A guide to start up business accounts
There are many competitive startup bank accounts available, which each provide a range of benefits, features and facilities. To help you find the ideal startup business account, we have compiled this useful guide to start up banking options.
Interested in a start up business bank account?
Why not try out our bank account finder? This is a free, no-obligation tool that will help you find the most suitable account for your business.
What is a startup business account?
Start up business banks are similar to standard business accounts, as they all provide a way to manage your finances. However, there are some differences in terms of the account features, benefits and costs. In general, a startup business bank account will cost less than a bank account designed for an established business.
Many banks will charge no fees for an initial period, as a way to support your business in its early stages. There are benefits designed to help you get your business of the ground, such as business advice and accounting software integration. Banks are keen for you to open startup business accounts, in the hope that you will become a long-term customer. This means that you can benefit from a variety of great perks.
Do you need a start up business account?
If you are starting a business, one of the first things you will need to do is to open a bank account. A business account will save you time, simplify your accounts and help you organise your businesses finances. In some situations, opening a bank account is a legal requirement.
If you are running a limited company or partnership, by law you will need to open a business account. As you and your business are considered to be separate legal entities, your finances must be separate. If you are a sole trader you can use a personal account, although in many cases this is not practical. As a sole trader, using your personal account could mean you are in breach of your bank’s terms and conditions.
By separating your business finances from your personal accounts, your bookkeeping will be streamlined and simple. You will be able to easily monitor your business expenses, which will ensure you pay the correct amount of tax. If you ever need a loan, being able to show accounts will help you gain approval for the credit you require.
What are the benefits of a start up bank account?
As a start up business, there are benefits to opening one of the specific bank accounts for business start ups. These benefits can be invaluable to young businesses, in terms of low-cost banking and the range of additional features.
When you search for the ideal start up business bank account, consider which features are most important to your business. For example, your bank could provide benefits such as:
- No charges when you pay cash into the account
- A branch in a convenient location to your business
- Additional support, such as a business mentor or software advisor
- A bank account with no monthly or annual charges
- A fee free period of up to 25 months
- Online banking through a well-designed website or mobile app
- Flexible borrowing through an overdraft, loan or credit card to help you find your feet
Which is the best start up business account?
There is no single bank which provides the best bank for start-up businesses, as each provides different features. The best start-up option will be the bank account which offers the service benefits for your specific requirements.
There are many high-street banks which provide start up business accounts, however 'challenger banks' are becoming a popular alternative. These challenger banks are smaller than the traditional banks and usually specialise in providing an online alternative. Many of these accounts are designed specifically for start-ups, with features catering to the needs of small business management.
The following accounts are designed specifically for start ups and include both high-street and online options:
- Revolut for Business – This account is designed to save you time and money, if your business regularly processes domestic and international payments.
- Tide Business Current Account – This account is designed to make small business banking as simple as possible, with a 5-minute online application. There are no monthly fees and you will receive a free Mastercard.
- HSBC Business Account – An account from a high-street bank which is designed to help new businesses grow. The account features 18 months free banking, with a variety of online business support services.
- Yorkshire Bank Business Current Account – With more than 180 branches across the UK, this account provides great access to a range of traditional banking facilities. In addition, you can benefit from 25 months free banking and one-to-one advice from your relationship manager.
- CashPlus Business Current Account – This bank was established in 2004 and operates across the UK. There are no credit checks and it is free to use UK ATMs, process bank transfers and pay staff wages.
- Clydesdale Bank Business Current account – Clydesdale Bank has years of experience in assisting start up businesses which operate in a range of industries. This account provides 25 months free day-to-day everyday business banking.
- Anna Business Account – This is an account designed specifically for startups, small businesses and sole traders. The account includes a free invoicing service, which creates and chases late payments.
- Countingup Startup Account – This start up business account aims to bring your banking and accounting together. It takes just 5 minutes to complete the mobile application form and there are no credit checks.
- Santander Business Current Account – This small business account is ideal for start-ups looking for a traditional bank account. It is possible to earn interest on your balances and you will receive cashback annually on your credit turnover.
- CardOneMoney Business Account – This account is designed to provide easy bank account access, through SMS, phone and online management. There is a convenient online payment system to help you manage bills, invoices and wages.
- Acorn Business Account – Acorn was established in 2007 and now provides both personal and business accounts. They specialise in providing accounts to those with poor credit histories.
- Fair Everywhere Business Account – If your business regularly does business at home and abroad, this account offers excellent currency rates. There are free international money transfers and cashback rewards for using your account.
How to find the best start up business bank account
Perhaps your personal bank provides a great service, but they may not be ideal for a startup bank account. Taking the time to complete a start up business bank account comparison, will ensure you open the best account available.
Here at BusinessComparison, we can help you find exclusive deals for your startup account. Whether you are opening your first business account or switching to a new start up account. To help you compare start up business accounts, we have developed a free, no-obligation comparison service. This innovative tool is designed to help you find the ideal start up business account for your business.
Simply use the quick filters and our useful tool will compile a list of matching accounts. It is possible to filter by features such as:
- A quick application process
- Banks with a long fee free period
- The ability to open an overdraft
- Banks for those with poor credit
- A mobile bank account application
- Low fees to pay cash into the account
- Accounts which will pay interest on your balance
- Banks which provide low cost foreign transfers
Our comparison tool will provide you with a list of potential start up business accounts, which you will be able to easily compare. You will quickly be able to compare free banking periods, monthly costs and whether they provide accounts for start ups. We have listed the product features and key facts, so you can see what each start up business account offers.
Once you have found the bank account for your business, click the link which will take you to their website. From here you will be able to complete your online start up business account application.
Before you open your start up business account, it is advisable to compare reviews from other businesses. There are reviews online, which will provide you with an insight into their experiences with the various startup bank accounts.
How to open the best bank account for small business start ups
The process to open an account is designed to be quick and simple. If you are opening an online account, it is likely the whole application will be completed online. For traditional start up business accounts, you will be able to start the application online, however you will need to visit a branch.
You will need to prove your ID and address, alongside providing some key business information. For example, your business address, contact details, annual turnover and Companies House registration number.
If you already have a business account, you may be interested switching banks if you’re unhappy with your current bank. Many of the start up bank accounts are members of a switching guarantee service. If your current bank is a member, you will be covered by the 7-day switch guarantee.
To find out more about our range of business comparison services, please contact our team today.