Choosing a financial institution
Before you open your business bank account, you may want to compare what’s offered by the banks and credit unions in your area and by online banks to determine what financial institution and products are right for you and your business.
Checking and savings accounts
As with personal accounts, a business can open a business checking account and savings account. The checking account can be for receiving payments and covering operational expenses (i.e., everyday expenses, like buying supplies or paying employees). The savings account can be for long-term savings and projects. Even small businesses that don’t have a lot of money to spare can slowly start building a business emergency fund to help them get through tough times. Keeping your savings in a separate account could make it easier to resist using the money for day-to-day expenses. Plus, savings accounts tend to offer a higher interest rate than checking accounts, which can help you earn more money with your savings.
Comparing your options
Even if the company you use for your personal banking also offers business accounts, you may want to look around to see if it’s actually the best fit for your business. Once you compare your options, you might find that a different financial institution will actually work better. Some of the things you could compare as you’re looking at different accounts are monthly transaction limits or requirements, fees, features, interest rates, and access to your account.
Online and mobile banking
Many banks offer online banking capabilities and a smartphone app for mobile banking. Once you create an online account, you may be able to easily check your balance, initiate bank-to-bank transfers and pay bills at any time. Using online banking can also be important for keeping accurate banking records. Many online accounting and payroll systems can be linked to online bank accounts, allowing you to easily share information back and forth. Having all your systems connected could make managing your business’s finances and taxes easier. There are also online-only business bank accounts, which may be worth considering as an alternative to a branch-based account.