How to Open and Set Up a Business Bank Account in 6 Steps
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Setting up a business bank account is easy — and typically necessary for small businesses. Business accounts help all sorts of entrepreneurs, from freelancers to heads of corporations, manage company finances, streamline invoicing and simplify tax filing.
You can apply for a business checking account in minutes if you have the correct details and documents. Here are the steps to open a business bank account.
1. Decide which type of business bank account you need
Most businesses should start with a dedicated business checking account. But there are several other business bank accounts — business savings accounts, merchant services and even business credit cards — each with its purpose and benefits.
Best for: | Everyday use. | Long-term savings. | Accepting debit and credit card payments. |
What to keep in mind: |
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*You need to open a business checking account before you can get a merchant account, which is used for accepting debit or credit card payments. Learn more about merchant accounts. | |||
While you might start with a single business checking account, as your company and your cash flow grow, you’ll likely need multiple business accounts — from multiple business banks.
Some businesses keep payroll in a separate business checking account at a different bank from their main operating account. Others leverage a high-yield savings or business money market account to save for emergencies or longer-term goals, such as expansion.
2. Choose a bank for your business account
Business accounts vary in features, account limits, fees and perks. Decide what’s important to you and your business, then compare your options.
Consider the following factors when determining 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.
» MORE: Not sure where to start? Check out our picks for best banks for business accounts.
3. Gather the necessary documents, information
What you need to open a business bank account will vary from one financial institution to the next. But expect to provide the following:
Personal and business information.
Business formation documents.
Any organizing or partnership agreements.
4. Fill out the account application
Depending on the bank and business account, you can apply online, in person or over the phone. Applying online is usually quick and easy but lacks any personal touch. Applying in person may take longer, but your business banker can answer questions as you go.
5. Fund your newly opened business account
Most business bank accounts can be opened with $0, but some business checking accounts require an opening deposit, which can range 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 it will close the account for inactivity.
Avoid depositing all of your business’s assets at once. Most business accounts place a longer hold on deposits for new accounts, and you could lose access to those funds for 7 to 10 business days. Other accounts will flag large deposits, followed by large transactions, for fraud.
6. Set up your business bank account
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, set appropriate permissions and alerts, and establish recurring payments from your new business account.
The 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.
