When running a business, one of the most important tasks is managing finances. This involvesnot only keeping track of expenses and income but also selecting the right bank account tomanage your funds. Choosing the right business bank account can help you save money, streamline financial operations, and ensure that your business is operating efficiently.
There are several types of business bank accounts available, each with its own unique featuresand benefits. Here are the most common types of business bank accounts:
Current Accounts: This is the most popular type of business bank account. It enablesbusinesses to deposit and withdraw money, pay bills, and receive payments. Some currentaccounts also offer overdraft facilities, which can be useful for businesses that need short-termfunding.
Savings Accounts: These accounts are ideal for businesses that want to save money and earninterest on their savings. Savings accountstypically offer higher interest rates than current accounts, making them a good option for businesses that have extra funds they don’t needaccess to immediately.
Foreign Currency Accounts: These accounts are designed for businesses that conducttransactions in foreign currencies. They allow businesses to hold funds in different currenciesand make payments in those currencies. Foreign currency accounts can help businesses avoidcurrency exchange fees and reduce the risk of currency fluctuations.
MerchantAccounts: These accounts are specifically designed for businesses that accept cardpayments from customers. They allow businesses to process payments securely and efficiently.Merchant accounts typically charge a fee for each transaction, but they can be agood option forbusinesses that conduct a high volume of card transactions.
Selecting the right business bank account is crucial for several reasons:
Cost Savings: The right business bank account can help you save money on fees and charges.For example, if you frequently conduct international transactions, a foreign currency accountcan help you avoid currency exchange fees.
Efficiency: A well-chosen business bank account can help streamline your financial operations.For instance, if you accept card payments from customers, a merchant account can help youprocess payments quickly and securely.
Access To Financing: Some business bank accounts offer overdraft facilities, which can provideshort-term funding when needed. This can be a valuable resource for businesses that needquick access to funds.
Choosing the right business bank account requires careful consideration of your business needsand financial goals. Here are some factors to consider when selecting a business bank account:
Fees And Charges: Look for a bank account with low fees and charges that fit your budget.Consider the fees for transactions, monthly account maintenance, and overdrafts.
Interest Rates: If you plan to keep a lot of money in your account, look for an account withcompetitive interest rates. Compare interest rates acrossdifferent accounts to find the bestoption.
Online Banking: Consider the bank’s online banking features, such as the ability to check yourbalance and make transfers online. Look for a bank with a user-friendly online platform thatmeets your business’s needs.
Customer Service: Choose a bank with excellent customer service, so you can get help whenyou need it. Look for a bank with 24/7 customer support, an online chat, or a dedicated accountmanager.
Businesses that are classified as high risk, such as those in the gambling or adultindustries, may face difficulties in finding a suitable bank account. High risk businessesare often perceived as having a higher probability of fraud or chargebacks, which canmake banks hesitant to offer them accounts. However, there are still options availablefor high risk businesses. Some banks offer specialised high risk business bankaccounts that cater to their unique needs. These accounts typically come with higher feesand stricter regulations, but they offer businesses the opportunity to manage theirfinances more efficiently and reduce the risk of fraud or chargebacks. It’s important forhigh risk businesses to do their research and compare the options available to them tofind the best bank account for their needs.
Sometimes, businesses may find that their applications for business bank accounts aredeclined. This can happen for a variety of reasons, such as poor credit history, high riskindustries, or insufficient documentation. If your application is declined, it’s importantnot to panic. There are still alternatives available that can help you manage yourfinances effectively. One option is to look for alternative providers, such as online banksor specialised financial institutions that offer business banking services. Theseproviders may have different eligibility requirements and may be more willing to workwith businesses that have been declined by traditional banks. It’s also important to workon improving your credit score and financial standing, as this canincrease your chancesof being approved for a business bank account in the future.
In some cases, businesses may have their bank accounts terminated, which can cause significant disruption to their financial operations. This can happen if the business has violated the bank’s terms and conditions or engaged in suspicious or fraudulent activity. If your business bank account is terminated, it’s important to act quickly to find an alternative. One option is to approach other banks or financial institutions and explain the situation. Be honest and transparent about what has led to the termination of your previous account and provide any relevant documentation or evidence to support your case. Alternatively, you may consider alternative financial products, such as prepaid cards or e-wallets, which can provide many of the same features as a traditional business bank account. However, it’s important to weigh the benefits and drawbacks of each option and choose the one that best meets your business needs.
Businesses with offshore directors may face additional challenges when it comes to finding suitable business banking. Offshore directors are individuals who reside in a different country than where the business is registered. This can create difficulties in terms of identity verification and compliance with local banking regulations. In some cases, banks may be hesitant to offer business bank accounts to companies with offshore directors due to increased risks of fraud or money laundering. However, there are still options available for these businesses. One solution is to work with a specialised financial institution that has experience in dealing with offshore companies and directors. These institutions can provide tailored solutions that address the unique needs and challenges of offshore businesses. It’s important for businesses with offshore directors to do their research and find a banking partner that can provide the necessary support and expertise to help them manage their finances effectively.
Switching business bank accounts may seem like a daunting task, but it can actually offer a range of benefits for your business. Firstly, it can provide an opportunity to review your current banking arrangements and identify any areas for improvement. This can help you to streamline your financial operations, reduce costs and improve efficiency. Secondly, switching to a different bank can provide access to a wider range of financial products and services that may better suit your business needs. This can include more flexible lending options, improved online banking functionality or better customer service. Finally, switching business bank accounts can also provide an opportunity to take advantage of introductory offers and incentives, such as fee waivers or cashback rewards. Overall, switching business bank accounts can help you to improve your financial management and ensure that your banking arrangements are better aligned with your business objectives.
In conclusion, choosing the right business bank account is a critical part of managing your finances effectively. By considering your business needs and financial goals, you can select a bank account that helps you save money.
Libby and the team at Merchant Advice Service are absolutely first class in every way. We have a furniture business and were let down by our existing payment processing company at a critical time for our business and without warning….
Libby helped us find a merchant account when i was having trouble finding one for myself. I would highly recommend using Merchnat Advice Service.
Superb service from Libby James. Forever my go to place for Merchant advice
Libby is very professional in her approach and simply a go getter. She understands clients needs accurately and goes for the bull eye. I am really happy with her services and would always recommend her for any of your payment…
We reached out to Merchant Advice Service when seeking a new payment partner, after multiple failed applications due to the sector we are in. Libby was super-helpful, very clear and supportive and we achieved a successful outcome. Top marks and…
Libby was a great help when we needed to set up a new merchant account. We were up and running very quickly. Highly recommended.
I was initially skeptical about the idea of a merchant advice service but was pleasantly surprised that I have not been bombarded with marketing and junk mail. I was contacted in a very professional manner which lead to a successful…
The team worked hard to get our approval. COVID makes everything harder for everyone. And Merchant Advice Service persisted and gave the correct advice. Thank you PJ Brennan
Very quick to respond and helped us find a provider for euro credit card payments from customers. First class service.
I contacted Merchant Advice Service because I needed an expedited merchant account due to issues with our ongoing provider. After talking to many merchant account operators, it was becoming apparent that this was not possible. I contacted Libby in the…
We were struggling to get anywhere with finding merchant services for our business. I came across them and sent a message. I received quick, professional responses throughout and that has resulted in us getting sorted out.
Great service, quick and professional responce. Libby and her team got our payment processing sorted where others failed. Highly recommended