How to Open a Business Bank Account in 5 Steps

Opening a business bank account is typically necessary for small businesses of all sizes to keep their personal and professional assets separate. Business checking accounts help all sorts of entrepreneurs manage company finances, streamline invoicing and simplify tax filing. And applying for one may only take a few minutes if you gather what you need to open a business account in advance.

Here's how to open a business bank account.

Most businesses should start banking with a business checking account. If your business is small, that may be all you need. As your business grows, however, your banking will likely get more complicated — you may need multiple types of accounts, potentially at multiple banks. (More on that below.)

There are lots of free business checking accounts, many with no minimum balance requirements. Consider which of the following factors are most important to your business to help determine where to open your business account:

• Monthly fees.

• Minimum balance requirements.

• Included fee-free transactions.

• ATM access (withdrawals and deposits).

• Wiring, transfer and payment capabilities.

• Incidental fees (stop payment, nonsufficient funds, overdrafts).

• Additional features, including bill pay, invoicing, accounting software integration or other business tool integrations.

In general, brick-and-mortar banks offer a personal touch and well-established ATM networks, along with other financial products like business credit cards and small-business loans. But they usually limit monthly transactions and charge more fees.

Online business bank accounts are more likely to offer unlimited transactions and fewer incidental fees, but you won’t be able to walk into a branch for help. Also, note that many of these are neobanks — not banks themselves, but financial technology companies that partner with banks to keep your funds in accounts protected by the Federal Deposit Insurance Corp. (FDIC).

No matter where you bank, make sure your funds are insured up to at least the FDIC limit of $250,000 per depositor, per institution.

» Not sure where to start? Check out our picks for best banks for business accounts.

Most banks, even brick-and-mortar ones, now let you fill out an account application online. A handful may require you to come into a branch to complete the process, though, and you can kick things off in person at such institutions as well.

Applying at a branch might take longer, but can make sense if you want to ask a business banker questions as you go. Online applications can typically be approved right away, though you may need to supply additional documentation in certain instances.

What you'll need to submit in your application can vary. But expect to provide at least the following:

• Personal and business information, like your Social Security number and Employer Identification Number (EIN). 

• Business formation documents.

• Any organizing or partnership agreements.

• Other items on this checklist.

» MORE: Can you open a business bank account without an EIN?

Most business bank accounts can be opened with $0, but some business checking accounts require an opening deposit, which typically ranges from $25 to $100. Business savings accounts can have higher deposit requirements — anywhere from $1,000 to $25,000, depending on the account — but you can still open many with $0 to start.

Business accounts that can be opened with no money still require you to fund the account within a specific timeframe or the financial institution will close the account for inactivity.

Did you choose a business bank account offering a promotion? Now is a good time to review its terms. Many of these offers require you to deposit a certain amount of money right away and maintain an average balance for several months.

Once your account is open and funded, it’s time to set up your account. Start by downloading your bank’s mobile app and then sign up or log in to the online banking platform.

Then, connect your new bank account to your business accounting software and any other relevant business tools — many business bank accounts offer direct integration with popular software and apps like QuickBooks, Xero, FreshBooks, Shopify and Gusto.

You can also add authorized users and set appropriate permissions. This may be important based on your business setup. For instance, if you're opening a business bank account for an LLC, multiple members of your organization may need access. You can also set up recurring payments and account alerts.

Your main business debit card will ship automatically and typically arrive in seven to 10 business days. If your bank offers these options, you can order checks and request any additional employee debit cards.

Banks offer several other types of business accounts — including business savings accounts and merchant services accounts — each with its purpose and benefits.

Not every business needs these accounts right away. You may be able to use a payment processing company instead of opening your own merchant services account, for instance.

But as your business grows, you’ll likely need additional accounts. That could be for operational efficiencies — like keeping payroll in its own account. Or it might simply be to take advantage of higher interest rates: Leveraging a high-yield savings or business money market account for your cash reserves could make sense when you're saving for emergencies or longer-term goals, such as expansion.