The Best Small Business Bank: Reduce Your Account Fees
National, Local, or Online Banks for Business
One of the fist steps in setting up a new small business is establishing a small business bank account. But which bank is the best for small business? There are many choices for entrepreneurs, but as with all things, businesses will find that when it comes to banking, you get what you pay for.
Most banks offer a basic small business account that offers checking and limited transactions every month. But beware, some charge a fee just to exist.
Wells Fargo offers simple checking for small businesses with a $5 maintenance fee, but that fee can be waived if you sign up for online statements and maintain $250 average balance.
Bank of America offers a similar deal, but is less forthcoming on what the minimum balance is. That may be reason enough not to trust them. Never trust a bank that makes you read the fine print to find the monthly maintenance fee.
U.S. Bank offers a real free, no strings attached small business account. Plus, they have a robust online platform for those who prefer to avoid going to the bank.
If you prefer to do all of your banking online or by phone, your best choice may be American Express which has business direct banking online for free.
If you can join Navy Federal Credit Union, they have a great no-minimum, no fee option.
The worst bank of the bunch is TCF Bank, a regional bank in the Midwest. While this bank offers free business checking, the bank overall has built their profits on fees. They are so invested in recovering fees from their clients and merchants that they sued the federal government over the new banking rules. Any bank that has built their business model on fees is bad news. Avoid them.
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Credit Unions for Small Business
Credit unions often offer the best deals on loans and the best interest rates. They are particularly friendly to local businesses and tend to be more open to building long term busines relationships with local clients. They may be the route to building a temporary line of credit with a local bank.
So why don't more people use them? Firstly, they are often not as convenient as larger banks. They often have few branches and are not open beyond normal bank hours. Some, however, do offer extended hours and Saturday banking. If you are concerned that credit unions do not have a national presence, know that many credit unions are in a credit union coop that allows you to use ATMs nationwide.
But if convenience is not important to you, investigate local credit unions where you might get a small business loan or keep a small business savings account. They might have better rates.
