If you started a new business a decade ago, one of the tasks on your to-do list would be to open a business bank account at your local bank. That is still the case today, but businesses are also choosing to open other types of accounts to manage finances, send invoices and save time when it comes to bookkeeping.
The Benefits of Online Bank Accounts
These new online business accounts are often e-wallets or apps, and usually connected to your high-street business bank account.
They have so many benefits, including:
- They help avoid some bank fees, especially for businesses that send and receive foreign currency. If you have a lot of international customers or contractors, foreign exchange and payment fees can quickly add up.
- Some of these accounts have built-in bookkeeping, financial analysis features or can be connected to your accountancy software – such as QuickBooks – saving you time when it comes to taxes.
- There is increased safety by using some of these modern business banking accounts because they avoid the need to enter sensitive card information into websites.
- Most come with apps to help bosses and entrepreneurs manage their accounts on the move, between meetings or cups of coffee.
So, what are some examples? Today we have more than just PayPal business accounts…
The Best Modern Business Banking Options
Tide is one provider and offer free online business accounts that do more than your regular business account. From the accompanying app you can manage your account cards and even create categories for your money, such as category for your marketing department or a category that you deposit tax money into.
One of the flagship features of a Tide account is that it enables integration between your accounts and some accountancy software. You can combine them so any invoices and payments are directly and automatically recorded in your bookkeeping platforms, making tax time a doddle.
Starling provides personal and business banking solutions for modern businesses. From their app, you can track your financial performance with sophisticated analysis and create notifications on invoice payments. One of the coolest features of Starling is that it can help you deposit business cheques directly from the app.
It can also be connected to accountancy software and comes with overdraft options. Again, this option is 100% free and your account can be opened from home. Starling now offer a euro account which is ideal if your UK business ha European partners or customers.
Mettle is an online business account that is part of NatWest Bank. An online account with Mettle provides many of the same features outlined above, such as invoicing, account notifications and alignment with accountancy software.
But Mettle has a bigger reason to choose them. Their online UK business account is not just able to be integrated to accountancy software, they have partnered with FreeAgent to give you free access to one of the market’s leading accountancy software.
The only catch is you must make one transaction with Mettle each month. As long as you do that as most businesses would, your FreeAgent account will remain free!
4. Coconut Bank
Coconut Bank is the final of our top picks which is made for business banking. It does all that you have now come to expect from these types of online accounts and apps, but it does have a nice little extra that some of the competitors do not.
It can be connected to all of your other business accounts and keeps a running calculation of your current tax year performance. It doesn’t just automate bookkeeping for you, but it uses this information to predict how much tax, NI and VAT you will owe. Thus, helping you budget as you trade.
Not Sure Which One to Get?
If you are not sure which of these excellent online business accounts to choose, why not speak to your accountant and find out about the ones they use with their clients and recommend?
Using the one your current and trusted small business accountants already use will help make tax returns easier and save time.