*Disclaimer: We are not affiliated with any of the linked banks/companies nor do we receive any type of affiliate compensation. We are also not financial professionals, please consult with one if you have any questions or concerns.
When it comes to starting a business, entrepreneurs have all sorts of questions. How do I create a business plan? What is the tax rate for my industry? And how do I open a bank account for my business? These are all important questions to answer before you start your business. A good banking relationship can help you save money and collect the funds you need to grow your company. However, not all banks are created equal. Some work better for personal banking while others specialize in banking for small and medium-sized businesses. From checking accounts to credit cards and loans, here are some of our favorite accounts for solo businesses.
Business banking or commercial banking is a division within a bank that offers services tailored to running a business. This division provides business loans, credit, savings accounts, and checking accounts for businesses, not individuals. Some of the other services that fall under this division include processing payroll, paying quarterly taxes, or general financial planning.
A bank that primarily serves individuals is known as a retail bank while banks that deal with capital markets are known as investment banks. You’ll also find banks that have clients spanning both categories.
Before we dive into the top bank accounts for solo business owners, let’s answer an essential question: what’s the upside to banking with a bank that specializes in commercial banking? Business banking supports your business by streamlining your day-to-day financial tasks–– the tasks that are essential to keeping your business running smoothly and efficiently.
As you grow your business, banking with a commercial bank will make it easier for you to borrow money. You’ll also have an assigned banking representative who is in charge of helping you select the best services and solutions that your business is facing. For example, if you need help outsourcing payroll or managing invoices, these are aspects of owning a business that a business bank can assist with.
At a quick glance, here are some other advantages of commercial banking:
Are you a personal trainer looking into banking with a commercial bank? Check out our article, Do I Need a Business Bank Account for My Personal Training Business?
If you’re looking for a business checking account that doesn’t require a ton of fees, Novo is a great option. With easy to configure tech integrations, discounts with popular invoicing, marketing, and communication tools, and the ability to sync your account with Google Pay and Apple Pay, it’s a fairly intuitive and savvy option.
The major con to Novo is that it doesn’t offer any physical locations, so tasks like depositing cash can prove to be difficult. If you’re concerned that you might be over drafting frequently, be mindful that Novo does charge a $27 overdraft fee.
Chase Business Complete Banking ℠ has a fair amount of perks that are especially appealing for solo business owners. You can have unlimited electronic deposits and 100 transactions per month for no additional cost. Unlike online-only banks, Chase has thousands of ATMs and branches, so you can choose between online and in-person banking.
For all of the convenience that Chase provides, it has some serious drawbacks in terms of bank fees. There is a $15 per month bank fee that can only be eliminated if you:
Lili was specifically designed for the unique needs of solo businesses. Your online checking account also automatically comes with a Visa business debit card, and you have access to over 38,000 ATMs. Lili also provides these services without fees, and you won’t have a minimum balance or opening deposit requirements. One of the most appealing aspects of Lili is that it gives you free access to tools that help you keep track of your spending, budgeting, and tax reporting.
If your solo business is on the brink of becoming a medium or large-size business, Lili is not the best option for you, as it won’t have all of the capabilities you’ll need for a larger scale business.
AXOS is an online bank that specializes in simple online banking. On the positive side, AXOS has a good amount of consumer and business banking products. Their basic business checking account has no monthly maintenance fees, but it does require a $1,000 minimum to open one.
While it’s free to use, AXOS does have higher requirements than other banks, and since it’s an online bank there are no physical locations.
Lending Club Tailored Business Checking is designed specifically for small business owners, with the goal of helping you earn money. Plus, Lending Club has unlimited penalty-free transactions and unlimited 1% cashback on debit card purchases. If you open any other checking or savings accounts, you’ll also earn internet on them. Need to add employees to your bank account? This option allows for that, so you can have employees make their own deposits and use their own debit cards if they need to make business purchases.
The downside of this option is that it requires fairly high daily balance requirements. If you can’t afford to have $5,000 in your account, you’ll have to pay a monthly fee.
Live Oak Business Bank’s mission is to create incredible banking experiences for small business owners. It requires no minimum opening balance or deposit for savings accounts. Plus, they award 0.50% APY for business savings accounts.
If you prefer to conduct your banking online (from your device or the web), Live Oak Bank might be a great option for you and your business savings account. Other benefits include zero monthly maintenance fees and your interest is compounded daily.
The main drawback of Live Oak is that they only permit up to six transactions per billing cycle. If you exceed that amount, you’ll be charged a $10 fee per transaction.
At a high level, one of the key benefits of a Capital One Business Advantage Savings account is the flexibility it provides for business owners with digital banking options. With this account, you won’t experience any surprise fees, monthly fees, or minimum balances.
Keep in mind that withdrawals are limited to six per month. If you prefer in-person banking, you’re limited to locations in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and the District of Columbia.
For small business owners and entrepreneurs, Chase Business Total Savings is a great option for a traditional business savings account. Benefit from mobile banking, security alerts, and access to thousands of ATM locations. If you go over six withdrawals per cycle, Chase also has a low withdrawal fee.
Note that Chase does have a $10 monthly service fee if you do not carry a minimum amount of $1,000 in your account or if you end up linking your savings account to a Chase business checking account. It’s also important to keep in mind that this account does not have impressive interest rates, so if you’re looking to earn a lot of interest, this option might not be the best one for you.
Some of Axos Bank Business Premium Savings account’s top benefits include an above-average APY, no monthly fees, and the ability to deposit checks remotely using your mobile device.
If you’re looking for a bank with in-person banking options, Axos is strictly a mobile bank, so you won’t be able to deposit money at a physical location. This option also requires a fairly high minimum balance of $25,000 to earn 0.20% APY.
Opening a savings account with First Internet is fairly easy, with a required amount of $100. There is also no minimum balance to deposit. Another pro of this option is that you can make unlimited deposits each month, plus six withdrawals and transfers per month are allowed without any additional charges.
Keep in mind that with First Internet you must maintain an average daily balance of $1,000. If you don’t maintain this, you’ll be responsible for a $2 monthly maintenance fee.
There are a lot of credit cards out there, but not all of them are well suited for small businesses and solo entrepreneurs. Here are a few of our favorite credit cards for solo business owners:
As an entrepreneur growing your business, you might need to borrow money to get your business off the ground. Unfortunately, it can be difficult for entrepreneurs to secure loans from traditional banks. However, you have other options. Here are a few different options to look into if you’re hoping to secure a loan:
Researching business checking and savings accounts, credit cards, and loan options can feel overwhelming because there are so many to choose from. But as a solo business owner, keeping your finances in order is key to your success. As your business grows, knowing your options and, most importantly, knowing which options are best for your business, will save you time and money in the long run.