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How to Compare Business Bank Accounts

We take the hassle out of finding a business bank account that suits your company by showing you, at a glance, the top options available from different banks in one place.

• Browse our top business bank accounts

• Use the filters to find bank accounts offering the features your business needs

• Click ‘Get this Deal’ to find out more and apply

Switch Your Business Bank Account

Startup Business Bank Accounts

For a start-up, many banks will offer an introductory free banking period, which means that you won't face monthly charges for using the account for a set amount of time. However, other fees may apply.

What's important to note with startup bank accounts?

• Additional fees for paying with cash

• Do you need to make cash deposits and payments at a local branch?

• Is your branch local enough for you to get to for everyday banking needs?

• Many banks will offer support to start-ups, whether that is offering a mentor or someone to help with software

• Check any set-up and monthly fees to ensure that you're happy with the charges

• It's not always the best option to go with your personal current bank, unless you have done so already!

If you are stuck when it comes to choosing the right business bank account, our comparison service will help you find the best current account. Remember, once you have opened it, make sure you are reviewing it on an annual basis. Just like a personal account, you'll be covered by the 7-day current account switch guarantee.

Switching Business Bank Accounts

It's a fact that people are more likely to divorce their other half than switch their bank account. If you are worried about switching, then you shouldn't be as all business bank accounts are covered by a 7-day current account switch guarantee. As long as your bank is registered with this scheme.

What's important when switching business bank accounts?

• Don't just look at the free period, work out how much it will it cost after the fee free period

• Ensure you know the fees you will be charged per month or per activity to avoid surprises

• Switching can be done within seven days

• Make sure that those you bill are aware of the change of account details

Completing your application and switching providers is straight forward and your new bank will do most of the work for you - so you have no need to worry and can get back to what you do best. Standards of online banking vary and no one wants to go backwards when they are trying to move forward.

Help Getting a Bad Credit or No Credit Business Current Account

If you are having trouble setting up a business bank account or switching from your current one because your company has adverse credit or no credit history, then there are still options available where you can avoid credit checks.

What these types of business bank account typically offer:

• Debit cards

• Online banking

• The ability to pay into post offices or other establishments

• Potential improvement on your credit rating over time

• Quick setup and going to the branch is not required

Fees on this kind of business bank account may be due monthly or annually. Our bad credit bank account comparison tool is simple, easy to use and it can also be cheaper than a standard business bank account! Use our comparison service to see what's available for you.

Switch Your Business Bank Account

What is a Business Bank Account?

A business bank account is similar to a personal current account but is designed specifically for business transactions. Having a business bank account is a legal requirement in the UK for limited companies. Although sole traders and most partnerships and charities are not legally required to have their own business bank account, it’s good practice to keep personal and business finances separate. Having a business bank account will usually make it easier for business owners to apply for business loans or other financial products, along with the other features of day-to-day banking and having a record of business-related transactions.

Types of Business Bank Account

Every business is different and there are various types of business bank accounts that cater to companies in certain ways. Typically, the main types of business bank account include:

Traditional Business Bank Accounts

• Services offered by high street banks and some online-only providers

• Usually have a monthly fee

• Provide access to in-branch services as well as online banking

• Sometimes offer additional support services and advice to business customers

Free Business Bank Accounts

• Free business bank accounts have no monthly fees

• Are usually accessed and managed online or via a dedicated app

• May charge fees for some kinds of transactions e.g. paying in or taking out cash or exceeding a permitted number of monthly transactions

• Often have fewer features than other types of account

Small Business Bank Accounts

• Specifically designed for small businesses

• Often have an initial ‘free’ banking period without monthly fees

• Small business bank accounts usually have ongoing monthly fees once initial period is over

• Often include accounting software integrations with the bank account

Bad Credit Business Bank Accounts

• Offer bank accounts to businesses with some adverse credit history

• Offer bank accounts to new businesses with no credit history yet

• Business bank accounts for bad credit often have limited features and no overdraft facility

• May help businesses to improve their credit rating over time

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How Do Business Bank Accounts Work?

Business bank accounts work in a similar way to personal current accounts, but there are some key differences too.

• You can receive money from customers/clients into your business account

• You can make business-related payments from your account

• You can set up standing orders and direct debits for regular payments

• You can link up your business bank account with your company’s online accounting software to simplify record-keeping

• You can usually have debit cards linked to your company bank account to make business-related payments

• You can manage banking online or through an app

• Some business bank accounts offer in-branch services on the high street, or through the Post Office

What are the Pros and Cons of Business Bank Accounts?

If you’re unsure whether opening a business bank account is right for your circumstances, these pros and cons might help you to decide.

Advantages of business bank accounts

• Separates business income and related transactions from your personal finances

• Gives the business a more professional image

• Will help you to meet legal requirements if you are a limited company

• Can help make business bookkeeping and accounting more straightforward

• Can help build a credit history in your business name

• Will usually be necessary to have a business bank account if you want to access business loans or grants

• Helps with financial transparency and potentially limiting personal liability

Disadvantages of business bank accounts

• There may be monthly fees to pay for your business bank account

• Some business accounts charge fees for certain types of transaction or for exceeding your stated transaction limit

• There is some admin involved in opening and maintaining a business bank account

• Most business bank accounts that pay interest will offer a lower rate than personal savings accounts

Why Switch Business Bank Accounts?

There are several reasons why it could be a good decision to switch business bank accounts from your current one to a different provider or deal. These include:

• A new business bank account might offer lower (or no) monthly fees or lower charges for other transactions that your company regularly makes

• Your business may have grown or pivoted since you opened your existing account, so your needs may now be better met by a different bank

• You may be able to earn higher interest for in-credit balances from another provider

• A new provider might offer more convenience or additional services or features that you find useful, such as free accounting software

• Some banks have better customer service and support than others. You may want to switch to a provider with a better reputation in this area

The Current Account Switch Service (CASS) is something that you may have heard of for personal bank accounts, but it also applies to most business bank accounts too. It means that all banks signed up to the scheme will guarantee to transfer your old account balance, direct debits and standing orders to the new account within seven working days, leaving you with a lot less admin to do.

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How to Switch Your Business Bank Account

It’s very straightforward to switch business bank accounts using the Current Account Switch Service (CASS). You can use the steps outlined below:

Make Sure All Parties Agree to the Switch

If you are the sole owner of your business, it’s entirely your decision if you want to change bank accounts. If you are in a partnership, with your current business bank account jointly held with your partner, they will need to agree to the switch.

Find the Right Business Bank Account to Switch to

You can quickly compare business bank accounts on this page by features and types of account, to find the top accounts that meet your company’s needs and offer the best package available.

Check the Small Print

While the headline benefits of a new business bank account are important, it’s also essential to dig a little deeper to make sure that the account you want to switch to is going to work for your specific purposes. Some accounts have specific eligibility criteria that you’ll need to meet before applying.

Apply for Your New Business Bank Account

You can click through to your chosen bank account on this page, which will take you to an application page. Fill out all of the necessary information and you’re good to go. There are usually some checks for banks to make before they approve new account applications, but you should soon receive their decision.

Set a Switch Date

When your application has been approved, you can agree on a switch date with your new bank account provider and under CASS, they will handle everything else. You can sit back and wait for the switch to happen within the agreed timeframe.

What You Can Do to Help Make the Business Bank Switch Smoother

While CASS will ensure that your existing account balance, standing orders and direct debits all move over without you needing to do anything more, there are a couple of things you can do when preparing to switch which will also help things go smoothly.

• Go through all of your existing direct debits and standing orders and remove any that are no longer needed

• Make sure you get a full list of transactions and historical statements from your old bank before the switch date, as this information will not transfer to the new account

What Do You Need To Open a Business Bank Account?

There are several things that you will need to be able to open a business bank account in the UK. These can sometimes vary a little between providers, but most banks will want you to have:

• Personal proof of ID, such as a UK passport or driving license (original, not copies)

• Proof of address, such as a utility bill, correspondence from HMRC or your accountant

• Business documentation, confirming the business trading name, business address and certificate of incorporation (for limited companies), partnership agreement (for partnerships) and self-employed registration or tax return (for sole traders)

Information usually required to open a UK business bank account

• The trading address of the business

• Your personal residential address (for the past three years)

• Companies House registration number (if applicable)

• The date of incorporation (for limited companies)

• Tax information and business turnover (estimates are usually accepted for new businesses)

• Personal details of all directors or partners in the business

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How Do I Open a Business Bank Account?

Opening a business bank account is usually a very straightforward process.

• You can view the accounts that meet your business needs on this page and choose from these options

• Once you have chosen the business bank account that you want to apply for, click through to the application page

• Input the required information and submit your application

• Once some checks have been carried out, you will be contacted by the bank to let you know if your application has been accepted

• Once accepted, the bank will open your account for you and send you all of the necessary information on how to manage it, as well as helping you set up things such as ordering a debit card and how to activate services like online banking

Alternatives to Business Bank Accounts

While business bank accounts are essential for many types of company, there are some alternatives that some specific kinds of business may also consider. These include:

• PayPal, which enables online payments and can also send and receive invoices. There are fees for transactions when using PayPal for business purposes.

• Personal bank account, which is an option for businesses that are not limited companies. However, there are disadvantages to mixing personal and business finances, and some personal bank accounts do not permit any business transactions and can close your account as a result.

• Prepaid cards which can be loaded with money to make business-related payments. This can help keep business payments separate without having a full business bank account.

An important consideration is that alternatives to business bank accounts do not always have FSCS protection, so if this alternative company were to go out of business, your money could be lost. Business bank accounts that are covered by FSCS offer up to £85,000 protection per banking institution, reducing the risk of loss for businesses banking with them.

UK Business Bank Comparison FAQs

Can I switch business bank accounts if I’m in the overdraft?

It is usually possible to switch business bank accounts if your current business account is overdrawn, but typically only if you settle the overdraft with the old bank before the switch is completed. The Current Account Switch Service (CASS) will transfer over any credit balance to the new bank account, but will not transfer an overdraft balance.

In some cases, your new bank may offer an overdraft facility that can help you manage this transition, but this will usually be assessed on a case-by-case basis.

Do banks do credit checks before I open or switch a business account?

Most banks will conduct credit checks when a business applies to open or switch an account, especially if they offer overdrafts. They may do a credit check on the company director(s) as well as the business itself, to assess the level of risk of providing banking services to that specific company. 

There are some business bank account providers that don’t necessarily do credit checks for basic accounts, so companies with adverse credit or which are so new that they don’t have a credit history yet can still access this kind of service. Find out more about business bank accounts for bad credit.

Can I use my personal bank instead of opening a business bank account?

Unless you are a limited company (who are required by law to have a separate business bank account) then you are not legally obliged to have a separate business bank account, but it is very strongly recommended. Keeping personal and business finances separate is good practice and can help with bookkeeping and accounts.

It’s also important to note that some banks offering personal current accounts do not permit business transactions to be made from them and can shut down the account at any point in time if their terms and conditions are broken.

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