How to Choose a Business Bank Account as a Service Provider

One of the first things you should do as a service provider is set up a separate bank account for your business—specifically, a business bank account. 

A business bank account protects you legally and financially by separating your business and personal funds. It’s easier to track your deposits, pay contractors, and mark expenses as business deductions during tax time.

But which business back account should you choose? What do you need to look for? What should you avoid? This is everything you need to know about choosing a business bank account as a service provider:

What Makes a Business Bank Account “Good?”

There are thousands of business bank accounts; you can find them at your local credit union or search Google and find a virtual option, but each has its pros and cons. As a service provider, an online bank account will likely be exactly what you need—so that’s what we’ll focus on.

When you’re looking for a “good” business bank account, there are a few things you want to ask yourself/take into consideration:

• What is the average and maximum savings APR?
• Do they charge transaction fees? If so, how much?
• Do they allow the creation of multiple accounts and cards if needed?
• What is the spending limit per day? What about per month?
• Do they integrate with your accounting/bookkeeping software?

Whether or not the answers to those questions make a difference in whether you should or shouldn’t use a specific bank account will depend on your business. For example, if you use (or plan to use) QuickBooks Online for your bookkeeping, but the bank account you’re considering doesn’t integrate with QBO, it might not be the right account for you.

Why Are Online Business Accounts a Popular Choice?

Accessibility, ease, and lack of fees. While traditional business bank accounts are ideal for brick-and-mortar store owners due to cash on hand, online service providers don’t typically keep cash on hand, nor do they have deposits or withdrawals so often.

With an online business account, service providers can save on fees and often find higher savings APRs at a lower minimum amount of cash required. It can also help with paying invoices overseas or receiving payment from a client from another country.

My Business Bank Account Recommendation

For my clients, I recommend Relay, an online banking service—partially because they work well with businesses and bookkeepers to provide a “white glove service,” so always ask before signing up!

Relay integrates with many of the platforms you’re currently using, like Plaid, Gusto, QuickBooks, and Xero. Plus, it gives you plenty of opportunity to grow comfortably by adding contractors or employees, a bookkeeper, and getting a larger savings APR.

Not sure if Relay is for you—or do you already have a business bank account but your books aren’t organized? Book a consultation to see how I can best help you!