Opening a business bank account provides liability protection and will make your life easier come tax season. But not all bank accounts are created equal. Here are seven things to consider when choosing a business bank account.
[Read more: Small Business vs. Personal Bank Accounts: Understanding the Difference]
Location
You should consider the bank's location and how important that will be to you. Are you looking for a bank with a lot of branch locations you can visit? Is it important that you have access to an extensive ATM network?
Or would an online bank be sufficient? An online bank typically has low fees, better interest rates, and mobile access.
But there are no physical locations you can visit, and customer support will be given online or over the phone. So, if you’re looking for more personal service, in-person banking will be a better fit.
The fees
Most bank accounts come with a number of fees, including monthly maintenance fees, overdraft fees, and wire transfer fees. These fees can seem unnecessary to most customers, but they’re used to help the bank pay for its branch locations, customer support, and other bank services you enjoy.
You can avoid many of these fees by opening an online business bank account, like one offered by Kabbage or BlueVine. But this may not be a good option if you prefer an in-person banking experience.
If you find a bank you like that charges fees, ask them if there’s a way to waive the fees. For instance, some banks offer overdraft protection or give you a way to avoid monthly maintenance fees.
[Read more: How to Protect Your Business Bank Account From Theft]
Minimum balance requirements
Some banks require that you deposit a minimum amount of money when opening the account. They may also require you to maintain a minimum balance every month; and if you don’t, you’ll have to pay a low monthly fee.
For instance, you may need to maintain an average balance of $5,000 throughout the month or pay a $20 fee. You should find out what the minimum balance requirements are and consider whether they’re realistic for you.
If your checking account is used primarily for cash flow, maintaining a certain balance may not be realistic. Fortunately, many banks are willing to forgo these requirements.
If you plan on opening a business savings account, you might look for a high-yield savings account. Finding a bank with the best possible rates will allow you to earn a little money as your savings grow.
Introductory offers
Occasionally, banks will offer introductory offers to incentivize new customers to open an account. For instance, if you open a new business checking account through Chase bank, you could earn a one-time $300 bonus.
These offers can be a nice perk for opening your business bank account. Just make sure you read the fine print to ensure you meet the requirements.
Account features
Does the bank you’re considering offer any additional features that make it worthwhile? For instance, can you manage your account through the bank’s mobile app, and are there bill pay features?
And if you’re in the early stages of building your business, you might see if your bank is willing to extend you a line of credit. It’s always a good idea to have access to credit before you need it, and you may find better terms through a bank you already have a relationship with.
[Read more: Banks vs. Credit Unions: What’s the Difference?]
Interest rates
If you plan on opening a business savings account, you might look for a high-yield savings account. Finding a bank with the best possible rates will allow you to earn a little money as your savings grow.
You’ll likely find the best interest rates through an online bank. For instance, Axos Bank and Capital One offer high-interest savings accounts with low monthly fees.
Integrations
You’ll likely use your business bank account in combination with a number of other business tools. For instance, you might use QuickBooks to send invoices and track your expenses. So, you want to look for a bank account that will integrate with the features you use every day.
Before signing up for a bank account, find out what that bank’s capabilities are and whether it syncs with your current accounting software. Accessing the right integrations will help you streamline your business finances.
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