Whether you’re a sole trader with no plans of growing beyond that or a small limited company with big plans on growing your team, it’s important to find a business bank account that offers features that are suited to your needs.
If you‘re worried about a bad credit history affecting your chances of being approved for a business bank account, look for providers that offer guaranteed business bank accounts without conducting a credit check. These banks are usually online-based and are becoming increasingly popular.
Perhaps it’s important for you to have a credit or a debit card. Perhaps a cheque book would make your business life easier. Or maybe you require a bank account that allows international payments without charging you extortionate fees.
It’s also wise to look at the overdraft facilities that come with any bank accounts you’re considering. Even if you don’t need it now, access to an overdraft can bring peace of mind as your expenses mount.
Knowing you have a buffer to play with in case you run into any problems with your cash flow can be helpful but beware of your limits. Go over your overdraft (i.e. into an ‘unplanned overdraft’) and you could face big charges. Stick with a ‘planned overdraft’ and talk to any potential providers about your options here before you really need the cash.
When you begin to compare business bank account options, consider what’s essential and what would be ‘nice to have’.
It would also be a good idea to consider the availability and cost of business loans and lending when choosing your business bank account, as you may want to expand your business in the future. Again, just like with the overdraft scenario, talking to a prospective bank about your business loan options while times are good and you don’t need the borrowed cash can save you a lot of time and hassle when you do.
Don’t forget the human touch
There’s no denying it; your bank account is pretty essential to your business. The wrong provider could mean a lot of stress and hassle.
With this in mind, don’t forget to think about the human factor and make sure you’re happy with the level of support and advice offered by your bank.
Some business bank accounts come with a business advisor who you can contact in branch, on the phone or via the internet. Other banks have UK call centres with trained business advisors.
Understand what level of support you might need and look for a bank that can accommodate you.
Checklist: How to choose the best business bank account
- Consider which features are important to you.
- Make sure you’re aware of all the fees and charges.
- Think about whether you’ll need a credit card, a debit card, a chequebook, or all three.
- Find out whether the bank account will allow international payments.
- Does it have an overdraft facility, and if so, are you eligible? Do you even need an overdraft?
- If you have a bad credit history, consider online bank accounts.
- Think about the future of your business. Do you have plans to expand your business? Which banks offer business loans and lending schemes that help start-ups?
- Will you need support or regular communication with your bank? If so, look for a bank that provides business advisors or a support hub.