How to Get a Free Business Checking Account

Quick Answer

You can find free business checking accounts with no recurring fees at banks, online banks and credit unions. When choosing a free business checking account, consider the account’s features, your business’s needs and any other fees the bank may charge.

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As a business owner, you want to keep as much of your hard-earned profits as possible. Could a free business checking account help? Also called no-fee checking accounts, free checking accounts do not charge recurring fees for things like account maintenance, withdrawals or transfers between accounts, although they may charge other fees.

You can find free business checking accounts at banks, online banks and credit unions. But before opening one, consider all the pros and cons to make sure it's right for your business.

Why You Need a Business Checking Account

Like a personal checking account, a business checking account is a bank account where you can safely store your money while also keeping it easily accessible. You can link a business checking account to other bank accounts, such as a high-yield savings account. You can also use it to deposit payments from customers, transfer funds to other accounts, pay your business's bills and more.

There are some key differences between business checking accounts and personal checking accounts. Business checking accounts usually have higher minimum deposit requirements and higher transaction limits. Many also offer features to help you run your business, such as integration with your business accounting software, bookkeeping or invoicing tools, employee debit cards and integration with merchant services so you can accept credit cards.

Manage Your Business Finances

Find Business Checking Accounts

Not all business checking accounts are free. Many business checking accounts have monthly maintenance fees that can be waived by maintaining a certain minimum daily or average monthly balance. Drop below those thresholds, though, and the monthly fee kicks in.

Other common fees a business checking account may charge include fees for exceeding a certain number of transactions per month or exceeding monthly limits on cash deposits. Even no-fee checking accounts may have fees for certain services, such as checks, wire transfers, stop payments, overdrafts or using non-network ATMs.

Reasons to Get a Business Checking Account

Whether you own a retail corporation or freelance part time as a tutor, a business checking account offers many benefits.

  • Legitimizes your business at tax time: The IRS could deny your business tax deductions if it deems your business a hobby. Maintaining a separate checking account in your business's name, which the IRS advises, demonstrates that you're operating in a businesslike manner.
  • Simplifies record-keeping: It's easier to keep track of your business income and expenses when your business finances aren't mixed with your personal funds.
  • Provides access to business services: Business checking account features such as invoicing, bookkeeping and accounting tools, and integration with merchant services accounts help to streamline your business's finances so you can spend more time growing your business.
  • Protects your personal assets: Should someone sue your business, separating your business funds from your personal bank account will help safeguard your personal assets from legal liability.
  • Helps establish a business credit history: Opening a business bank account is the first step to building a credit history for your business, which you'll need to get business loans, lines of credit and credit cards later on.
  • Builds a business banking relationship: The bank where you open your business checking account could be a source of financial advice or even financing as your business grows.

How to Find Free Business Checking Accounts

Here's how to find the right free business checking account for your business.

Research Your Options

Free business checking accounts are available at traditional banks, online banks and credit unions. Because they have lower overhead costs, online banks may be more likely to offer no-fee accounts or interest-bearing business checking accounts. On the downside, with no physical locations, you can't meet with a banker to discuss your business needs or explore financing options. It may also be difficult to make cash deposits or access merchant services at online banks.

Protect Your Money

Whether you opt for a traditional or online bank or a credit union, be sure to choose a financial institution that's federally protected. Business checking account deposits in banks insured by the Federal Deposit Insurance Corp. (FDIC) and credit unions insured by the National Credit Union Administration (NCUA) are guaranteed up to certain limits even if the financial institution fails. (There may be different limits depending on your business entity.)

Determine What Services You Need

Here are some business checking account features you may want to look for:

  • Low or no fees
  • Integration with your business accounting or invoicing software
  • Built-in bookkeeping, accounting or invoicing tools
  • Integration with merchant services or payment apps
  • Scanners to remotely deposit checks in bulk
  • Employee debit cards that allow you to set spending limits
  • Account access or authorized signer options for your employees, bookkeepers or accountants
  • Interest-bearing checking accounts
  • Ease of making cash deposits
  • Same-day automated clearing house (ACH) transfers
  • Wire transfers
  • Convenient ATM access
  • Financial advisory services
  • Business loans, lines of credit or credit cards
  • Welcome bonuses for opening an account

Look for the business checking account that offers the best combination of low or no fees with the services you need. Carefully reading the bank's fee schedule and considering how your business will use the account will help you determine if a free business checking account makes sense for you.

A free business checking account might not be your best option if the limits on monthly transactions or cash deposits don't fit your business needs. On the other hand, an account with a monthly maintenance fee could ultimately save you money if services you use regularly are included at little or no cost.

How to Open a Free Business Checking Account

Opening a free business checking account is simple and can be done by following these steps:

1. Gather the Required Information

Check with the bank for specifics. Generally, you'll need to provide:

  • Tax identification number: Corporations, partnerships and businesses with employees must use an Employer Identification Number (EIN), available from the IRS. Sole proprietors can use their Social Security number.
  • Government-issued photo identification: This can be a driver's license, state identification card or passport.
  • Personal information: Be prepared to provide your name, date of birth and contact information, as well as your business's name and contact information. If you're adding a business partner, employee or authorized signer to the account, you'll need their information as well.
  • Business documents: These can vary depending on your form of business, but may include your articles of incorporation, partnership agreement, business license or fictitious name statement.
  • Estimated monthly credit card sales: If you're planning to open a merchant services account to accept credit card payments, the bank will need this figure.

2. Complete an Application

Check with the bank to see if you can do this online or need to visit the bank in person. For in-person applications, anyone else who'll have access to the account generally needs to be present as well.

3. Make Any Required Minimum Opening Deposit

You can typically do this with a check, cash or electronic funds transfer from another bank account (have your bank account number and routing number handy).

Bank on Your Business

Banks generally don't perform a credit check when you open a business checking account. However, they will check your business credit score when you apply for a business credit card, line of credit or loan. If your business doesn't have an established credit history, they may check your personal credit score too.

You can begin building a business credit history by seeking credit from vendors and paying your business's bills on time. Regularly check your business credit report and your personal credit report to ensure they're up to date. Bringing late accounts current, reducing debt and making timely payments can help improve your personal credit score, potentially making it easier to access business credit and reach your business goals.