Best Sole Trader Bank Accounts October 2024

With its simple and well-received offering Monzo Business, is a great option for anyone just starting out.  

Monzo offers an array of business banking services that are useful to sole traders, including accounting software integration and its ‘tax pots’ feature. However, some features are only available to customers who pay the monthly fee for Monzo’s Pro account. 

For further details, read NerdWallet’s Monzo Business Account Review.

Monzo key features:

• Speedy account opening: Most accounts are up and running on the same day as an application is made. 
• FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.
• Free UK transfers: Business banking customers can make unlimited free electronic payments in the UK.
• 24/7 customer support: Monzo’s in-app customer support is available at all hours for customers with urgent concerns.
  

Pros:

• Monzo’s Business Lite account has no monthly fees and free bank transfers in the UK.
• Customers can manage their money online or via Monzo’s well-reviewed mobile app.
• Most customers receive access to online banking on the same day as they apply.

Cons:

• Customers cannot manage their accounts in-person, as Monzo does not offer telephone banking and has no branches.
• There are no Monzo accounts available to charities or partnerships.

Starling’s free account for sole traders, limited companies and limited liability partnerships carries no fees for basic transactions. In addition, the provider’s app is among the best-reviewed in the banking market and customers can access support 24/7. 

Starling key features:

• No monthly fees: There is no monthly fee for Starling’s business bank account.
• Transaction fees: Customers can make Faster Payments, direct debits and standing orders for free within the UK.
• FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme. 

Pros:

• There is no monthly fee for a basic Starling account.
• Electronic transactions such as Faster Payments, direct debits and standing orders are free within the UK.
• Starling says 98% of its business accounts are open on the same day an application is received, with an average account opening time of one day.

Cons:

• Some account features are only included as part of the Business Toolkit, which costs an extra £7 a month.
• There is no option to manage your money over the phone or at a branch.
• Customers wanting to deposit cash will need to do so at the Post Office and pay a £3 minimum fee.

This app-based business account is designed for sole traders and sole directors with an annual turnover of less than £6.5 million. The app is one of the best reviewed out there and is backed by a traditional bank. 

HSBC Kinetic key features:

• Fee-free period: There are no monthly fees for the first 12 months after opening an HSBC Kinetic account. 
• Transactions fees: Customers do not have to pay for direct debits, standing orders and other payments.
• Borrowing: Customers can apply for a business overdraft, credit card or HSBC Kinetic Small Business Loan of up to £10,000.
• FSCS protection: Deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).

Pros:

• Transactions, such as direct debits and standing orders, are totally free with HSBC Kinetic.
• Borrowing options include a business overdraft, credit card or the specific HSBC Kinetic small business loan.
• HSBC says Kinetic accounts are normally open within 48 hours.

Cons:

• Following an initial year-long introductory period, an account costs £6.50 a month.
• HSBC Kinetic Current Account is only available to sole traders and limited companies with just one director who is the sole shareholder, and a maximum annual turnover of up to £6.5 million.

With ethical and sustainable practices at the forefront of the Co-Operative Bank’s ethos, the provider could be attractive to business owners who prioritise social responsibility. There are also many different accounts to choose from, meaning there are options for a variety of businesses and charities.

For further details, read NerdWallet’s The Co-operative Bank Business Account Review.

The Co-operative Bank key features:

• Account options: With a choice of six different business accounts, there are options for many different kinds of customers.
• FSCS protection: Your eligible deposits, up to £85,000 across all of your accounts, are protected by the Financial Services Compensation Scheme (FSCS).
• Borrowing: Borrowing options include an arranged overdraft, a charge card for expenses, a credit card, and a variable rate business loan.
• Account management: Customers can manage their money online, over the phone, via the app and at a branch.

Pros:

• Some accounts with the Co-operative Bank have no monthly service fee, including a small business account developed specifically for members of the Federation of Small Businesses. 
• There are no transaction fees for basic electronic transactions, such as direct debits, standing orders, card purchases and ATM withdrawals.
• Borrowing options include a business overdraft, credit card, charge card and loan.

Cons:

• With average account opening times of 13 days, the Co-operative Bank is slower off the mark than many of its competitors.
• There is no 24/7 customer service available.
• Customers in Northern Ireland have no access to branches.

HSBC offers a range of business accounts for different needs, including an account tailored specifically for small businesses. HSBC’s business accounts offer free basic banking transactions but charge a monthly fee once the 12-month free period (if applicable) ends.

These options are separate from HSBC Kinetic, which NerdWallet has reviewed separately.

HSBC key features:

• New customers: HSBC’s introductory offer for business accounts includes 12 months of free banking.
• Transaction costs: Everyday banking transactions are free with an HSBC business account.
• Credit facilities: Borrowing options include business overdrafts, credit cards or loans.
• FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.

Pros:

• HSBC’s introductory offer for its small business banking account and business banking account includes free banking for 12 months, as well as free daily transactions.
• Accounts can be accessed online, via a mobile app, over the phone or at a branch.
• HSBC also offers borrowing options such as a business loan.

Cons:

• Following an introductory period, HSBC’s business accounts charge a monthly maintenance fee of £8.
• HSBC’s app has not been as well-recieved as many competitor’s offerings.
• The average wait for an HSBC business account is 4.9 days.

This British high-street bank has specific accounts for startups, established businesses and charities or community groups. With branches all across the UK and considerable borrowing options, Barclays could be a great option if you prefer a traditional bank. 

For more details, read NerdWallet’s Barclay’s Business Account review.

Barclays key features: 

• Account access: Accounts can be managed online, via the app, over the phone, or at the wide range of Barclays branches.
• Credit facilities: Barclays offers a wealth of borrowing options, including loans, mortgages and overdrafts.
• FSCS Protection: Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).

Pros:

• There are a variety of different accounts for those in different circumstances, with accounts for start ups or more established businesses, as well as charities and community groups.
• Customers can enjoy free access to Freshbooks accounting software.
• Customers do not need to pay for basic transactions, such as direct debits and standing orders.

Cons:

• Barclays business accounts carry an £8.50 per month maintenance fee after the end of the introductory offer period. 
• An average set-up time of seven days and the potential for a 48-day wait makes Barclays one of the slowest account openers.
• Only businesses that have been trading for less than a year can apply for a Barclays start-up account.

Mettle is an offshoot of the NatWest Group and brings to the table a business account made specifically for self-employed workers and limited companies with up to two owners. These accounts have no monthly fees or transaction charges and offer users the chance to manage their accounts through one of the best reviewed apps on the market. 

For more details, read NerdWallet’s Mettle Business Account review.

Mettle key features: 

• Great app: Mettle’s business banking app has top review scores across different platforms.
• For sole traders: Mettle has an account that is specifically designed for UK-based sole traders, as well as an account for limited companies with a maximum of two owners.
• Deposits protected by FSCS: Eligible deposits are protected up to a total of £85,000 by the Financial Services Compensation Scheme.

Pros:

• Accounts are completely free, with no monthly fees or transaction charges.
• Mettle has one of the best-reviewed business banking apps on the market.
• Cash deposits can be made at the Post Office (and also at a PayPoint for e-accounts).
• Customer support is accessible via the app or email and over the phone seven days a week.

Cons:

• There is no way to access support in a branch.
• Account holders cannot deposit cheques.
• You cannot make international payments with a Mettle account.
• Mettle does not provide borrowing options such as overdrafts, credit cards or loans.
• Mettle accounts may take a while to open, with the provider stating it aims to review all new applications within 72 hours (excluding weekends). 

The three different accounts offered by RBS only charge for what customers use, meaning there is no fixed maintenance fee. 

With a Start-Up Account that carries no transaction fees for the first 24 months, new sole traders could find this an attractive option. 

For more details, see NerdWallet’s RBS business account review.

RBS key features:

• Fee-free period: The Start-Up Account has no transaction fees for the first 24 months.
• Borrowing options: Customers can get a business overdraft, credit card or loan with RBS.
• Extras: RBS customers get free access to FreeAgent accounting software and access to a dedicated relationship manager.
• FSCS protection: Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).

Pros:

• The Start-Up Account has no monthly cost and includes a 24-month introductory period with no digital transaction fees.
• Around 77% of RBS customers get their business accounts up and running on the same day they apply.
• RBS accounts can be managed at a branch, over the phone, online and via the app.

Cons:

• RBS is best suited to customers in Scotland, with customers in England and Wales likely to be directed towards NatWest and those in Northern Ireland likely to be directed to Ulster Bank. 
• Eligibility requirements for the RBS Start-Up Account mean businesses will need to have been trading for less than a year in order to apply.
• Following initial fee-free periods, RBS business customers need to pay for most transactions.

NatWest offers three different business accounts for start ups, established businesses and charities or non-profits. NatWest’s business-oriented accounts offer banking for no monthly fee and two years of free basic transactions for switchers who meet certain criteria, though all carry a cost after this introductory period. 

For more details, read NerdWallet’s NatWest business account review.

NatWest key features:

• FSCS protected: Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
• Lending options: With NatWest, you can apply easily for credit cards, loans and overdrafts for your business.
• Introductory offer: For eligible customers, NatWest offers access to two years of free everyday transactions.

Pros:

• Access your account in a branch, or via app, phone or online account access. 
• It takes an average of just one day to open a business account.
• NatWest customers get free access to FreeAgent accounting software.

Cons:

• There are no NatWest branches in Scotland or Northern Ireland.
• A fee applies to all transactions after the introductory period has expired.