Choosing a Business Bank Account. The Basics

If you are looking for a replica headlight for a 1950 Chevrolet you may find your options are limited. However, if you are looking for a business bank account there are an abundance of options available to you. Different accounts can benefit you in different ways and several questions are raised when deciding what is best for you. Do you need a cheque book? What type of transactions will you have? Should you opt for a bank or a building society? This post will answer some of the key questions and allow you to make an informed decision when choosing an account.

The cost of an account

The cost of an account will undoubtedly be at the forefront of the decision making process and, fortunately, most banks offer between 12 and 24 months of free banking. This can be advantageous to new and existing companies alike, nevertheless it is imperative to be aware of, and account for, the costs associated with the account following this period.  

This ‘honeymoon’ period is an incentive for you to choose a particular bank and experience their service. Ideally, any costs associated with the account following this point will be compensated by the level of service you receive. Should you find the costs of the service are unreasonable based upon your experience with the service then you are well within your remit to change provider.  

Please note that free business banking is typically offered for the first account only. If you opt to have more than one account we recommend checking what additional fees will be levied.  

How do different transaction types affect you?

E-commerce orientated companies may find most of their transactions are electronic whereas a local retailer may deal predominantly in cash. The nature of your company’s transactions can influence which type of account is most suitable.

Cash intensive businesses may find a local branch is of the utmost importance. In contrast, if your transactions are primarily online and you regularly provide services to international clients the foreign currency facilities available may be of greater use.  

Banking Facilities

At a basic level your account should allow you to deposit and withdraw funds, albeit there are an array of banking facilities available to you. Overdrafts and online banking are just some of the tools that could be invaluable to your business.  Before making a decision check with facilities are offered. 

Switching accounts is always an option and comparing your account against others on a regular basis will ensure you are getting what’s best for your company.

Banks are suppliers like any other, consider the costs and service implications and make the best decision for your company based on as much knowledge as possible.

Please see our website for more information on the bank referrals we can offer.