Should I Open An Online Business Bank Account?
Establishing a business bank account is one of the first steps to legitimizing an entrepreneur’s financial credibility. Since business banking should offer solutions to help a business grow, it’s best to find a bank that will meet the unique needs of a business. For many entrepreneurs–especially startups–online business bank accounts offer a low-cost and convenient alternative to traditional brick and mortar banks. While traditional banks provide the convenience of tellers and easy accessibility, business accounts typically carry minimum balances as well as monthly and transaction fees. And for a business startup,these fees can make it hard to keep expenses low.
Not to mention, digital banks often easily integrate with other online tools such as Quickbooks, Square, Stripe and PayPal, making it even easier for a busy entrepreneur to manage their finances effectively.
Read This: 6 Ways to Improve Your Business Cash Flow
Whether you are a solopreneur or a small business with a payroll and a storefront, deciding to open a online business banking account may suit your needs perfectly.
What monthly fees are associated with having a business bank account?
Many brick and mortar banks charge monthly fees for business accounts. While some may waive monthly fees if you are able to keep a minimum balance, others may not. However, many online banks offer free or low-cost fees to establish a business account. Citizen’s Bank, for instance offers no fees or minimum opening deposit for entrepreneurs with low to moderate activity.
What type of business do you run?
Choose a business bank account based on the structure of your business. If you run an e-commerce site and do not accept cash, opening an online business account such as Azlo is advantageous. The digital bank offers no balance requirements and does not charge maintenance or overdraft fees. Not having financial requirements traditionally associated with a business account can be a relief for a struggling startup.
However, if your business requires multiple cash deposits daily, a brick and mortar bank might meet the needs of your business better.
What banking products does your business need?
If you are in business you need a business checking and savings account. But that’s not all. If you truly want to grow your business, you will need to be able to accept more than cash from customers, which means you’ll need access to merchant services. And if you want to save money for emergencies, you will need to open a long-term savings account such as a Business CD. Digital banks such as First Internet Bank provides several of the business solutions mentioned.
Want to purchase new equipment? You will need business financing. Digital banks such as Grasshopper Bank specialize in taking the hassle out of long loan processes. The company streamlines the lending process, making it easy for established businesses and startups to have access to funds quickly and efficiently.
Can you manage a mobile app for banking purposes?
Many entrepreneurs love online bank accounts because they can easily access their information through their phone or other devices. Digital banks such as Novo make it easy to make deposits and transfer money to different accounts with ease.
Online business bank accounts are an easy and low-cost way for entrepreneurs to manage their business’ cashflow. Although nothing can ever replace the bank teller’s smile or that lollipop that is free at your local bank, digital banks offer something more: lower fees and peace of mind.