Best Business Savings Accounts

The best business savings account is the one that works best for your business.  The best account will be one that suits the type of banking transactions that your business does, and the size of your business.  In this article we’ll be considering business savings accounts suitable for small businesses.

What types of business savings accounts are available?

There are three main types of business savings account, designed for different transaction patterns and paying interest at different rates.

• Business transaction accounts handle everyday business transactions like cash deposits, cheque deposits, direct debits, electronic and telephone transactions, and cheque payments.  The accounts are designed to cater for a high volume of different types of banking transactions, and allow some free transactions.  Transaction accounts are intended for day-to-day business banking and don’t pay interest on any balance in an account.
• Business savings accounts handle a low volume of transactions of various types and allow a limited number of free transactions in the case of regular business savings accounts, or unlimited free transactions in the case of online savings accounts.  Business savings accounts often require a substantial deposit, typically $10,000, to open the account.  The accounts are useful to hold savings that are surplus to your day-to-day requirements but might need to be accessed in the near future.  They are intended to cater for some everyday banking and pay interest on the balance in the account. 
• Business term deposit accounts are intended as secure places to hold savings for a set period.  The accounts allow no transactions between the times are opened and closed so the funds in a term deposit account aren’t easily accessible until the term expires.  Business term deposit accounts pay interest on the balance in the account at more competitive rates than business savings accounts.

What savings accounts are best for small business?

When shopping around for banking solutions for your small business you first need to find a banking organisation that caters specifically for small businesses, before you investigate your chosen bank’s products that might suit you at this stage in the life of your business.

• Your choice of a banker is a primary consideration.  As a small business owner you need a bank and a bank branch that have an interest in the success of small business enterprises like yours and understand your banking needs.  Having found a bank you’re confident in, and feel comfortable with, you can start checking out the business savings account solutions it offers for your situation.
• If your business is in a start-up phase it needs bank facilities that help you to manage cash flow. An online  business savings account gives you 24 hour access to banking facilities, has low account and transaction fees, and has the bonus of paying you interest on the credit balance in the account. 
• If your business has outgrown the start-up phase and more funds are available you might consider opening a business savings account with a higher minimum deposit and paying higher interest.  For surplus funds waiting to be invested in your business development projects, business term deposit accounts are a secure place for cash that you don’t need to access in the short term.

You now have an outline of business savings accounts and their place in the life of a small business. To find out more about banks that offer banking solutions for small businesses view our comparison table here and follow the secure link to your chosen provider’s website.