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Where Can I Open a Business Bank Account Online? 7 Options to Consider
11
Min Read
Starting a business is hard enough – you don't need the added hassle of dealing with paperwork and long lines at the bank. Fortunately, thanks to the internet, you can now open a business bank account online in minutes.
In this blog post, we will provide a list of the best banks for small businesses, so you can get started quickly and easily. Let's get started.
Why do you need a separate business bank account?
There are plenty of reasons why you might want to consider having a dedicated business bank account, even if you’re a one-person operation. They include:
Helps you build up your business credit
If you ever need to take out a loan for your business, having a strong credit history will be essential. By using a business credit card and paying your bills on time, you can start to build up your business credit score. This will make it easier to get approved for loans in the future. Read more about how a business account affects credit score.
Separate personal and business accounts
Another key benefit of having a business bank account is that it helps you to keep your personal and business finances separate for taxes. This can make it much easier to manage your money, and it can also help you to avoid any legal problems down the road.
Builds credibility with vendors
When you have a dedicated business bank account and start paying your vendors with corporate checks, they’ll be more likely to view your business as credible and professional. That can lead to better terms, such as longer payment terms, and discounts for early payments.
Makes tax time a lot simpler
At the end of the year, you will need to file your taxes. Having a dedicated business bank account makes it much easier to track your expenses and income, as all of the relevant information will be in one place. This can save you a lot of time and hassle come tax time.
How to choose the right business checking account online
The first thing you need to consider when choosing a business checking account is the type of account that best suits your needs. There are three main types of accounts: basic, interest-bearing, and money market.
- Basic business checking accounts offer the simplest level of service and usually have no monthly fees.
- Interest-bearing accounts earn interest on your deposited funds, but they typically require a higher minimum balance.
- Money market accounts offer the highest interest rates, but they also have stricter requirements in terms of minimum balance and transactions.
Once you've decided on the type of account that's right for your business, the next step is to compare the fees and features offered by different banks.
When you're looking at fees, it's important to pay attention to both the monthly service fee and the per-transaction fees. Some banks charge higher fees for certain types of transactions, such as wire transfers or international payments.
When it comes to features, you'll want to consider what's important to your business. For example, if you frequently make large cash deposits, you'll want to make sure the bank you choose offers deposit slips. If you frequently travel for business, you may want to consider a bank that has branches in multiple cities or an account that comes with a debit card that can be used internationally.
Once you've compared the different options, it's time to choose the account that's right for you. Be sure to read the fine print and understand all the terms and conditions before you make your final decision.
How to open a business bank account online
Now that you've chosen the right bank and account for your business, it's time to open your account. The process is similar to opening a personal account, but there are a few key differences.
To open a business bank account online, you'll need to provide some basic information about your business, such as the legal name of your business, your business address, and your tax identification number. You'll also need to provide some personal information, such as your name, address, and Social Security number.
Once you've gathered all the required information, you can begin the account opening process. Research how much it costs to open a business bank account with an institution and decide where to create one.
The first step is to fill out an application -- this can usually be done online, but some banks may require you to print and mail in your application.
Once your application has been processed, you'll need to submit some documentation to verify your business. This may include your business license, articles of incorporation, or tax return.
After your documentation has been processed, you'll be asked to fund your account. This can usually be done by transferring funds from another bank account or by mailing in a check.
If you're having trouble, then the customer support team of the bank you're setting up your account with should be able to help.
It's important to note that, to set up a business account online, you'll need to be the legal owner of the business.
If you're not the legal owner, then you'll need to provide documentation proving that you have the authority to open and operate the account on behalf of the business.
There are a few things to keep in mind when you're using your new account. First, be sure to keep track of your transactions and balances so you can stay within your account's limits.
Second, remember to pay any fees or charges associated with your online business bank account on time. Failure to do so could result in late fees or other penalties.
By following these steps, you can open a business bank account online and start taking advantage of all the benefits it has to offer. With a little planning and research, you can find the perfect account for your business needs.
Where to open a business checking account online?
Now that you know how to open a business bank account online, you may be wondering where to open your account. Here are a few of the best online business bank accounts:
Bonsai Cash
Bonsai Cash is an easy-to-use checking account that allows you to manage, save, and spend your business funds with a minimum of hassle. The account offers you the convenience of digital banking solutions at a fraction of the cost.
Unlike traditional checking accounts, Bonsai Cash doesn’t charge you any monthly maintenance fees or transaction fees, and there are no opening requirements either. Yes, we are a no minimum business checking account.
The “Envelopes” feature makes it much easier to save more money and grow your business. You can create a few sub-accounts within the main account that you can use to set aside business funds. For instance, you can set up a “tax season”, ‘’business supplies”, or “emergency money” sub-account. You can technically have as many business accounts as you want.
You can even go a step further and allocate a percentage of your incoming funds to these sub-accounts. For example, you can assign 50% of your incoming funds to the “tax season” sub-account and the remaining 50% to the “business supplies” sub-account.
You can set up a guaranteed business account for your business using three simple steps:
- Create your account by providing your name, country, and currency
- Provide a few details about your line of work
- Apply for a free trial
Save more time and money by choosing Bonsai Cash as your dedicated business checking account. Open an account today.
Novo Business Checking
Novo business checking is a great alternative for small-business owners on the go since it offers no monthly fees, unlimited reimbursements for ATM expenses, and several mobile banking features.
Novo is compatible with hundreds of small business applications, such as Stripe, Shopify, and QuickBooks. For example, you can check your Stripe balance for client payments, transfer funds across borders with Wise, and monitor your QuickBooks transactions in real-time from your Novo account.
Novo also offers Novo Reserves, which are accounts that allow you to set money aside for particular reasons, such as taxes, payroll, or other expenditures. You can establish up to five Reserves in your Novo account for various spending plans and objectives.
That said, if you're searching for a bank that offers business savings accounts or interest-accumulating accounts, then you'll want to look elsewhere. Currently, Novo only provides a business checking account that doesn't pay out any interest.
Kabbage Checking Account
Kabbage Checking's greatest benefit is its above-average 1.10% APY for account holders. In comparison, typical banks usually provide low 0 percent to 0.01 percent APY on their checking accounts.
Users may also add funds to a “Reserves” account, which is similar to an enveloping account. You can organize your money for specific savings objectives or categories such as new business equipment or taxes in the "Reserves" section of the account.
You can withdraw cash for free at one of the 19,000-plus in-network ATMs across the country with the Kabbage Checking account. To help you locate the nearest ATM, there is an ATM locator in the Kabbage mobile app.
Kabbage does not charge a fee for any withdrawals made outside of its ATM network, but the bank whose ATM you're using can charge you a small fee.
There are no monthly maintenance fees or minimum balance requirements with the Kabbage Checking account. Traditional banks generally charge monthly account servicing costs between $10 and $29.95, so having no costs with Kabbage is already a significant advantage.
NBKC Business Checking
You have two business account choices with the mostly online-based NBKC Bank: the NBKC Business Account and the NBKC Business Money Market Account.
- The NBKC Business Account is a basic business checking account that's intended to keep your money safe for everyday use.
- The NBKC Money Market Account is a traditional savings account in which you can save extra money and earn interest on it.
You won't have to make an opening deposit when opening an NBKC Business Checking account. You don't have to maintain a minimum balance either, and the bank doesn't charge you any monthly fees. What's more is that transactions, incoming domestic wires, and check deposits are fee-free too.
You have access to over 32,000 MoneyPass ATMs across the country, and can get ATM fee reimbursements of up to $12 a month.
Axos Basic Business Checking
With Axos Basic Business Checking, you open a 100% online account and get benefits such as:
- unlimited domestic ATM reimbursements
- no monthly maintenance fees
- no minimum balance requirements
For any business incorporated after June 1, 2020, Axos offers a $200 bonus for opening an account. And for small businesses incorporated before that date, the bank offers a $100 welcome bonus.
You can redeem the $200 offer by using the code NEWBIZ200, and the $100 bonus using the code NEWAXOSBIZ.
There's a catch, though. To qualify for this welcome bonus, you need to maintain an account balance of at least $2,500 during your first two months with Axos.
You need to note that the bank has one major shortcoming, however. Unlike other online business checking accounts, Axos does not integrate with popular third-party business applications or apps such as invoicing software or online payment systems.
BlueVine Business Checking
BlueVine's business banking suite is made up of a single product, their online-based business checking account.
BlueVine Business Checking is a good option for small businesses that want to avoid monthly fees. This account has no monthly maintenance fees, and you can also avoid fees on transactions and incoming wires.
With minimal paperwork, you can open a BlueVine business bank account quickly and simply online.
The biggest benefit of this account, however, is its 1.2% APY, which is higher compared to other online banking solutions. For instance, Axos Business Checking offers an APY of 0.81%, and Kabbage Checking accounts earn 1.10% APY.
For your account to earn this interest, you need to have a balance of $100,000 or less.
Bank of America Business Checking
Bank of America offers a comprehensive suite of small business products and services, including checking and savings accounts, merchant services, credit cards, loans, and lines of credit. You can apply for most of these products online, and you’ll have access to the Bank of America business debit card, and mobile banking features with any account.
If you’re looking for a one-stop-shop for all your small business banking needs, Bank of America is a good option. However, if you want the highest interest rates on savings and checking accounts, you may be better off with another bank.
LendingClub Business Checking
The LendingClub Tailored Checking account, which allows you to earn interest and has unlimited ATM fee reimbursements, provides perks similar to those found in LendingClub's consumer banking services.
This online business checking account stands out, though, because it allows customers to make unlimited transactions, receive debit card rewards, and use convenient digital banking tools like bill pay and integrated invoicing.
To open the Tailored Checking account, you'll fill out an online form on the LendingClub website and provide information about yourself, your company, and any other company owners. Before submitting your application, you must also link an existing bank account or debit card to fund your new account, pending approval.
Once you've submitted your paperwork, the review process will take between two and five business days. You'll be able to access online banking and download the mobile app after you receive approval from LendingClub to create and manage your checking account.
Final Thoughts
A business bank account is a valuable tool for any business owner. It can help you manage your finances, make payments, and receive deposits.
By doing your research and carefully comparing the fees and features of different banks, you can find the perfect account for your business needs. Be sure to read the fine print and understand all the terms and conditions before you make your final decision.
What Defines a Verbal Contract?
A verbal contract (formally called an oral contract) refers to an agreement between two parties that's made —you guessed it— verbally.
Formal contracts, like those between an employee and an employer, are typically written down. However, some professional transactions take place based on verbally agreed terms.
Freelancers are a good example of this. Often, freelancers will take on projects having agreed on the terms and payment via the phone, or an email. Unfortunately, sometimes clients don't pull through on their agreements, and hardworking freelancers can find themselves out of pocket and wondering whether a legal battle is worth all the hassle.
The main differences between written and oral contracts are that the former is signed and documented, whereas the latter is solely attributed to verbal communication.
Verbal contracts are a bit of a gray area for most people unfamiliar with contract law —which is most of us, right?— due to the fact that there's no physical evidence to support the claims made by the implemented parties.
When is a Verbal Agreement Legally Binding?
For any contract (written or verbal) to be binding, there are four major elements which need to be in place. The crucial elements of a contract are as follows:
- Offer and acceptance: An offer is made and accepted by another party involved in the agreement;
- Consideration: The involved parties must exchange something of value (money, a service, time, etc), this is known as consideration;
- Intention and certainty: All parties must fully understand the terms of the contract and intend to make a legally binding agreement freely; and
- Capacity: The parties must have the capacity to legally enter into the contract; they're above age and of a stable mindset.
Therefore, an oral agreement has legal validity if all of these elements are present. However, verbal contracts can be difficult to enforce in a court of law. In the next section, we take a look at how oral agreements hold up in court.
How strong is a verbal agreement in court?
Most business professionals are wary of entering into contracts orally because they can difficult to enforce in the face of the law.
If an oral contract is brought in front of a court of law, there is increased risk of one party (or both!) lying about the initial terms of the agreement. This is problematic for the court, as there's no unbiased way to conclude the case; often, this will result in the case being disregarded. Moreover, it can be difficult to outline contract defects if it's not in writing.
That being said, there are plenty of situations where enforceable contracts do not need to be written or spoken, they're simply implied. For instance, when you buy milk from a store, you give something in exchange for something else and enter into an implied contract, in this case - money is exchanged for goods.
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get started nowWhen are verbal agreements not enforceable?
There are some types of contracts which must be in writing.
The Statute of Frauds is a legal statute which states that certain kinds of contracts must be executed in writing and signed by the parties involved. The Statute of Frauds has been adopted in almost all U.S states, and requires a written contract for the following purposes:
- The sale of real estate or vehicles
- Real estate leases lasting longer than one year.
- Property transfer following the death of the owner.
- The case of a party agreeing to pay debt for someone else.
- Any contract that requires more than a year to fulfil.
- A contract involving and exceeding a specified amount of money (which varies by state).
Typically, a court of law won't enforce an oral agreement in any of these circumstances under the statute. Instead, a written document is required to make the contract enforceable.
Contract law is generally doesn't favor contracts agreed upon verbally. A verbal agreement is difficult to prove, and can be used by those intent on committing fraud. For that reason, it's always best to put any agreements in writing and ensure all parties have fully understood and consented to signing.
How are Verbal Contracts Enforced?
Verbal agreements can be proven with actions in the absence of physical documentation. Any oral promise to provide the sale of goods or perform a service that you agreed to counts as a valid contract. So, when facing a court of law, what evidence can you provide to enforce a verbal agreement?
How can you prove an oral contract?
Unfortunately, without solid proof, it may be difficult to convince a court of the legality of an oral contract. Without witnesses to testify to the oral agreement taking place or other forms of evidence, oral contracts won't stand up in court. Instead, it becomes a matter of "he-said-she-said" - which legal professionals definitely don't have time for!
If you were to enter into a verbal contract, it's recommended to follow up with an email or a letter confirming the offer, the terms of the agreement , and payment conditions. The more you can document the elements of a contract, the better your chances of legally enforcing a oral contract.
Another option is to make a recording of the conversation where the agreement is verbalized. This can be used to support your claims in the absence of a written agreement. However, it's always best to gain the permission of the other involved parties before hitting record.
Written vs Verbal Contracts: What's the Verdict?
Fundamentally, most verbal agreements are legally valid as long as they meet all the requirements for a contract. However, if you were to go to court over one party not fulfilling the terms of the contract, proving that the interaction took place can be extremely taxing.
So, ultimately, the question is: written or verbal agreements?
Any good lawyer, contract law firm, or legal professional would advise you to make sure you formalize any professional agreement with a written agreement. Written contracts provide a secure testament to the conditions that were agreed and signed by the two parties involved. If it comes to it, a physical contract is much easier to eviden in legal circumstances.
Freelancers, in particular, should be aware of the extra security that digital contracts may provide. Many people choose to stick to executing contracts verbally because they're not sure how to write a contract, or they think writing out the contract terms is too complicated or requires expensive legal advice. However, this is no longer the case.
Say hello to digital contracts
Today, we have a world of resources available at our fingertips. The internet is a treasure trove of invaluable information, platforms, and software that simplifies our lives. Creating, signing, and sending contracts has never been easier. What's more, you don't have to rely on a hiring a lawyer to explain all that legal jargon anymore.
There are plenty of tools available online for freelancers to use for guidance when drafting digital contracts. Tools like Bonsai provide a range of customizable, vetted contract templates for all kinds of freelance professionals. No matter what industry you're operating in, Bonsai has a professional template to offer.
Benefits of written contracts
A written contract makes the agreement much easier to prove the terms of the agreement in case something were to go awry. The two parties involved can rest assured that they're legal rights are protected, and the terms of the contract are sufficiently documented. Plus, it provides both parties with peace of mind to focus on the tasks at hand.
Create Professional Contracts with Bonsai
Bonsai's product suite for freelancers allows users to make contracts from scratch, or using professional templates, and sign them using an online signature maker.
With Bonsai, you can streamline and automate all of the boring back-office tasks that come with being a freelancer. From creating proposals that clients can't say no to, to sealing the deal with a professional contract - Bonsai will revolutionize the way you do business as a freelancer.
Why not secure your business today and sign up for a free trial?
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