees you might encounter while banking at U.S. Bank:
- Monthly Maintenance fee: No monthly maintenance fee for US Bank silver business checking, all other monthly fees vary see above section for details.
- Transaction fee: $0.50 cents per transaction after the first 150 transactions limit is reached each month
- Cash deposit fee: The first $2,500 in cash deposits are free every month
- ATM fee: No out-of-network additional charge nationwide and access to 3,200 ATMs that have free withdrawals in addition to 25,000 more MoneyPass ATMs.
- Domestic incoming wire transfer fee: $20
- Domestic outgoing wire transfer fee: $30
- International incoming wire transfer fee: $25
- International outgoing wire transfer fee: $50
U.S. Bank NetworkThe U.S. Bank network is in the top five biggest banks in America. It has 3,200 physical branch locations and 5,000 ATMs where you can receive free financial services. Using the branch locator on the web portal or mobile app you can find the nearest branch or feeless ATM. U.S. Bank has
- ADP Payroll
- U.S. Bank partners with ADP® to deliver flexible payroll, tax, and human resource solutions for companies of all sizes.
- Customer Check Risk Management
- Offer customers the option of paying by check while cutting costs and associated fraud risk. With Electronic Check Services, checks are auto-converted into electronic transactions.
- Remote Check Deposit Solutions
- Deposit checks with your U.S. Bank mobile app, the Deposit Express, or with on-site bank location electronic deposits with only a $15,000 per day limit on mobile check deposit.
- Business Reserve Line
- Get overdraft protection with a revolving line of credit up to $5,000 for advanced overdraft prevention.
- Card Payment Processing
- Point-of-Sales solutions, mobile card payments, online/remote card payments, check and card processing, and international card payments for businesses.
- Business Money Market Accounts
- Earn higher interest rates and watch your balance increase, giving you unlimited access to your funds while getting extra cash.
Who This Account Is Best ForThis business checking account is best for micro businesses or small businesses looking for an entirely free mobile and online banking solution.
Introductory Offers and FeesSmall Business Bank offers a free business checking account geared towards micro businesses. There are no limits, monthly fees, or minimum balances when you get a micro business checking account at Small Business Bank. This isn’t so much a promotion or offer, it is how their business checking is designed. Small Business Bank is a low-fee, micro business checking option that has the most competitive fee schedule of any online bank for very small businesses. Here are some of the fees you might encounter when banking with Small Business Bank:
- Money Orders: Free
- Cashier’s Check Fee: Free
- Dormant Account Fee: $2 per month
- Return on Deposited Item: $2
- Domestic Incoming Wire Transfer Fee: $15
- Stop Payment Fee: $25
- Insufficient Funds/Overdraft Fee: $25
- Mailed Statements: $10 per month
Small Business Bank NetworkSmall Business Bank used to be called Gardner Bank and is a member of the Federal Reserve system. It started as a Kansas headquartered bank serving the city since 1984. Despite having its roots in Kansas, now Lenexa, Kansas specifically, the bank now services small businesses in all 50 states across the nation. The customer support team is not 24/7, but they are ready to assist with financial needs during business hours. Small Business Bank is part of the Shazam ATM network and no fees apply at those ATMs for Small Business Bank account holders.
Special FeaturesThere are very few special features and now cash flow management solutions at Small Business Bank. Here are the basic features that do come standard with the Micro Business Checking Account:
- Free online banking and bill pay
- Free mobile deposits using the easy-to-use Small Business Bank mobile app
- Free ATM withdrawals at any Shazam ATM location
- A free FDIC-insured account
- High Yield Business Savings Account with 0.49% APY on funds up to $100,000 and 0.99% for any over $100,000