Opening a business bank account should be at the top of your to-do list when founding a business. Ideally, you’ll want a business bank account that offers all the tools you need to manage your cash flow, track expenses, and make bill payments. Most banking platforms offer them, but not all have the same requirements. Use this guide to help you find the best banking solution for your company.
Key takeaways
- To be eligible for a business bank account, you must have a SSN/EIN and formation documents for your business structure (such as Articles of Incorporation).
- Some business banking providers, such as Bluevine, don’t require minimum balances, monthly fees, or transaction fees.
- When choosing the best business bank account, compare features such as online access, API integration, sub‑accounts, and customer support.
How do I know if I’m eligible for a business bank account?
Eligibility criteria for opening a business bank account differs between financial institutions, but only slightly. Typically, being a United States–based business owner is enough. Most business banking platforms require an employer identification number—unless you’re operating a sole proprietorship or general partnership, in which case you can open an account with just your Social Security number(s) and photo IDs. If you’re opening a business bank account, your banking provider will also want to see incorporation documents—we’ll cover that in more detail below.
Remember that financial institutions have business bank account compliance rules they must adhere to. The bank or platform can refuse you if they decide your business is non-compliant with their guidelines. Incorrect or misleading statements on your application are one reason they might do that. Avoid those at all costs.
What documents are required to open a business banking account?
One of the first steps in forming a business is to request an employer identification number (EIN). Also known as a federal identification number, an EIN is your business’s unique identifier. The IRS uses it for business tax filings, and vendors and partners may request it to review your company’s credit history and business credit score.
The Internal Revenue Service (IRS) is the issuing body for EINs. They’ll assign you a number within minutes if you apply online. You can also fax or mail your request using Form SS-4. Keep a copy of that form for your records and save a hard copy of the confirmation letter the IRS mails back to you, as your business banking provider will accept either. They may also ask for:
- DBA Certificate (if not incorporated): “DBA” stands for “doing business as.” It’s an ownership status for non-incorporated businesses. DBA certificates are typically issued by the town or city where your business is located.
- Articles of Incorporation: Articles of Incorporation are formation documents that show your business’s name, address, registered agent, and corporate structure (LLC, C-Corp, S-Corp, non-profit, etc.). They do not include your bylaws, which are separate.
- Personal ID: Each account signatory will be asked for two forms of identification. Most banks accept a state-issued license, passport, social security card, or birth certificate. At least one form must be a photo ID.
- Business licenses (if needed): Certain towns and cities require business licenses to operate in specific fields. Food vendors or retail stores are good examples of this. The bank may want to see these licenses if they’re required.
If you’re opening a business banking account online, you can use digital copies of these documents to apply. If you prepare your documents ahead of time, most online providers can open an account for you in under an hour.
What are the minimum balance requirements for a business bank account?
Beyond having proper documentation, it’s possible your account will require a minimum balance. Not all business bank accounts require this—traditional banks tend to have minimum balance requirements more often than financial technology companies. Those that do require it will give you a few days to fund your account before facing penalties.
In some cases, the minimum balance is required to waive a monthly fee. If you’re a small business owner, the best way to avoid these fees is to simply do business with a banking platform that doesn’t charge them. You can also look for places that offer additional benefits or features, like high annual percentage yield (APY) and overdraft protection, if you keep a minimum balance or maintain a certain level of activity.
ONLINE BANKING VS. TRADITIONAL BANKING
More and more small businesses are choosing mobile-first and online-only banking platforms over traditional banks because of added convenience, lower fees, and better mobile tools.
Which business bank accounts have the lowest fees?
Many banks and financial services providers don’t charge monthly fees, but some charge for transactions or overdrafts. Others set limits on the number of payments and transfers you can send each month. These fees need to be factored into your business finances when reviewing business bank accounts—each fee is an expense your bookkeeper must account for.
| Fee | Bluevine | Traditional banks |
|---|---|---|
| Monthly fees | $0 for Standard plan | $15–30 per month |
| Overdraft fees | $0 | Up to $35 |
| Minimum balance | $0 | Up to $5,000 |
| Transaction limits | Unlimited | As few as 50 per month |
Conclusion: How to choose the best business bank account
If you want specific account features, you can look for banking platforms with multiple business banking plans. That’s where you’ll most likely find the services you want, including debit cards, online business banking features, automated bill pay, and access to working capital in the form of a business line of credit, loan, or business credit card. Other sought-after features are the ability to create sub-accounts and API connectivity to accounting software.
Financial management for businesses is hard, but choosing a business bank account shouldn’t be. The factors you’re comparing should include customer service, accessibility, features, services, fees, and balance/transaction limits. Your business account should match your business needs, so take your time and review each of your options carefully.
Another variable is the type of bank or account provider you choose. National and regional banks are often impersonal and tend to underserve small business owners. Community banks are more personalized. The best online banking platforms offer customer service by phone, chat, or email—plus, their fees are low and processing times are fast. Whichever you choose, make sure your business bank account meets your comfort level and can scale with your business.
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