Best business bank accounts
July 13, 2020
Now that you have decided to move forward with a business bank account, the next question you might ask yourself is "which should I go for?"
This really depends on the nature of your business and what you might need to do with it. Are you simply looking to separate your business income and expenditure? Do you deal with a large number of cash and cheques and therefore need an account that will allow you to process these with minimal fees? Is it important that your account integrates with your bookkeeping software?
Most business bank accounts offer a charge free period (usually 12 to 18 months) and then usually move to a fixed monthly fee. This typically lies around £5-£10 per month, but some charge more and others less. Some banks will also charge extra fees based on the type of transaction e.g. additional charges for paying in cash or cheques. Therefore it is important to check the terms and fees past any initial "free period".
In addition to fees, you will also need to consider the type of institution your account is held with. In addition to regular high street and online banks, there has been an increase in the offerings from electronic money (or e-money) institutions. The key difference between these institutions is that only banks are authorised to accept customer deposits and therefore lend, make investments and therefore pay interest from these funds. E-money institutions must safeguard funds which are received from you, but protection is not provided under the Financial Services Compensation Scheme. It is therefore important to know what type of provider is offering the account to ensure you are comfortable with the level of protection it offers.
Read on to view our top pick of everyday business accounts...
Zero monthly fee
List of Services
-
StarlingList Item 3
- No monthly or annual fees
- No fees for overseas spending
- £3 charge on cheques up to £1,000 then 0.3%
- No pysical branches - account operated online or via the app
- Instant payment alerts as mony enters or leaves your account
- Funds are protected by FSCS
-
MettleList Item 1
- No monthly, annual or transaction fees
- Suitable fo sole traders and limited companies with up to 2 owners.
- No physical branches - account operated entirely though Mettle app
- Max £50k balance for sole traders and £100k for limited companies
- Includes free FreeAgent bookkeeping software
- Note: funds are not protected by FSCS
-
CoconutList Item 2
- No monthly or annual fees
- Free bank transfer and £1 charged per cash withdrawal/deposit
- No physical branches - account operated entirely though Coconut app
- Includes free bookeeping software provided by Coconut
- Note: funds are not protected by FSCS
High Street Banks For all accounts listed below, funds are protected by the FSCS up to £85,000
List of Services
-
Santander 123 AccountList Item 3
- £5/m for start-ups for 18m and switchers for 12m then £12.50/m
- Up to £300 cashback per year
- Interest on your credit balance
- No charge and unlimited ATM cash deposits
- Access online, at Santander branch counters, ATMs and Post Office branches
- Also offer a standard current account which is free for start-ups for 18m then £7.50m
-
MetroList Item 1
- Monthly fee of £5/m for balances under £5,000 otherwise free
- Transaction fees from £0.30 each, with 50 free per month for balances over £5,000
- Access online, via app, in branch and over the phone
- Metro Bank branches are open 7 days a week, 362 days a year
-
BarclaysList Item 2
- Free for start-ups for 12m then from £6/m.
- Two price plans, designed for the way your busienss makes & receives payments (Mixed Payments Plan & e-Payments Plan)
- Price Plan Guarantee to ensure you are always on the plan that offers the best deal
- Loyalty Reward of between 5% and 50% based on annual credit turnover and length of time account held
Note: Prices/terms correct as of 13 July 2020.
The information in the post is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by Bo&Co Ltd and is not intended to be relied upon by users in making (or refraining from making) any investment decisions.
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