Bank fees were once considered unavoidable for small business owners, but that’s no longer the case. Some traditional banks impose unnecessary fees, while many online-only banks offer business checking accounts that strip their fee structures to the essentials. We’ll break down the most common business checking fees and tell you the best way to avoid or minimize them.
Monthly service fee for a business checking account
Traditional brick-and-mortar banks justify monthly service fees because of the cost to maintain their physical locations. Those fees typically range from $10 to $25 per month, and may be waivable if your business meets certain transaction limits or maintains a minimum balance.
How to avoid monthly fees
Avoiding this fee is simple—open an account that doesn’t charge monthly service fees. The list of no-fee business checking accounts is extensive, as most online banks and many traditional banks don’t charge monthly fees to stay competitive.
Overdraft or non-sufficient funds fee
An overdraft occurs when the bank covers a transaction you lacked sufficient funds for, while nonsufficient funds (NSF) refers to when the bank chooses not to clear such transactions. Both scenarios may result in fees ranging from $10 to $50.
How to avoid overdraft and NSF fees
To avoid overdraft and NSF fees, regularly monitor your balance, especially before making payments via check, ACH, etc. You could find a business checking account that doesn’t charge overdraft fees or NSF fees, but you still may need to maintain sufficient balance to avoid other penalties.
Excess transaction fee
Many banks impose limits on how many transactions you can make per month, charging a fee for any transactions over the limit. Some bank accounts also restrict the amount of each transaction, a practice suitable for investment accounts but inconvenient for everyday business checking accounts.
How to avoid excess transaction fees
To avoid excess transaction fees, consider an online business checking account that allows an unlimited number of transactions. Accounts with transaction amount limits may also raise or lift them after you’ve established a solid banking history.
Domestic wire transfer fee
Domestic wire transfers are useful for fast delivery of funds domestically. Traditional banks often charge a fee to send wires, typically from $15 to $30. Some also charge your account to receive them.
How to avoid wire transfer fees
To avoid wire transfer fees, be sure to choose a business bank account that doesn’t impose incoming wire fees, and compare rates for outgoing wire transfers to make sure you’re not getting nickel-and-dimed.
Checkbook fee
While modern business checking accounts primarily facilitate digital transactions, traditional paper checks can still be useful, but these can cost between $20 to $40, plus shipping.
How to avoid checkbook fees
Some business bank accounts provide one or two checkbooks for free, then charge for additional checks. You can avoid these fees by using alternative payment methods like standard ACH or by using a business checking account that will send check payments for you.
Additional debit card fee
Companies with multiple locations or traveling partners may require more than one debit card, especially if multiple people are authorized to make purchases. Some banks allow you to order additional debit cards, but this may come with additional fees.
How to avoid fees for additional debit cards
To avoid fees for additional debit cards, find a business checking account that offers additional debit cards for free. Ideally, choose a bank with an online dashboard you can use to track spending across all the cards and generate expense reports.
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