Compare the best business bank accounts

Picking the right business bank account can take lots of time, energy and effort. So, we decided to do the hard work for you. Here's our ultimate guide to the best available in the UK – plus everything you need to know about how they work.

By Sooraj Shah on 30/08/2019

Business bank account | hero image
Image: Andrew Neel

So you’ve started your own business, what’s next? Well, aside from letting HMRC know about your business, and registering it with them, you should apply for a business bank account. This will help you keep your business finances separate from the money in your personal current account, track your cash flow effectively and plan for the the future.

To help you decide which banking service to go for, we've compared all of the major providers – from the high street banks to the online newcomers – and highlighted their key features.

So, to help make your decision pain free, here’s everything you need to know about opening a business bank account, plus a handy comparison of the top UK accounts for 2019.

To find the best business bank account providers in the UK, please skip to Part 2.

Getting set upGeneral information
What is a business bank account?Do I need a business bank account for a small business?
What do you need to open a business bank account?How to choose a business bank account
What is the best bank for a small business account?What type of business bank account is right for a small business
Can I use my personal bank account for my small business?Managing your business account cash flow

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What is a business bank account?

To understand whether or not you need a business bank account, it’s worth setting the facts straight about what a business bank is and how it differs to a personal bank account.

Firstly, there's a misconception that it is a legal requirement to open a business bank account for a limited company. That being said, it is a legal requirement to separate your personal finances from your limited company, as the business is a distinct legal entity.

Besides this, opening a specialist business banking account would make your life – as well as that of your accountant’s – much easier. It not only enables you to more effectively track all business income and expenses, it allows you to look more professional to clients, which encourages trust and repeat business.

The bank account for your company needs to be in the name of your business, and banks will realise if you’re attempting to set up a personal account in the name of a limited company and force you to switch to a business account, which comes with its own terms and conditions.

Most business accounts will charge you a monthly fee to use. These are usually fairly low, but accounts with more tools and features may cost more, so it's a good idea to understand what you're paying for up front. You'll usually be able to get several debit cards with the account, to enable you and any staff the ability to use the card. Many business accounts also now have their own dedicated app, which can help you track spending, pay bills and generally manage your money. Some business accounts even offer insurance and support in the case of fraudulent activity.

What do you need to open a business bank account?

Opening a business bank account in the UK is a pretty simple process – if you make sure you've got all the documents in one place before you apply. You'll likely need some, if not all, of the following:

A proof of your ID It's possible to use one of three official documents. Your driver's license photo card, your passport, or an official ID card.

A proof of your address For this you can use things like a gas or electricity bill, a council tax bill or a statement from your personal bank account.

Information about your business:

  • The full name of the company
  • The business' postal address
  • The main phone number and email address
  • The business' Companies House registration number
  • An approximate yearly revenue

Before the bank sets you up with your account and sends you out your debit cards, you may be asked to supply some details about your personal accounts and credit score. This is help the banking provider know more about how you use money, and will help them gauge how you might manage your business banking.

What is the best bank for a small business account?

It's impossible to say which best bank offers the best small business account, as every business is unique and the services offered by each provider varies widely. However, in the section below we've tried to help you decide by comparing the products and services offered by each of the business accounts.

Can I use my personal bank account for my small business?

As above, whether you can choose to use a personal bank account for your business depends on the type of business you run or own. Limited (ltd) companies legally need a seperate account, which should be a specific business account if possible. This is because the company is deemed to be a legally distinct and separate from you. If you're a sole trader then you're under no obligation to set up independent accounts. That said, it is a good idea to have one current account for personal banking and one for the business. This will help you keep your business cashflow apart from your own.

Do I need a business bank account for a small business?

As above, you do not legally need to have a business bank account if you're a sole trader – but it is a good idea. If you run a limited company then yes, you do need a specific business bank account, with separate cards and statements.

How to choose a business bank account

One of things most business owners look for in a business banking service is lower costs – and many banks offer day-to-day banking for the first 12 to 18 months without charging any fees. However, there are still likely to be certain transaction fees, and once the honeymoon period is over transaction fees can increase significantly. So, it’s worth checking how much these fees will cost your business in the long-term. You can also switch to a new account once the fees start to stack up.

One way of calculating the long-terms costs of your bank account is by analysing how you usually pay for expenses and how you usually get paid. Some accounts have different tariffs which better accommodate cash or cheque transactions, while some services better support who receive and make payments online. There are even banks which focus on offering lower transaction fees for making and receiving payment abroad.

Another consideration for your business is how much you rely on or prefer to use mobile apps, in-branch support, or telephone and online services. Many businesses owners would be happy to use online methods only if the mobile-app worked well – so it’s worth reading reviews on apps and how they integrate to other services, including contactless cards, support methods, pensions, accounting software, invoicing and more.

It’s also worth factoring in how your business could benefit from the business account even further: does it offer free tools or guides, and can you earn cashback on your purchases or interest on your balance?

For those worried about credit checks, there are accounts that don’t do them – although these providers will do other types of checks on identity. Meanwhile, while some of the challenger providers may have some great functionality with their mobile apps but your money may not be protected by the FSCS if they were to go bust.

What type of business bank account is right for a small business

Small businesses all have different needs, but for those enterprises or sole traders just starting up, there will be a need for accounts offering lower fees – even if this is just for a set period of service.

After that, there may be a need for banking tools that can help manage the business – accounting software, pensions, receipts and smart invoicing can help to increase your efficiency and be less reliant on others.

Managing your business account cash flow

If you’d like to find out how a credit facility or business loan could help you manage the cash flow of your business bank account, why not get in touch using the contact details above? Alternatively, you can click the blue Intercom button on the bottom right of your screen. To find out more about the best business banking providers in the UK, keep reading.

From baristas to barristers – business bank accounts for all

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The top 25 business bank accounts

Use the table below to navigate, or simply scroll down to discover the top 25 business bank accounts in the UK.

Best business bank accounts A-HBest business bank accounts L-Z
Allied Irish BankLloyds Bank
AnnaMetro Bank
Bank of Ireland UKNatWest
Bank of ScotlandRevolut
BarclaysRoyal Bank of Scotland
Card One BankingSantander
CashplusStarling Bank
Clydesdale BankThe Co-operative Bank
CoconutTide
Counting UpTSB
Fair EverywhereUlster Bank
HandelsbankenYorkshire Bank
HSBC

Every care has been taken to provide accurate info on each business bank account provider. They are ranked in alphabetic order. All facts and stats are correct (according to the bank account providers' websites) as of 1st September 2019.

Allied Irish Bank

Monthly Fees: £10 per quarter

Other fees:

  • Electronic payment fee: 35p each
  • Cash payments: 35p each
  • Cheques (in or out): 70p per cheque at Post Office, 30p on cheques in other banks

Main features:

  • Flexible access with Internet Business Banking service
  • Pay cash over the counter ar Allied’s business centres, Post Offices or other banks
  • Additional services such as credit cards, savings accounts and loans available
  • Overdraft facility available
  • Focus on industries such as hotels, manufacturing, healthcare, hotels and hospitality and professional practices
  • Business centres located in large cities and towns across the UK – it is worth checking if there is one near you if you require in-branch banking

Allied Irish Bank, or AIB, positions itself as relationship-driven bank for medium and large businesses, such as hotels, small restaurant chains and hotels. Its monthly and transaction costs are fairly low but there's no mention of a fee-free period at sign up.

Anna

Monthly fees: Free for three months, then £5 for sole traders, £5 for limited companies with a turnover of £2,000. £11 per month for limited companies with a turnover over £2,000.

If you don’t use your account, as a limited company or sole trader the monthly fee is waived.

Other fees: No extra fees for UK ATM withdrawals, transfers or card payments.

Main features:

  • Tailored towards freelancers, creatives and small businesses that see a fluctuating income
  • Unlimited invoice creating and chasing
  • Tax reminders
  • Same day set up
  • Free for three months for either sole traders or limited companies
  • Personalised reports
  • 24/7 UK based support

ANNA stands for Absolutely No Nonsense Admin. As the name suggests, the company positions itself as platform to help sole traders and limited companies with time-consuming administrative tasks, such as chasing invoices. It also provides those with a fluctuating income the ability to pay nothing if they have not used its services for a month. ANNA is not a bank and therefore does not have in-branch services of any kind.

Bank of Ireland UK

Monthly fees:
£25 per quarter

Other fees:

  • Electronic payment fee: Free
  • Cash payments: £1.40 per £100
  • Cheques Issued: £0.95 each

Main features:

  • Business overdraft, dependent on business performance
  • A choice of two current account options
  • Online banking, mobile banking and telephone banking
  • Use of Post Office counter facilities

Bank of Ireland is part of the wider Bank of Ireland Group. It provides business banking services to businesses based in Ireland. However, UK users can access the bank’s services through the Bank of Ireland UK.

Bank of Scotland

Monthly fees: 18 months free for new businesses, and then £6.50 thereafter

Other fees:

  • Electronic payment fee: Free
  • Cash payments: 18 months free for new businesses, then first £1,500 per month at £1 per £100. Anything over £1,500 per month at £0.80 per £100
  • Cheques (in or out): 18 months free and then £0.65

Main features

  • 18 months free business banking for new businesses
  • Simple pricing and free electronic payments
  • Mobile business banking app
  • Available for businesses with an anticipated turnover of up to £3m
  • UK-based business management team support
  • Access to Business KnowledgeBox: guides and reports to support businesses

The Bank of Scotland is part of the wider Lloyds Banking Group and it offers 18 months free business day-to-day banking for new businesses, as well as free electronic payments, simple pricing and business support through phone, in branch or through online guides. The bank also offers prospective customers an account calculator to work out how much it would cost to bank with them.

The bank received a 54% service quality score in the Competition and Markets Authority’s 2019 report into business bank accounts.

Barclays

Mixed Payment Plan monthly fees: £6 a month

Other fees:

  • Electronic payment fee: £0.35 per transaction
  • Cash payments: £0.90 per £100
  • Cheques (in or out): £0.65

ePayments Plan monthly fees: £6.50 a month

Other fees: Electronic payment fee: Free Cash payments: £1.50 per £100 Cheques (in or out): £1.50 per transaction

Main features:

  • Two types of price plans to choose from
  • Review of your price plan every year to ensure you are on the best deal
  • Loyalty rewards – payback of charges depending on how long you’ve been a customer
  • Suitable for most businesses that have a turnover of up to £6.5m
  • Calculate potential fees using online calculator

Barclays offers its business customers two types of price plans for its accounts, one is for businesses that use cash, cheques and a range of other transaction methods, while the other is for those businesses that mainly receive electronic payments and make payments through online banking and debit cards.

Customers can change plan whenever they like, and they will be rewarded with a percentage of their charges paid back to them depending on how long they bank with Barclays, and their annual credit turnover. This can range from 5% for businesses with annual credit turnover of up to £99,999 who have been with the bank for 1 to 5 years, to 50% for those who have been with the bank for over 15 years and have an annual credit turnover of more than £2 million.

Card One Banking

Monthly fee: Minimum of £12.50, plus one-off application fee of £55 which is refundable if not approved, under terms and conditions

Other fees: Electronic payment fee: £0.30 each Cash or cheque credit: 0.75%, minimum of £0.50

Main features:

  • No credit checks needed to apply
  • Can open an account within four hours
  • Regulated by the FCA but not a bank – money not protected by FSCCS
  • Only for businesses with a maximum £2 million turnover a year
  • Pay in cash and cheques at Barclays Bank branches
  • Pay in cash at the Post Office
  • Bill payment service allows Card One Banking to make sure payments are set up
  • Free text alerts and check balance online and via text

Card One's Business Account is designed specifically for small businesses. The online-only current account is easy to use and can be secured even if the business owner has a less than perfect credit history.

Cashplus

Monthly fee: £5.75 a month, or £69 annually

Other fees:

  • Electronic payments and transfers: First three free, and then £0.99 each thereafter
  • Paying in with cash at UK Post Offices: Free up to £1,000 per month
  • Paying in by bank transfer: Free
  • UK ATM withdrawals: £2

Main features:

  • No credit check required
  • Accountancy software integrations
  • Five-minute online application process
  • Manage account online or through the mobile app
  • Pay in and withdraw cash at any UK Post Office

Cashplus is another banking services provider that's not actually a bank. Mainly accessed through its online app, users can add on pre-approved credit products to get their cash-flow moving, or track expenses asd they happen.

Clydesdale Bank

Monthly fees: 25 months free for new businesses or those switching to the bank, otherwise £6.50

Other fees:

  • Electronic payment fee: 2.75% of transaction value, minimum £1.50 (after free period)
  • Cash payments: 65p per £100 (after free period)
  • Cheques (in or out): Manual entry check is 70p, cheques remitted 30p per cheque (after free period)

Main features:

  • 25 free day-to-day banking for new business customers with a turnover under £2m who switch to Clydesdale, and to start-ups who open a business current account within their first 12 months of trading
  • Choice of two accounts: Business Current Account and Business Choice Account
  • Unlimited deposits and withdrawals, subject to available funds
  • Optional overdraft
  • Tailored accounts available for charities and professional firms

Clydesdale offers two types of accounts, the first is for either those established small businesses that want to switch bank providers, or those start-ups that have been trading for less than 12 months. The Business Current Account offers free day-to-day banking for 25 months. The second account is the Business Choice Account which has a credit interest linked to the Bank of England base rate, an option of an agreed overdraft and personal attention from a business banking contact.

Coconut

Monthly fees: Free options for side businesses, or sole traders starting up and £5 per month excluding VAT for full-time businesses and full-time sole traders who opt for the Grow plan

Other fees:

  • Cash withdrawals: £1
  • All Post Office deposits: £1 per deposit (five free per month for those paying for the Grow plan)

Main features:

  • A mixture of a bank account and accounting software
  • Aimed at freelancers, self-employed and small businesses
  • Not protected by FSCS meaning your money won’t be covered if they go bust
  • Smart invoicing, receipt capturing and bookkeeping
  • Real-time tax estimates and reports on the grow plan
  • Expense tracking
  • Mastercard Debit card

Coconut is a financial tool that's aimed freelancers, small business directors and the self-employed that seeks to make managing finances – particularly tax returns, expenses, documenting paid and unpaid invoices, and tracking expenses – easier using smart tech interfaces. Low fees and two business account options (Start and Grow), make Coconut attractive for smaller enterprises looking to capitalise on its wide range of services.

Counting up

Monthly fees: Free for starters (£750 of incoming funds per month), £2.95 for standard account holders (£750-£1,750 incoming funds per month) and £4.95 for premium account holders (more than £1,750 of incoming funds per month).

Other fees:

  • Cash payments via Post Office: £1
  • Bank transfers in/out: £0.20
  • Cash payments in via Paypoint: 3%

Main features:

  • An account tailored towards small businesses and freelancers
  • Open an account in minutes
  • Automated bookkeeping
  • Professional invoices
  • Receipt Capture
  • Tax filing
  • Profit/loss reports
  • There is a maximum account balance for self employed (£50,000) and limited companies (£120,000)
  • Deposit cash into your account in any Post Office or PayPoint location

Like Coconut, Counting Up seeks to attract customers by consolidating small business owners' banking and accounting needs into one service. Aimed at making things as simple and jargon free as possible, Counting Up may be a good option for those new to running a business. There are three tiers of membership, from free to £9.95 a month. Users access their accounts mainly through the Counting Up app and online portal.

Fair Everywhere

Monthly fees: £50

Other fees:

  • Currency conversion fee: 0.5%
  • International payment: 1.5% of transaction value
  • International ATM currency conversion: 1.5% of transaction value
  • Lost/stolen card replacement: £5
  • Statement copy: £5
  • Admin letter: £5
  • Account balance redemption: £10

Main features:

  • Low foreign exchange rates with access to three currency wallets: EUR, USD, GBP
  • Multi-currency current account
  • 8% cashback rewards from 50 UK high street retailers
  • Customer support Monday to Saturday
  • Free direct debits and standing orders
  • New customers can sign up to join the waiting list, with the company’s offering coming soon for everyone
  • Limit of £100,000 to send and receive per month in total

Fair Everywhere is a good option for small and medium-sized businesses that buy and sell in foreign markets. Its platform lets users make and receive payments all over the world in local currencies and at competitive rates. Fair Everywhere is another relative newcomer, with a service that's mainly accessed online on through its app, however its support team are available to phone during business hours.

Business banking for busy people

Handelsbanken

Monthly fees: NA

Other fees:

  • Electronic payment fee: NA
  • Cash payments: NA
  • Cheques (in or out): NA

Main features

  • Top service quality score (85%) in CMA’s 2019 independent report of business bank providers
  • Top in CMA report for SME overdraft and loan service, relationship/account management and in-branch service
  • 200 UK branches
  • Mobile app for Android and Apple

Handelsbanken is a Swedish bank which has been operating in the UK for nearly four decades. Its website is not clear around its banking service pricing, but customers of the bank are clearly pleased. In 2019, Handelsbanken received top scores for customer service and satisfaction, according to the independent Competition and Markets Authority report into 14 business banks.

HSBC

Monthly fees: 12 months free then £5.50

Other fees:

  • Electronic payment fee: Free, unless on Small Business Tariff (£0.19 per credit)
  • Cash payments: Up to £3,000 free thereafter 0.50% of the value deposited
  • Cheques (in or out): £0.30 or £0.40 per cheque depending on tariff (after free period)

Main features:

  • 12 month free banking for new customers, 18 months free for start-ups
  • £5.50 charge thereafter
  • 12 months ‘fixed price’ after the free banking period ends, where £3000 cash per month can be deposited for free, otherwise £0.50 per £100 cash deposited. No other standard account charges
  • After fixed period ends, customers can choose from Small Business Tariff or Electronic Banking Tariff depending on type of transactions used - £5.50 per month fee remains
  • Free 12 months British Cycling Fan Membership available to business current account customers

HSBC offers a tiered banking structure, which is more complicated than many other banks. However, its lengthy free period means that the first two years will largely entail zero transaction fees.

Lloyds Bank

Monthly fees: 18 months free for new businesses, and then £6.50 thereafter

Other fees:

  • Electronic payment fee: Free
  • Cash payments: 18 months free for new businesses and then first £1,500 per month at £1 per £100; Anything over £1,500 per month at £0.80 per £100
  • Cheques (in or out): 18 months free and then £0.65

Main features:

  • 18 months free business banking for new businesses
  • Simple pricing and free electronic payments
  • Mobile business banking app
  • Sole traders, partners or company directors can qualify for this account
  • UK-based business management team support
  • Guides and tools for running your business
  • Online bank account cost calculator

Lloyds Banking Group provides different business accounts depending on the turnover of the business customer. There are three categories: £0-£3m turnover, £3m-£25m turnover and £25m+ turnover. The company’s bank account was ranked fourth of 14 business bank providers in an independent survey conducted by the Competition and Markets Authority which asked customers if they would recommend their provider to other small and medium enterprise (SMEs), with 61% stating they would. The company’s accounts are for both new and existing businesses. New businesses get 18 months of banking free, while businesses that switch from another bank provider get six months free.

Metro Bank

Monthly fees: Zero if balance is over £5,000, otherwise £5

Other fees:

  • Electronic payment fee: 50 free transactions per month if balance is over £5,000, otherwise £0.30 each
  • Cash payments: 0.50% regardless of account balance
  • Cheques (in or out): 50 free transactions per month, thereafter £0.30 each

Main features:

  • 24/7 customer support team
  • Open 7 days a week
  • If balance stays above £5,000 for the whole month, the monthly account fee is waived
  • No appointments required in branches
  • Local business managers to helps support your business

Metro Bank has faced criticism after miscalculating the risk level of some of its commercial loans by £1bn. However, the UK challenger bank’s customers are still satisfied with the service they’re receiving. Metro had the highest number of business customers satisfied with services in branches and business services (77%), according to the Competitions and Markets Authority’s independent survey in August 2019.

NatWest

Monthly fees: Free for start-ups for 18 months, then £5 per month if transaction charges are less than £5

Other fees:

  • Electronic payment fee: Free, and then £0.35 per item
  • Cash payments: Free for 18 months and then £0.70 per £100
  • Cheques (in or out): Free and then £0.70 per manual payment item

Main features

  • Award winning mobile app where you can view both business and personal accounts in one place
  • Free accounting software (FreeAgent), discount on DHL Express and free receipt management tool
  • 24/7 online banking tool
  • Dedicated business planning team
  • Free for 18 months for start-ups

High street giant NetWest comes with free accounting software and a discount on DHL Express delivery, which could prove attractive for some business ownera. It's app and online portal are backed up by dedicated business planning assistance, to help users map out their enterprise's journey. With 18-months free for new businesses, there's plenty to like with NatWest's package.

Revolut

Monthly fees:

  • £0 for a free account
  • £25 for the grow account
  • £100 for the scale account
  • £1,000 for the enterprise account
  • There are also free and professional (£7 per month) accounts for freelancers

Other fees:

  • Local transfers: Five free on the free business account, thereafter £0.2 per transfer. 100 free with Grow, 1,000 with Scale.
  • International transfers: £3 per transfer for free users, 10 free international transfers for Grow users and then £3 thereafter

Main features:

  • Hold and exchange 28 currencies including GBP, EUR and USD without the same premium bank charges
  • Local accounts in GBP and EUR, and multicurrency cards
  • Virtual cards to manage payments for Amazon, Google and Facebook ads
  • Prepaid business cards
  • No cash or cheque deposits as it is online only
  • Mobile app

Revolut is a flexible option for business owners across Europe. It's likely to be particularly useful for businesses with operations that span multiple countries, as it lets users hold, send, and receive funds in up to 28 currencies. There are several account options – including Freelancer or Company – each tailored for a different scale of business. The more expensive generally come with more free transactions per month and with the ability to issue additional cards among employees.

Royal Bank of Scotland

Monthly fees: Free for start-ups for 24 months, then £5 per month if transaction charges are less than £5

Other fees:

  • Electronic payment fee: Free for 18 months and then £0.35 per item
  • Cash payments: Free for 18 months and then £0.70 per £100
  • Cheques (in or out): Free for 18 months and then £0.70 per manual payment item

Main features:

  • Free for 24 months for start-ups with a turnover of less than £1m
  • 24/7 online banking tool
  • Free accounting software (FreeAgent) and discount on DHL Express
  • Dedicated business planning team
  • Other options available for businesses with turnovers up to £2m (commercial current account)

The RBS business accounts offer a solid package, with a Visa debit card, a lengthly free period and added extras, such as free accounting software from FreeAgent and a 60% discount on deliveries using DHL Express. Business owners can do their banking online through the RBS app or over the phone with 24/7 help.

Santander

Monthly fees: Free for start-ups for 18 months, then £7,50

Other fees:

  • Electronic payment fee: Free
  • Cash payments: Free for 18 months and then no charge for deposits up to £1,000, then 70p per £100
  • Cheques (in or out): Free but limits may apply

Main features:

  • Free everyday banking for start-ups for 18 months
  • 0.10% gross/AER (variable) monthly interest on credit balance
  • Access online, Santander ATMs and Post Office branches
  • After 18 months reverts to Business Current Account tariff
  • Charges apply to non-standard transactions such as CHAPS payments, change-giving and foreign currency transactions
  • When applying, customers can also apply for a business overdraft of between £500 to £25,000 – there are fees associated with this.

As well as its Business Current Account, Santander has a business version of its popular 1-2-3 account. Start-ups will get a discounted monthly fee of £5 for 18 months, while switchers will get the same discount for 12 months. Thereafter, there is a £12.50 monthly fee. Account holders can earn up to £300 cashback each year, depending on the amount of annual credit turnover they have.

Starling Bank

Monthly fees: Free

Other fees:

  • Electronic payments: Free
  • Domestic transfers: Free
  • ATM withdrawals: Free

Main features:

  • Focused on small businesses and freelancers – but unlike others in this space, is regulated by PRA, FCA and has deposits protected by the FSCS up to £85,000
  • No monthly fees for those with less than £1.7m in annual turnover
  • Deposit money at 11,500 Post Office branches for £3 per deposit
  • Integrate Xero, PensionBee, Wealthify and FreeAgent
  • No fees to send or receive money via faster payments, direct debits and standing orders
  • Flexible overdraft available

At first glance Starling's business offering is compelling – zero monthly fees and zero fees on domestic transactions. Aimed at owners of limited companies and the self-employed, Starling offers oferdraft facilities and plenty of business planning and accountancy tools.

The Co-operative Bank

Monthly fees: Free for 30 months, but credit balance has to be above £1,000 otherwise a £5 fee. £5 fee thereafter regardless of credit balance.

Other fees:

  • Electronic payment fee: Dependent on balance and tariff – free, 17p or 70p for debit card purchases
  • Cash payments: £2,000 free per month and 75p per £100 thereafter
  • Cheques (in or out): 100 free per month and 25p thereafter, or 80p per cheque at Post Office

Main features

  • New Co-operative Bank business customers get free everyday banking for 30 months with Business Directplus
  • Members of the Federation of Small Businesses (FSB) can instead opt for the FSB Business Banking Account, which comes with some free banking services and an annual £25 loyalty bonus
  • There are tariffs for businesses with a high cash turnover (with low cash deposit fees) and businesses looking for a straightforward account charging structure (no transaction limits, and consistent charges).
  • Ethical bank
  • Access services through Post Offices, internet, telephone, post and branches

The Co-operative Bank offers an ethical option for business banking. While it has no dedicated high street offering, much like other newcomers, users can access services through the network of Post Offices around the UK. Businesses with cash in the bank can benefit from up to 30 months of fee-free banking.

Tide

Monthly fees: Free

Other fees:

  • ATM cash withdrawals: £1
  • Card payments: Free
  • Transfers between accounts: 20p
  • Cheques not accepted

Main features:

  • A ‘pay for what you use’ approach
  • No monthly or annual fees
  • Using card at home and abroad is free
  • Free transfers to Tide members
  • Create and pay invoices through the app
  • Share read-only access with accountant or finance team
  • Cash deposits can be made at the Post Office for £1 per deposit, or at any PayPoint for 3% of the deposited amount

Tide enjoys a 8/10 score on TrustPilot. Because it’s not a high street bank, Tide users manage their account and access its services through the app. Designed for small businesses, freelancers, sole traders and established enterprises, business owners can account for free, and get a contactless MasterCard plus up to 35 team cards for employees. Iwoca is fully integrated into Tide, meaning its customers can apply to iwoca for business funding and get a decision without leaving the app.

TSB

Monthly fees: Free for 25 months, then £5 unless average balance in month is £10,000 or more

Other fees:

  • Electronic payment fee: Free
  • Cash payments: 70p per £100 (after free period)
  • Cheques (in or out): 70p per cheque (after free period)

Main features:

  • 25 months free day-to-day banking for new customers and start-ups
  • Free Square reader for card and contactless payments (no fees for first £1,000 of sales)
  • Support from Enterprise Nation business support and Funding Options, the financial broker
  • Banking at the Post Office
  • 550 bank branches

TSB is part of Lloyds Banking Group and this business banking accounts comes with plenty of bonuses. After a lengthy free banking period of 25 months, customers are all put onto one tariff, where the monthly fee of £5 is waived if the average balane in the month is £10,000 or more. Another bonus is the free Square reader, which allows businesses to take payments from customers no matter where they are.

Ulster Bank

Monthly fees: Free for start-ups for 18 months, then £8 per quarter

Other fees: All transactions: Free for 18 months and then 40p per transaction

Main features

  • For businesses residing in Northern Ireland
  • Free for 18 months for start-ups or businesses with a turnover of less than £1m
  • 24/7 online banking tool
  • Dedicated business planning team
  • Other options available for businesses with higher turnovers
  • Free statements

One of the main banking brands in Northern Ireland, Ulster Bank’s services are naturally aimed at businesses based or with significant operations in the region. Businesses can sign up quickly in three steps and enjoy 18 months of fee-free banking. Simple pricing makes this an attractive option.

Yorkshire Bank

Monthly fees:

  • 25 months free for new businesses or those switching to Yorkshire Bank, otherwise £6.50

Other fees:

  • Electronic payment fee: 2.75% of transaction value, minimum £1.50 (after free period)
  • Cash payments: 65p per £100 (after free period)
  • Cheques (in or out): Manual entry check is 70p, cheques remitted 30p per cheque (after free period)

Main features:

  • 25 months free days banking for new business customers with a turnover under £2million who switch to Yorkshire Bank, and to start-ups who open a business current account within their first 12 months of trading
  • Choice of two accounts: Business Current Account and Business Chopice Account
  • Unlimited deposits and withdrawals, subject to available funds
  • Optional overdraft
  • Contactless card with £700 daily cash withdrawal limit

In October 2018, Virgin Money joined forces with Clydesdale Bank, for which Yorkshire Bank holds its trading name for. The bank offers two types of accounts, the first is for either those established small businesses that want to switch bank providers, or those start-ups that have been trading for less than 12 months. The Business Current Account offers free day to day banking for 25 months. The second type of account is the Business Choice Account which has a credit interest linked to the Bank of England base rate, an option of an agreed overdraft and personal attention from a business banking contact.

What other banking services does your business need?

Once you've got a business bank account sorted you may want to consider other tools or service types to make your business banking run as smoothly as possible. These include company credit cards, business loans, business insurance and – if business is going really well – a business savings account.


Sooraj Shah is a freelance business, technology and financial writer. He is a contributing editor of the New Statesman and a regular contributor to Forbes, specialising in cloud computing, dev-ops, the internet of things, cyber security, big data, artificial intelligence, and machine learning.

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