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A guide to helping you understand Community Interest banking
A guide to community interest bank accounts
If you run a community interest group, you will need a low-cost bank account with a range of great benefits. To help you find the ideal community interest business bank account, we have compiled this quick guide.
What are community interest bank account
The majority of community interest groups will require a bank account, held in the name of the group. A designated bank account will help you keep track of finances, while also assisting with grant applications, donations and bills.
You will need to open an account which is designed specifically for community interest groups or charities. The banks tend to class community groups as clubs and societies, although some accounts are only available to registered charities.
The bank account you open will be handled by the team which manages business accounts. Although most business accounts incur fees, this is not always the case for community interest bank accounts.
There are many free community interest accounts available, however you will have to pay some charges for specific transactions. For example, some banks will charge for overdrafts, paying in a cheque and paying direct debits.
How to find the ideal community interest account
When you begin searching for a community interest bank account, look for one which closely matches your requirements. Are you able to avail of the key features your group requires, such as:
A cheque book
Online banking
Debit card
High-street branches
A mobile banking app
There are some bank accounts which will pay interest on the cash held in your bank account, although they may charge for the account. It is important to compare accounts, as even if your business earns interest, it may cost more in monthly fees. If you are looking specifically to earn money, you could open a separate savings account for a large sum of money.
Here at BusinessComparison, we specialise in helping businesses compare financial products. We don’t include specific community interest accounts in our service, however we can help you compare a range of business accounts. Our comparison service includes a range of traditional and alternative accounts which can be opened by community interest groups.
Within our tool, you will find a list of accounts with easy to compare features. The list clearly displays each accounts monthly charge, length of any free periods and the key account features.
How to open a community interest bank account
When you apply to open a community interest bank account, you will need to prove that you are not a private business. You will need to show evidence that your group is a voluntary organisation, which is not making a profit. The ideal documents are:
A copy of your group’s constitution
Your Charity Registration confirmation or trust deed, if your community group is a charity
The Memorandum and Articles of Association, if your group is a registered limited company
You may also need to provide:
Minutes of the meeting where the specific bank was chosen
Details of at least two people which are able to sign cheques and approve withdrawals from the account
The names of signatories for the account, two of which should also be able to sign cheques.
Proof of ID and proof of address, unless the signatories already hold a personal account with the bank
Personal bank statements to prove their personal finances.
If you already hold a community interest account, it can be beneficial to compare accounts regularly. It is possible to switch to new bank accounts quickly, so that you benefit from the most suitable account. Many banks offer a 7-day switch guarantee, with all payments and direct debits moved to the new account.
If you need some free advice our business experts would be happy to help
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