Kristina Fox
Duncan Ferris
Hannah SmithMany or all of the products and brands we promote and feature including our ‘Partner Spotlights’ are from our partners who compensate us. However, this does not influence our editorial opinion found in articles, reviews and our ‘Best’ tables. Our opinion is our own. Read more on our methodology here.
A business bank account is a current account designed for businesses, including sole traders, limited companies, partnerships and not-for-profit organisations – though some banks don’t cover all types of businesses.
There are many different accounts available, so it is important to pick the best business bank account for your needs. Finding the best business bank account for you doesn’t have to be difficult.
We’ve picked our top 10 business bank accounts based on our own research of the market as well as what business owners say are the most important criteria when searching for a business account. That includes monthly fees, easy account access and protection through the Financial Services Compensation Scheme (FSCS).
Virgin M Account for Business
For businesses with a turnover of less than £1million, the M Account for Business gives you free day-to-day online business banking for all your everyday needs.
Top 10 Best Business Bank Accounts
This selection of brands has been reviewed and evaluated by Nerdwallet, but others are available in the UK market. Find out what we mean when we say ‘best’, why we are comfortable using it, and an in-depth explanation of Nerdwallet UK’s review methodology.
Provider (select to learn more) |
NerdWallet’s Rating |
Monthly Fee |
UK Card Purchase Fees |
UK Bank Transfer Fees |
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|---|---|---|---|---|---|
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4.8 / 5
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Free
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Free
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Free
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4.7 / 5
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Free
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Free
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From free
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||
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4.7 / 5
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Free
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Free
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Free
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||
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4.4 / 5
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Free for 12 months
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Free
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Free
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4.4 / 5
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Free for 12 months
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Free
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Free
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||
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4.3 / 5
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Free for 30 months
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Free for 30 months
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Free for 30 months
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||
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4.3 / 5
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Free for 30 months
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Free
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From free
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||
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4.2 / 5
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Free for 12 months
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Free
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Free
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||
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4.2 / 5
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Free
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Free for 24 months
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Free for 24 months
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||
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4.1 / 5
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Free
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Free
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Free
|
Important Information: Our Reviews, Star Ratings and Editor’s Picks do not consider the product provider’s lending rates and therefore do not reflect how much it costs to borrow from the reviewed brand. Always compare rates from other providers when considering any type of borrowing.
Top 10 Best Business Account Providers
This top 10 is from 23 business bank accounts that NerdWallet evaluated and reviewed. Others are available. Find out how we use ‘best’ and our guide to ratings.
Monzo Lite Business Account
Free
Free
Free
n/a
- Available to sole traders, or the director of a registered limited company by shares (Ltd)
- Must be based in the UK
- Available to sole traders, or the director of a registered limited company by shares (Ltd)
- Must be based in the UK
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Ideal for anyone just starting out, Monzo Business makes it easy for you to set up a new account and start managing your money.
Monzo offers an array of business banking services from accounting software integration to ‘tax pots’. Just remember that you won’t have access to its full range of features unless you pay a monthly fee for its Pro account. For further details, read NerdWallet’s Monzo Business Account Review.
Monzo key features:
- Quick set-up: Most customers get an account on the same day, applying via the phone app.
- FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.
- Free UK transfers: Monzo offers free UK transfers for its business banking customers.
- 24/7 customer support: You can contact Monzo’s in-app customer support around the clock with urgent concerns.
| Monthly fee | Free |
| Transaction fees | Yes (cash deposits, plus ATM withdrawals outside EEA) |
| Account management | Online and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | Same day |
| Cash deposits | Yes (£1 at PayPoint) |
| Cheque deposits | Yes (free by post) |
Pros:
- There is a free business account available (Monzo Business Lite).
- Accounts can be accessed online or via Monzo’s mobile app.
- You may be able to get access to online banking on the same day as you apply.
Cons:
- It is not possible to manage the account over the phone or at a branch.
- Business accounts are not available to charities or partnerships.
Virgin Money M Account for Business
- Available for eligible businesses with up to £1m annual turnover
- Must be based and operated in the UK (excluding Channel Islands, Isle of Man and Northern Ireland)
- All owners, directors, senior managers and account signatories must be over 18 years old
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Virgin Money has a number of accounts to choose from, so there is likely to be something to suit your needs if your business is based in Great Britain.
Its M Account for Business has no monthly fees for start ups and small businesses with an annual turnover of less than £1 million. You can get cashback on debit card purchases and also apply for an overdraft. For further details, read NerdWallet’s Virgin Money Business Account Review.
Virgin Money key features:
- Account perks: There are a number of account perks, such as cashback when using your business debit card and discounts with selected retailers and merchants.
- FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.
- Charities: The bank has dedicated current accounts for charities and does not charge fees for every day banking if the charity has less than £1 million turnover a year.
| Monthly fee | Free |
| Transaction fees | No, for day-to-day banking. Yes, for other transactions |
| Account management | At a branch, via the mobile app, online and over the phone |
| FSCS protection | Yes |
| Average set-up time | 4 days |
| Cash deposits | Yes (90p per £100) |
| Cheque deposits | Yes (free via app) |
Pros:
- Virgin Money offers a free business account, M Account for Business.
- Eligible deposits of up to £85,000 will be protected by the Financial Services Compensation Scheme (FSCS).
- Virgin Money has a current account for charities, with no fees for everyday banking for charities with a turnover of less than £1 million a year.
Cons:
- Although Virgin Money offers 24-hour self-service over the phone, it does not offer 24/7 customer support.
- Virgin Money’s completely free M Account is only available for businesses with an annual turnover of less than £1 million.
- Virgin Money has no branches in the South of England, Wales or Northern Ireland.
Starling Bank Business Account
Free
Free
Free
n/a
- Must be a Limited Company or LLP registered at Companies House. General partnerships or charities that aren’t registered as a Limited Company aren’t supported yet
- All directors with access to the account must be UK residents
- Must be a Limited Company or LLP registered at Companies House. General partnerships or charities that aren’t registered as a Limited Company aren’t supported yet
- All directors with access to the account must be UK residents
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Starling has a free business bank account available to sole traders, limited companies and limited liability partnerships with no fees for basic transactions. Its apps have some of the best reviews in the banking market, which, coupled with 24/7 customer service, means it could be suitable for anyone looking for a cheap, easy-to-use business account.
Starling key features:
- No monthly fees: There is no monthly fee for Starling’s business bank account.
- Transactions: Everyday UK payments, such as Faster Payments, direct debits and standing orders, are free.
- FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.
| Monthly fee | Free |
| Transaction fees | No for Faster Payments, direct debits and standing orders, but fees may apply for other transactions |
| Account management | Online and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | One day (94% same day) |
| Cash deposits | Yes (Post Office) |
| Cheque deposits | Yes (free by app or post) |
Pros:
- The standard Starling business account comes with no monthly fee.
- You can make Faster Payments, direct debits and standing orders in the UK for free.
- Eligible deposits are covered by the Financial Services Compensation Scheme (FSCS).
Cons:
- Some account features are only available through its Business Toolkit, which costs £7 a month.
- You cannot manage your account over the phone or at a branch.
- Cash deposits at the Post Office carry a £3 minimum fee.
HSBC Kinetic Current Account
- You are the sole trader, or sole director and sole shareholder of the limited company
- Must be a tax resident in the UK but not the Channel Islands or the Isle of Man
- Maximum annual turnover of £6.5M
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
HSBC Kinetic is an app-based business bank account. The account is designed for sole traders and sole directors with an annual turnover of less than £6.5 million. It combines many of the benefits of an online-only business account (its app is one of the best reviewed) with the advantages of a traditional bank.
HSBC Kinetic key features:
- Introductory offer: There is no monthly maintenance fee for the first 12 months.
- Transactions: There are no charges for everyday banking transactions including direct debits, standing orders and other payments.
- Access to other banking facilities: Eligible customers can apply for a business overdraft or credit card. Similarly, you can apply for a HSBC Kinetic Small Business Loan worth between £1,000 and £10,000.
- FSCS protection: Deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
| Monthly fee | £6.50 (after 12-month free period) |
| Transaction fees | No for direct debits, standing orders and other payments. Yes for other transactions |
| Account management | Online, over the phone, in a branch and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | 2 days |
| Cash deposits | Yes (at a branch and Post Office) |
| Cheque deposits | Yes (via the app, at a branch or Post Office) |
Pros:
- HSBC Kinetic Current Account offers free direct debits, standing orders and other payments.
- Credit facilities: You may be able to access a business overdraft, credit card or the specific HSBC Kinetic small business loan.
- Eligible deposits are protected by the Financial Services Compensation Scheme (FSCS).
Cons:
- After the 12-month maintenance-fee-free period, HSBC Kinetic costs £6.50 a month.
- While you can make international payments at a branch and over the phone, you cannot make them on the app.
- 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.
Bank of Scotland Small Business Bank Account
- Must be a sole trader, partner or company director and be aged 18 or over
- Must have an annual turnover of less than £25m
- Must not already have a Bank of Scotland business account for this business
- A Guarantee may be required for Limited Companies and Limited Liability Partnerships
- Must be a sole trader, partner or company director and be aged 18 or over
- Must have an annual turnover of less than £25m
- Must not already have a Bank of Scotland business account for this business
- A Guarantee may be required for Limited Companies and Limited Liability Partnerships
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Bank of Scotland, part of Lloyds Banking Group since 2009, has a selection of current accounts for a diverse range of businesses – from start ups and larger businesses to professional practices and charities – you’ll have access to a selection of services, including accounting software and lending facilities. For more details, see NerdWallet’s Bank of Scotland review.
Bank of Scotland key features:
- Introductory offers: New customers pay no monthly fees for the first 12 months, in addition to free access to Bank of Scotland’s in-built accounting software.
- Branch access: With a network of branches in Scotland, you can manage your account in person as well as over the phone, online or via the app.
- Business support: Business account holders will have access to a UK-based management team.
- FSCS protection: Deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
| Monthly fee | £8.50 (after the 12-month free period) |
| Transaction fees | Yes (for certain transactions) |
| Account management | Online, over the phone, in a branch and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | 7 days |
| Cash deposits | Yes (85p per £100 using Immediate Deposit Machine, or £1.50 per £100 over the counter) |
| Cheque deposits | Yes (85p per cheque using Immediate Deposit Machine, or £1 over the counter) |
Pros:
- Introductory period of 12 months with no monthly maintenance fee or transaction fees for certain transactions for new customers.
- The account can be managed via the mobile app, online or over the phone.
- Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
Cons:
- There is an £8.50 monthly fee after the introductory fee-free period.
- With only one branch outside Scotland, Bank of Scotland may not be best suited to those who don’t reside there and are looking for face-to-face support, though you don’t have to be based in Scotland to apply.
- It takes, on average, seven days to open an account.
The Co-operative Bank Directplus Business Account
- Must be aged 18 or over
- Must be a UK resident with a business address in the UK
- Must be either a Sole trader or partnership, Limited liability partnership, Limited company
- Must be aged 18 or over
- Must be a UK resident with a business address in the UK
- Must be either a Sole trader or partnership, Limited liability partnership, Limited company
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Ethical and sustainable practices are key to The Co-Operative Bank so if these issues are important to your business, you may want to consider one of its accounts. What’s more, there are many different accounts to choose from, ensuring that there are options for small businesses, charities and larger companies.
The Co-operative Bank key features:
- Range of accounts: The Co-op Bank offers six business accounts, so there is an option suitable for almost every business type, including charities.
- FSCS protection: Your eligible deposits, up to £85,000 across all of your accounts, are protected by the Financial Services Compensation Scheme (FSCS).
- Access to overdraft and credit facilities: With a Co-op business account, you can apply for an arranged overdraft, a charge card for expenses, a credit card, and a variable rate business loan.
- Customer support options: The account can be managed online, over the phone, via the app and at a branch.
| Monthly fee | Free |
| Transaction fees | No |
| Account management | Online, over the phone, in a branch and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | 14 days |
| Cash deposits | Yes (£1.50 per £100) |
| Cheque deposits | Yes (£1.50 each) |
Pros:
- The Co-operative Bank offers multiple accounts with no monthly service fee, including a small business account developed specifically for members of the Federation of Small Businesses.
- Eligible deposits of up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
- You can manage your business account online, over the phone, via the mobile app and in a branch.
- You can apply for a business overdraft, credit card, charge card and loan.
Cons:
- The Co-operative Bank says that it can take, on average, 14 days to open an account.
- 24/7 customer service is not available.
- There are no branches in Northern Ireland.
TSB Business Plus Account
- Your business must be registered in the UK
- Must be 18 years or over
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
TSB is an established UK high street bank offering business banking to sole traders, general partnerships and private limited businesses. Your business must be registered in the UK.
The bank offers one everyday bank account for new business customers. Called the Business Plus Account, there is a monthly tariff (£5 per month) and some transaction fees after an introductory 30-month, fee-free period. For further details, see NerdWallet’s TSB Business Account Review.
TSB key features:
- Physical branches: TSB operates a network of branches across Scotland, England and Wales.
- 30 months’ fee-free: TSB’s 30-month offering is competitive since several banks offer 12 months only.
- Deposit cash and cheques: You can deposit cash and cheques into your Business Plus account via a branch or at any Post Office.
- Payment services app: Business Plus customers can access the Revenu app free for 12 months.
- FSCS protection: Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
| Monthly fee | £5 after 30-month fee-free period (waived if average monthly account balance is £10,000 or more over a charging period) |
| Transaction fees | Yes, for some transactions, after 30-month fee-free period |
| Account management | Online, app, phone, branch |
| FSCS protection | Yes |
| Average set-up time | 16 days |
| Cash deposits | Yes |
| Cheque deposits | Yes |
Pros:
- All new business customers benefit from 30 months’ free everyday banking.
- The account can be managed online, via the app, over the phone or at a branch.
- Eligible deposits of up to £85,000 are protected by the FSCS.
- There are branches in England, Wales and Scotland for face-to-face support.
- Business Plus customers can get the payment services app Revenu free for 12 months.
Cons:
- While it is possible for customers in Northern Ireland to open a TSB account, there are no TSB branches there.
- Once the 30-month fee-free period is over, the account will be subject to a £5 monthly fee (for accounts under £10,000), as well as some transaction charges.
- Customer support is not available 24/7 except for an automated chat service, so any urgent queries can only be answered via the chat’s advisers from 9am to 4.30pm on weekdays or by phone from 8am to 8pm, Monday to Sunday.
- Average set-up time of 16 days is among the slowest for business bank account providers.
HSBC Small Business Banking Account
- For small enterprises (including not-for-profits) with borrowing needs of up to £100k
- Must be a tax resident in the UK but not the Channel Islands or the Isle of Man
- Not available for sole trader or single director shareholder businesses
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
HSBC offers a range of business accounts for different needs, including an account tailored specifically for small businesses. These options are separate from HSBC Kinetic, which has its own dedicated app.
All of the HSBC business accounts provide free basic banking transactions, such as direct debits, standing orders and other payments. However, there will be a monthly fee once the 12-month free period (if applicable) ends.
HSBC key features:
- Free introductory offer: New business customers will benefit from 12 months’ free banking.
- Transactions: Everyday banking transactions are free with an HSBC business account.
- Account access: You can benefit from banking at a branch, as well as managing your account on the app, online or over the phone.
- Credit facilities: Business overdrafts, credit cards or loans may be available through HSBC.
- FSCS protection: Deposits of up to £85,000 are protected by the Financial Services Compensation Scheme.
| Monthly fee | £8 (after 12-month free period) |
| Transaction fees | No for basic payments, yes for deposits and other transactions (after free period) |
| Account management | Online, over the phone, in a branch and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | 5.4 days |
| Cash deposits | Yes (at branch and Post Office) |
| Cheque deposits | Yes (at branch and Post Office) |
Pros:
- Both the HSBC small business banking account and business banking account come with an introductory offer of 12 months of free banking for new customers, as well as free daily transactions.
- Accounts can be accessed online, via a mobile app, over the phone or at a branch.
- Eligible deposits are protected by the Financial Services Compensation Scheme (FSCS).
- You may be able to access a business loan through HSBC.
Cons:
- HSBC’s small business banking account business banking account both charge a monthly maintenance fee after the introductory period has ended.
- Its charity account charges a monthly fee as soon as you open an account.
- HSBC does not offer 24/7 customer service.
- HSBC says it takes on average 5.4 days to open a business bank account.
RBS Start Up Business Account
- Available to eligible customers over 18, who have the right to be self employed in the UK
- This ‘Startup business account’ is available for businesses that have been trading for less than 1 year and have a projected or existing annual turnover of less than £1m
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
RBS offers three accounts that only charge for what you use, meaning there is no fixed monthly fee.
In addition, the RBS Start-Up Account carries no transaction fees for the first 24 months, making it well-suited to new businesses. For more details, see NerdWallet’s RBS business account review.
RBS key features:
- Transaction fees: Opening a Start-Up Account means you will not have to pay transaction fees for the first 24 months.
- Additional features: You can also apply for a business overdraft, credit card or loan through an RBS business account.
- Account perks: Benefits include free access to FreeAgent accounting software and access to a dedicated relationship manager.
- Charities included: A range of charities and not-for-profit organisations can have access to RBS business accounts.
- FSCS protection: Eligible deposits up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
| Monthly fee | Free |
| Transaction fees | No, for the first 24 months. Yes, once the opening offer has elapsed. |
| Account management | Online, via an app, in a branch and over the phone |
| FSCS protection | Yes |
| Average set-up time | One day |
| Cash deposits | Yes (70p per £100, plus 70p per item outside free period) |
| Cheque deposits | Yes (70p per item outside free period) |
Pros:
- There are no transaction fees for the first 24 months when using a Start-Up Account.
- RBS claims that 87% of its customers open their business account in one day of their application.
- Eligible deposits of up to £85,000 are protected by the Financial Services Compensation Scheme (FSCS).
- You can manage your account in a branch, over the phone, online and via the app, with customer service available from call centres 24/7.
Cons:
- RBS is less well-suited to a business based in England or Wales, as unless you have an existing RBS business or personal account, you will be directed to open a NatWest account instead. Businesses in Northern Ireland, meanwhile, are directed to open an account with Ulster Bank.
- The RBS Start-Up Account – which offers 24 months’ transaction fee-free banking – is only available to businesses that have been trading for less than a year, and have a turnover of less than £1 million.
- After the end of fee-free promotional periods, all transactions from RBS business accounts carry a cost.
Mettle Business Bank Account
- For sole traders or limited companies with up to two owners
- Maximum balance of £1million
- You’ll need an iOS or Android device to open and manage the account
- For UK-based companies with owners who are UK residents and pay tax in the UK only
This product may be one of a range offered by this provider. Always check terms & conditions for suitability before applying.
Mettle business accounts are aimed at self-employed workers and limited companies with up to two owners. Accounts have no monthly fees or transaction charges. Mettle, which is part of the NatWest Group, also has one of the best reviewed apps on the market, making for a low-cost and simple-to-use account for everyday business banking.
For more details, read NerdWallet’s Mettle Business Account review.
Mettle key features:
- Business banking app: Mettle’s business banking app has excellent reviews on both iOS and Android devices.
- Sole traders and limited companies: You can only get a Mettle business account if you are a UK-based sole trader or a limited company with up to two owners.
- Deposits protected by FSCS: Eligible deposits are protected up to a total of £85,000 by the Financial Services Compensation Scheme.
| Monthly fee | Free |
| Transaction fees | No |
| Account management | Online, over the phone and via the mobile app |
| FSCS protection | Yes |
| Average set-up time | Within 72 hours (excluding weekends) |
| Cash deposits | Yes (via Post Office or PayPoint) |
| Cheque deposits | No |
Pros:
- Mettle business accounts are completely free. There are no monthly fees or transaction charges.
- Mettle’s business banking app is one of the best reviewed on the market.
- You can pay in cash at the Post Office (and also at a PayPoint for e-accounts).
- You can access Mettle customer support via the app or email and over the phone seven days a week.
- Eligible deposits are covered by the Financial Services Compensation Scheme (FSCS).
Cons:
- You cannot access your account at a branch.
- It’s not possible to pay cheques into a Mettle account.
- You cannot make or receive international payments with your Mettle account.
- You cannot access business overdrafts, credit cards or loans through Mettle.
- Business accounts are not available to partnerships or charities.
The pros and cons featured with each brand are chosen by us based on a combination of our expert, research-based opinions and an exclusive survey of UK business owners and decision-makers. The survey identified the business product features that people felt were most important. There are other pros and cons that should be taken into account before considering a financial product. Information was correct at the time of publication but may have changed since.
Nerdwallet Survey: December 2022
Top 10 Business Bank Accounts: Summary
This selection of brands has been reviewed and evaluated by Nerdwallet, but others are available in the UK market. Find out what we mean when we say ‘best’, why we are comfortable using it, and an in-depth explanation of Nerdwallet UK’s review methodology.
| Provider | Star rating | No. of accounts | Free account available?* |
|---|---|---|---|
| Monzo |  | 2 | Yes |
| Virgin Money |  | 4 | Yes |
| Starling | | 4 | Yes |
| HSBC Kinetic |  | 1 | No |
| Bank of Scotland | | 7 | No |
| The Co-operative Bank |  | 6 | Yes |
| TSB | | 1 | No |
| HSBC |  | 6 | No |
| RBS | | 3 | Yes |
| Mettle |  | 1 | Yes |
Important Information: Our Reviews, Star Ratings and Editor’s Picks do not consider the product provider’s lending rates and therefore do not reflect how much it costs to borrow from the reviewed brand. Always compare rates from other providers when considering any type of borrowing.
*We have defined free accounts as ones that do not charge a monthly or annual fee. This definition does not include business bank accounts that offer a fee-free introductory period; require a special status, such as a charity account; or have minimum turnover or balance requirements.
How business current accounts work
Business current accounts operate in a similar way to personal current accounts. Generally speaking, you can withdraw or deposit cash and make payments using a debit card, whether you’re shopping online or in a store. You can also accept incoming payments, transfer money to others, and set up standing orders or direct debits.
There are many options available, from online only to those with a high street presence, and from basic accounts to those with more complex add-ons. Many providers offer a free account as well as a paid one but, whichever you pick, you’ll likely be charged transaction fees of some sort. Below is a guide to what you should bear in mind when choosing.
Choosing a business bank account
Consider what type of business bank account you need and whether you want an online business account, a personal experience or a combination of the two. Then compare your business bank account options, taking the following factors into account.
Business bank account features
- Monthly fees: Some business accounts have a monthly fee, which may include some or all transactions. Others will charge transaction fees instead of a monthly fee, but a few don’t have any fees at all. It’s worth shopping around to see which pricing structure best suits how you would use the account.
- FSCS protection: The Financial Services Compensation Scheme (FSCS) protects deposits in bank accounts up to £85,000, so you will automatically get your money back up to this limit if your bank fails. If you are a sole trader, money in a personal bank account within the same banking group would count towards your £85,000. E-money accounts do not have FSCS coverage, though there are safeguarding rules in place to protect your money.
- Set-up time: Some providers can set up business accounts on the same day you apply, while others can take days or weeks to set up your account.
- Minimum balance requirements: Some providers may require you to keep your balance above a certain threshold to waive the account’s monthly fee.
- Individual transaction fees: You may be charged a fee per transaction with some business current accounts. These fees can differ depending on the provider and the type of transaction. Some accounts include a certain amount of transactions per month before individual fees then apply.
- Cashpoint access (withdrawals and deposits): Some providers will charge a fee for withdrawing cash at an ATM, at a branch counter or at the Post Office. Some may also charge for cash deposits, while others do not accept cash. It’s worth checking this if your business uses a lot of cash.
- Cheque deposits: Not all business account providers allow you to deposit cheques, while others will charge a fee for this service. If this is important to your business, bear this in mind when choosing a provider.
- International transfer and payment capabilities: If you’re looking to trade in other countries, you’ll need to find a business account provider that supports international payments. Not all providers support this, while others use a partner. Many that do allow payments abroad charge fees for this service.
- Incidental fees (stopping payments, insufficient funds, overdrafts): It’s worth noting whether your chosen provider charges for services, such as unarranged overdrafts or stopping a cheque (unless it is stolen). These fees will vary by provider.
- Online and mobile banking: Depending on how you want to access your account, you may want to check whether an account provider has online banking or a mobile business banking app.
- Additional features, such as integration with other business tools: Many business accounts offer integration with popular accounting software packages. Some providers also have offers where you can get free accounting software with a business account.
How to choose the best small business bank account
For small business owners, picking the right bank account can have a major impact on day-to-day operations. Some providers offer products branded as ‘Small Business Account” or similar which are specifically designed for new or small businesses.
These might include features like spending insight tools and access to business mentoring, as well as discounts or free access to other key products, such as accounting software and insurance.
The key thing to remember is to find the account that best matches the requirements of your small business.
For example, an account with no monthly fees might sound great on the surface. However, if everyday transactions carry costs and your small business requires a lot of buying and selling, you could find yourself paying a steep price.
You might even find that the best account for your small business is open to companies of all shapes and sizes.
Business Bank Account Methodology
NerdWallet evaluated and reviewed 23 business bank accounts from high street and digital-only banks. Collectively, these accounts represent the largest banks by assets and internet search traffic, along with notable or emerging players in the industry.
We considered more than 10 data points for each account, based on the criteria that matter most to users, scoring them on fees, accessibility and customer service, among other factors. This information was gathered from each financial institution’s website and company representatives. In addition, data is collected regularly and reviewed by our editorial team for consistency and accuracy.
Using the same data across all products and features we were able to create star ratings presented on a scale of one to five stars, where a one-star score represents ‘poor’ and a five-star score represents ‘excellent’.
Frequently asked questions about business bank accounts in UK
What you need to do to open a business bank account in the UK will vary depending on the account provider.
You can usually apply in one of the following ways:
- In a branch: Talk in person with a member of staff before applying.
- Online via the provider’s website: Apply from anywhere, and you could open an account on the same day.
Through a provider’s mobile app: Set up mobile banking and manage your account on your phone as soon as it’s open without having to wait for your card and account details in the post.
Sole traders can open a business bank account. Providers may offer you a specific sole trader account or a standard business account.
If you run a limited company or a limited liability partnership, no matter its size, you are likely to be able to open a business bank account.
Charities, clubs and societies may be able to open a business account. Eligibility is likely to vary between providers, so it’s worth shopping around if you’re looking to open a bank account for a not-for-profit organisation.
Some business bank accounts have strict eligibility criteria, such as minimum or maximum turnover or trading history. Providers may also have restrictions on which business structures and industries can open an account, so it’s a good idea to look through the terms of an account to make sure you’re eligible before applying.
Whether you legally need a business bank account depends on the structure of your business.
Limited companies and limited liability partnerships (LLPs) should open a business current account to manage their money and keep business and personal funds separate.
This is because your business is a separate legal entity to you, so you must have a duty to keep its finances away from your own. One of the ways to do this is by using a business bank account.
Not-for-profit organisations such as charities may find it useful to have a separate business account to manage their finances and keep accurate records of income and expenditure.
Sole traders can also open business bank accounts, though it’s not a requirement; sole traders can also use a personal account for their business.
Along with personal ID, proof of your residential address, and proof of your business address, you may also be asked to show evidence of your annual turnover or estimated income, such as your previous tax return or your business plan.
It can take anything from just a few minutes to a few weeks to open a business current account. It depends on the provider, and how long it takes to complete its checks.
Some providers offer accounts that are tailored for small or new businesses. These products often include additional extras that might appeal to small business owners, such as discounts on third party accounting software or access to business mentoring programmes.
However, small businesses will often be eligible for normal business accounts too, though there might be requirements based on turnover or how long you have been trading.
Review methodology
At NerdWallet UK, we base our reviews and our ‘Best’ pages on the results of surveys we undertook about what was important to people who use these products. This allows us to look at products impartially of any commercial arrangements we have and fairly rate the products on the same set of criteria.
Best means our ‘Best’ and is based only on what products we have aligned to our surveys, which form the basis of our reviews and ratings. This means that there will be other products on the market that we have not included in our ‘Best’ pages. Best does not mean it’s best for you, nor does it mean the ‘cheapest’.
Our reviews may display lenders’ rates. This additional information has not been included in our evaluations but is still very important when choosing a product. Rates offered can depend on circumstances, amount and term. Always check details before proceeding with any financial product.
Product details reflect the information that was available at that time but may have changed since. We strive to give you a review on as many products as possible, but there will be products not included on the market. The review is our opinion, but it does not constitute advice, recommendation or suitability for your financial circumstances.
You can view our full review methodology here.
Image source: Getty Images
Dive even deeper
6 Benefits of a Business Bank Account
Is it worth having a separate business bank account? Limited companies and partnerships legally need to have a business account, but it’s optional for sole traders. However, there are many potential benefits to opening a business account, as listed below.
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What is a Business Bank Account?
If you run a small business, you may need a separate bank account for it. But what is a business account and what can you do with one? Below, we look at what business bank accounts are and what they can offer you in detail.
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Why choose an online business bank account?
Online business bank accounts are inexpensive, convenient and easy to use. While they can differ from more traditional options, online accounts may offer extra services or functions that you won’t find at the typical high street bank.
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