When you start a small business, one decision you need to make early on is selecting a business bank account. Business accounts often provide benefits and incentives that can help with a small business’s day-to-day operations.
Different Accounts for Different Types of Businesses
There are many business bank accounts that differ based on the type of business. For example, there are different accounts depending on if you are a sole trader, an established small business, or a start-up just getting off the ground.
For example, if you are a sole proprietor who has been in business for three months and you rely on your personal bank account for your business cash flow, that is generally fine (though you need to exercise oversight and diligence in keeping track of business-related deposits and expenses). If your revenue is relatively low because you do not have a large client base (yet), you should look for a business bank account offering incentives such as free banking for a year, 0% interest for a period of time, etc.
Keep in mind that many bank accounts typically only offer a free banking period for start-up businesses that apply within the first 12 months of being established.
Other Benefits to Consider When Choosing Bank Accounts
Below is a list of consider benefits and incentives you should consider when shopping for the best business bank account.
- Overdraft fees and how much
- Charges related to paying into your bank account, making withdrawals, and/or transferring funds
- Customer support for any account-related issues (both on-call and live chat support)
Reputation and Culture of the Bank
In addition to the above-described incentives, the selection of a business bank account may come down to more than just the account features, but also the reputation and culture of the banking institution.
The bank you select may appear to be better on paper because they could provide a reasonable interest rate and/or no-fee ATM withdrawals. However, you may need to do business with a bank featuring a culture that responds to customer queries and issues in a timely manner. There are also ethical implications to consider. There are in fact, banks that operate under the precept of “ethical banking provider.” These are institutions where deposits are invested in ways that make a difference in some way. It could be anything from supporting environmentally-friendly developments within a community, to helping invest in alternative energy start-up initiatives. It is also important to remember that a bank marketing itself as “ethical” does not mean that it will somehow offer less money relative to other more high-profile banks. These ethical banks will still be able to provide you with the services your business needs.
Whatever you are looking for in a business bank account, weighing the positives and negatives of each and doing your due diligence is important.
Contact an Orlando Small Business Attorney Today
If you need assistance with small business issues, the Chidolue Law Firm is here to help. Our firm serves small businesses in and around Orlando, Florida and is ready to help you navigate business laws and regulations. Contact our office today at 407-995-6567 to schedule a meeting.