In a nutshell
If you own a small business or are considering starting one, you’ll need to use a bank or another financial system (like a neobank) to conduct online and in-person transactions.
- A small business bank account allows small business owners the ability to conduct financial transactions to operate and maintain their business legally.
- The best small business account offers low monthly fees and a competitive APY.
Our top recommendations
| Bank | Best for | APY* | Fees |
|---|---|---|---|
|
Axos
|
No monthly fees
|
N/A
|
$10 (can be waived)
|
|
Chase
|
Bank branch access
|
0.01%
|
$15, $30 or $95 (can be waived)
|
|
Lili
|
No overdraft fees
|
4.15% on savings account
|
$0, $9, $21 or $33
|
|
Live Oak Bank
|
Business savings accounts
|
Not disclosed
|
$10, $25 or $100 (can be waived)
|
|
Grasshopper
|
Record keeping
|
2.25%
|
$0
|
|
American Express
|
Business credit cards
|
1.30%
|
$0
|
|
Capital One
|
Unlimited transactions
|
1.00% to 4.10%
|
$15
|
|
U.S. Bank
|
Signup bonus
|
Not disclosed
|
$0 to $36
|
* Paid on interest checking/saving
Best small business bank accounts
Axos: Best for no monthly fees
AXOS BASIC BUSINESS CHECKING
PROS:
- No monthly fees or minimum deposits.
- Automatic refunds of all domestic ATM fees.
CONS:
- Foreign transaction fees.
- No integration with popular third-party apps.
Axos offers business savings and checking accounts with little to no fees for new and established businesses. You also get unlimited transactions, free inbound domestic wire transfers and unlimited domestic ATM fee reimbursements, which comes in handy if you frequently need cash. On the flip side, you can also make cash deposits at Allpoint and MoneyPass ATMs fee-free, which makes up for the fact that Axos doesn’t have branches that can take cash deposits.
New customers can earn up to $400 for maintaining a $50,000 daily balance on new business checking accounts opened before June 30, 2024, which is a nice bonus. Unfortunately, the Axos Business app in the Apple App store only gets 1.5 stars and in Google Play it gets 2.2 stars. Evidently, the folks who designed Axos’s regular banking app did a much better job.
Chase Bank: Best for local branch access
CHASE BUSINESS COMPLETE BANKING
PROS:
- Excellent customer service ratings.
- Nationwide access to brick-and-mortar locations for in-person banking preferences.
CONS:
- Lots of fees unless minimum requirements are kept.
If you like talking with your banker, Chase might be the best option for a business banking account. With 4,800 locations nationwide, you’re sure to find a branch near your location, and their excellent J.D. Power customer service ratings mean you’ll be treated with friendly service.
Chase is the public facing business of J.P. Morgan Chase and Co., which is the largest bank by market capitalization in the U.S. That means there are a lot of resources available to their customers, though you may not get the specialized attention you might receive from a smaller bank.
Lili: Best for no overdraft fees
LILI
PROS:
- No hidden fees.
- Connect securely to existing external accounting platform.
CONS:
- Available only within the continental U.S.
- No cash deposit option.
Lili is a neobank for small businesses that are digitally savvy and don’t do a lot of transactions in cash or checks. The Lili business checking account comes with a Visa debit card, which is accepted at most vendors and protected against unauthorized charges. Lili also offers small businesses a platform for banking services, accounting, invoicing and tax preparation. Business banking accounts come in four tiers. The first, basic tier is free, but the top three tiers that have the best features range from $15 to $55 per month.
Checking services are low or no cost in many categories like ACH fees, ATM fees, foreign transaction fees and incoming domestic wire transfers, and if most of your transactions are online, Lili’s zero-dollar minimum balance makes it a good, low-cost option ideal for owner operators and sole proprietors in information-based businesses. For cash-based businesses, however, the difficulty in processing lots of cash transactions may require a different approach.
Live Oak Bank: Best for insuring your deposits
LIVE OAK BANK BUSINESS SAVINGS
PROS:
- Business checking customers have free access to more than 55,000 ATMs.
- Above national average APY on business savings accounts. (No monthly fee and no minimum balance required.)
CONS:
- No cash deposits.
- No weekend customer support.
Live Oak Bank is similar to other online banks on this list in that it has no branch locations and you will probably conduct most of your transactions online through ACH transfers. Live Oak’s business checking has no monthly fees, excess transaction fees or overdraft fees, and the business savings accounts compound interest daily to give you the best return on your savings with a higher-than-national average APY. The key feature of a Live Oak business banking account is its cash sweep feature that allows you to insure more of your cash deposits than the usual $250,000 limit allowed by the FDIC for single accounts.
Checking accounts come in three tiers that cost $10, $25 and $100 per month. You can waive the monthly fee in the first two tiers by keeping a minimum deposit ($1,000 and $25,000 respectively), and you can connect your account with Quickbooks, one of the most popular bookkeeping software packages. Unfortunately, you can’t deposit cash without paying a fee, making this a poor choice for cash-intensive businesses.
Grasshopper: Best for business account record-keeping
GRASSHOPPER
PROS:
- No overdraft charges or monthly fees.
- Business record-keeping.
- Earn unlimited cashback with certain accounts.
CONS:
- Can’t deposit cash.
- Requires $100 to open an account.
Grasshopper business checking account holders can earn 1% cash back and 2.25% APY on deposits. That interest rate jumps to 3.75% APY when you add an Innovator Money Market Savings account. You also receive a free Visa debit card for transactions.
The key differentiator for Grasshopper is its digital invoicing and payment technology and its add-on bookkeeping software called Autobooks. This provides automated bookkeeping and reporting, cash flow management and a dashboard to keep track of expenses.
American Express: Best for business credit cards
AMERICAN EXPRESS BANKING
PROS:
- Well-known for its name and customer service.
- No monthly fees or minimum deposits.
CONS:
- Doesn’t offer cash deposits.
American Express is well-known for its excellent customer service and top-tier business credit cards. With qualifying terms, customers can earn up to 1.30% on balances up to $500,000 and have unlimited fee-free monthly transactions.
As a big, well-established financial services company, American Express doesn’t skimp on services. Unlike some other banks on our list, American Express offers 24/7 customer service and they tout talking to “real, live people” on their website. (Actual experiences may vary.)
U.S. Bank: Best for the signup bonus
U.S. BANK BUSINESS CHECKING
PROS:
- Silver Business Checking account has no monthly service fee.
- No transaction fees at U.S. Bank ATMs (13,000 ATMs nationwide).
CONS:
- Limited free transactions per month.
- Limited free cash deposits per month.
We love the option of free checking and the availability of U.S. Bank ATMs nationwide, where you can get cash whenever you need it without incurring a transaction fee. With over 2,000 locations nationwide, it is a good option for those who like in-person banking.
New U.S. Bank business account customers can also get a bonus up to $800 if they meet specified account requirements (for $800 the requirement is depositing at least $25,000 in your account within 30 days of opening and keeping that as a minimum balance for another 60 days).
Capital One Bank: Best for unlimited digital transactions
CAPITAL ONE BUSINESS CHECKING
PROS:
- Unlimited free transactions.
- Free withdrawals at over 70,000 ATMs.
CONS:
- Must apply in person and only available in eight states (East Coast and Washington D.C.).
- Checking account options have a monthly fee.
If you use your business checking account frequently, Capital One should be at the top of your list when selecting a business account banking partner because they offer unlimited digital checking account transactions, which include mobile deposits, ACH payments and online bill pay. You can also get free ATM withdrawals at over 70,000 locations nationwide.
Capital One has both brick-and-mortar and online banking capabilities, but in some cases, you may have to visit a physical branch to finish opening your account. (They say, “If you need to come into a branch to complete the account opening process, we will let you know.”) This may be a blocker for some small businesses.
How we chose the best business bank account
We compared checking accounts based on the following criteria: APY, minimum deposit, minimum balance and fees. We also took the minimum number of transactions per month (if any), accessibility (like the number of branches or ATMs) and whether the bank is insured into our analysis for greater nuance.
Ultimately, we looked for checking accounts that offer the most value to customers.
Choosing a bank for a small business account: Where to begin
Choosing the right bank for your small business is often the next step after starting a business. Many small business owners choose the same bank where their accounts are, and that’s often a good idea if you like one-on-one service and nearby locations. However, it’s worth looking into other options, like online banking because many online banks offer larger rewards and benefits to attract new customers.
Here are a few things to consider when choosing a bank for your small business banking needs.
- Fees: As a new business owner, keeping expenses low while you grow your business makes sense. Look for a banking partner that keeps monthly fees low and doesn’t charge a fee for cash deposits or multiple transactions.
- APY: Recently, banks have been more willing to pay depositors to keep their money in an account. A decent APY lets you get extra earnings from your profits.
- Accessibility: Whether visiting a branch in person or using an online app, you want to be able to access your money easily.
- Introductory offers: Some banks offer membership rewards points or a cash-back bonus if you deposit and keep a required amount in your account for a specific time.
- Minimum account balances: Won’t charge a fee if you go below a minimum amount.
As a small business owner, it’s up to you to pick the best bank for your small business needs.
Types of business accounts
The type of business account your business chooses to process financial transactions with can vary by business type. Typically, small business owners will have two business accounts: a checking account to process everyday transactions and a savings account to earn interest on excess cash.
- Business checking account: For everyday transactions like bill-pay.
- Business savings account: Earns interest on deposits saved for other uses.
- Business certificates of deposits: Earn higher APYs, but untouchable without penalties, if needed before term expiration.
- Business money market accounts: Offer higher APYs and also come with debit and credit cards.
Requirements to open a business account at a bank
Here’s a list of the documents and other requirements needed to open a business checking or savings account at a local bank or online financial institution.
- EIN or Social Security Number.
- Your business formation documents.
- A business license.
- Current banking information.
- Personal information like your name, address and ID, like a driver’s license, to help verify your identity.
It’s important to remember that having all the forms you need before applying for a business bank account is always a good idea to avoid delays and other problems that could impact the approval process.
Frequently asked questions (FAQs)
What type of bank account should I open for my small business?
The type of bank account you’ll want to open for a small business is similar to the reasons you use when opening a personal bank account. You’ll want to select a bank with low monthly fees that lets you earn interest on the money you’ve deposited. Another feature small business owners look for when choosing business bank accounts is the option to have a credit or debit card to make transactions easier.
Also, if you prefer to conduct your business in person, check out local banks and credit unions that offer business accounts rather than choosing an online option.
What kind of bank account should I open as an LLC?
An LLC, also known as a Limited Liability Corporation, is often the first step when taking a hobby or small business to the next level. The LLC means your business was formed as an entity for legal and tax purposes, and according to law, all financial transactions should be kept separate from personal accounts.
Accordingly, an LLC business bank account must be kept separate from personal bank accounts to conduct financial transactions legally.
Do I need an EIN to open a bank account for an LLC?
You’ll need an EIN to open a business bank account for an LLC unless you operate as a single-member LLC or sole proprietor. The EIN is a number provided by the IRS to pay taxes for your small business. If you are a sole proprietor or single-member LLC, you have the option to use your social security number to report tax information to the IRS.
Can I open a bank account with an EIN only?
Opening a business bank account with only an EIN is possible, but it may take a lot of work to do so with traditional financial institutions. Many traditional banks and online financial institutions require additional information to verify your identity to open bank accounts, like a driver’s license or passport.
However, new companies called neobanks, which are financial technology companies that provide business banking and lending services through partner banks, may approve a business bank with just an EIN and other supporting documentation.
Can you be denied a business bank account?
Financial institutions are under no obligation to approve your application for a business bank account. Some issues that can hinder the approval process include low credit scores, your bank can’t verify your information and incomplete paperwork.
Is it hard to get approved for a business bank account?
Getting approved for a small business account is relatively easy if you have good credit. Choose a bank that meets your needs, fill out the paperwork and get started. If you have a lower credit score, you may not get approved by some banks and will have to shop around for a bank that approves those with low credit scores.
Should you have accounts at multiple business banks?
It makes sense to have more than one business bank account if you have a lot of cash or are scared of keeping all your eggs in one basket. The FDIC only insures cash deposits up to $250,000, so if your bank account grows over that amount, you’ll want multiple accounts in case of bank failure or other such calamities.