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Effective cash management is critical to small business success. The problem is that it can be difficult to find an adequate business bank account these days, as a confluence of unique market dynamics have resulted in business-branded accounts finding their way to the bottom of the banking totem pole. As a result, personal accounts – especially online checking accounts – are often preferable for small business owners.
Business accounts still have their virtues, though. Like business credit cards, business checking and savings accounts tend to offer certain features geared specifically to the needs of corporations. Having a business checking account, whether you supplement it with a personal account or not, also simplifies tax preparation and affords you certain legal protections.
In order to help you find the best accounts for your needs, WalletHub compared nearly 200 business bank accounts as well as 450 personal accounts and identified not only the best overall bank accounts for business in 2015, but also those with the highest interest rates, the best rewards and the lowest fees. You can find our picks below.
We chose this account because it offers the strong combination of a 0.76% interest rate (assuming you make 10 debit transactions a month and enroll in electronic billing) on balances up to $50,000 and 0.36% thereafter, a low monthly fee of $10 which can be avoided by getting both a Lake City credit card and merchant services account, and no fees for your first 150 account transactions per month.
(Membership Required) If you live, work, worship or attend school in Suffolk County, NY you qualify for membership in the Bethpage Federal Credit Union and can therefore take advantage of this account’s $0 monthly fee, lack of a deposit limit (most relevant for cash-based businesses), unlimited free transactions, and a 0.4% APY on all balances.
Many small business owners are able to leverage a personal bank account for business purposes, and this particular personal checking account offers the highest APY on the market: up to1.25% , provided you meet some easily attainable usage requirements. It does not charge a monthly fee either, which means it can easily be used to supplement a business-branded account.
If you’d rather not mix business and personal finances, the Lake City Bank Business Rewards Checking account listed above has the highest APY among business-branded accounts.
This account is a good option for entrepreneurs and small business owners who are just getting started, as it offers a very high APY – 1.5% – but only on balances up to $10,000. You get just 0.5% on amounts above that. There is no monthly fee and you only need $1 to open an account.
With no monthly fee as long as you maintain a $1,000 minimum balance ($8 otherwise), this account doesn’t have to take money from you. It does, however, give a bit back. Account holders get points equivalent to as much as 0.56% cash back on their debit card purchases. Of course, if you’re looking to maximize your rewards on everyday spending, credit cards offer far superior terms. Some of the best business credit cards offer a full 2% cash back on all transactions.
(Membership Required) If you live, work, worship or study in certain areas of Texas, Colorado or Utah you may qualify for membership in the Security Service Federal Credit Union, allowing you to take advantage of the fact that the Premier Business Checking Account offers points equivalent to 0.5% cash back on debit card transactions. This account has a $5 monthly fee and enrollment in the reward program is $2 per month.
While this account won’t provide any interest, it’s a great option for small business owners who are just getting started, as it does not have a monthly fee, ATM fees or fees for online bill pay.
Another great option for small business owners, as it also does not have a monthly fee, ATM fees or fees for online bill pay, reimburses ATM surcharge fees while not charging a fee for foreign transactions. There is a $2 fee for paper statement, however.
What a lot of small business owners may not realize is that banks charge extra for a high volume of transactions or cash deposits. This won’t come into play for most companies, but it’s important for cash businesses to find accounts that have high limits and low over-limit costs. This account offers 150 free transactions and charges only 30 cents for each subsequent transaction that you make. It also has a $10,000 monthly deposit limit and charges only 10 cents for every $100 that you deposit in excess of that amount. There is, however, a $12.50 monthly fee that can be waived by maintaining a $1,000 minimum daily balance or combined deposits and loans of $15,000.
You get 200 free transactions with this account, and the fee for subsequent transactions is 50 cents. It has a $10,000 monthly deposit limit and charges 10 cents per $100 in excess deposits. There is a $15 monthly fee which can be waived with a $2500 average balance.