The best start-up bank accounts in the UK
0
min read
When running a business, a bank account that best suits your needs is crucial, particularly if you’re just starting out. It’s vital to be happy with your business current account which, among other things, should be flexible, easy-to-use and convenient. Then there’s the cost. Every penny counts when you’re establishing a business, and that includes finding a bank account with reasonable fees and features.
While business bank accounts usually come with a variety of charges, many banks offer periods of fee-free banking to new customers. As a general rule of thumb, these accounts are aimed at small and medium-sized firms that are just starting out. There are other perks designed to draw people in such as online access coupled with phone or branch support.
As with other financial products, however, it’s important to keep an eye on the length of fee-free tariffs and check how much you’ll pay once the introductory offer comes to an end. If the costs go up considerably, it may be worth switching to another provider.
Here, we analyse 18 different start-up business bank accounts so you can compare and contrast to find the best one for you.
Every care has been taken to provide accurate info on each account provider. All facts and stats are right (according to the public websites) as of January 2020.
18 start-up and new business bank accounts for 2020
{{flexi-loan="/components"}}
Below, you can find the details of each bank’s plans and features. We've listed these in alphabetical order to help you navigate the bank account providers more easily.
1. Bank of Ireland Business Start-Up Account
- Transaction and maintenance fees waived for 24 months
- Dedicated Business Start-Up phone support line
- Exclusive access to the FCR Launch Online package
- Extended Enterprise programme for business support
- Access to free tools, guides and online support
- Access to workbenches located in Dublin, Cork, Limerick and Galway
With exclusive access to Bank of Ireland’s FCR Launch Online package, thisincludes a free custom-built webpage for 12 months plus a free .com domainregistry and GoldenPages.ie listing worth €425. The offer is only available to Bank of Ireland Business Start-Up customers.
2. Bank of Scotland Business Current Account
- 18 months of free day-to-day business banking (the usual monthly account fee is £6.50)
- Simple pricing and free electronic payments
- Business support available by phone, in branch or through online guides
- Dedicated support from its UK-based business management team
- Part of the same group as Lloyds Bank, similar terms and conditions apply to its business bank accounts (see section on Lloyds Bank).
3. Barclays Start-Up Business Account
12 months free day-to-day business banking for new business start-ups.Expert advice on helping new businesses get started and develop.
- Monthly loyalty reward
- Service guarantee
- Simple price plans
- Choice of two bank accounts
- Online banking
- Mobile banking app
- Business banking advisers available on phone or in branch
- Support to manage cash flow and payments
- Fee calculator
There are two price plans to choose from, designed for the way your business makes and receives payments. These are the Mixed Payments Plan, which is for businesses that use cash, cheques or a range of ways to make and receive payments, and the e-Payments Plan, for businesses that receive electronic payments and make payments mainly through online banking and debit cards.
The loyalty reward means that the bank pays back a proportion of the charges it applies to your current account on a monthly basis. For example, a business with an annual credit turnover of up to £99,999.99 which had been a customer for one to five years would receive 5%.
4. Cashplus
- Account options designed specifically for small businesses
- Immediate access to bank details
- 24/7 banking
- Award-winning bank account provider
- Mobile banking app
- Business current account comes with a Mastercard® Business Card
- Available to any type or size of business or organisation
This is simple banking and an alternative to a high street business bank account. There are no monthly account management fees, it’s free to receive banktransfers and there are no UK purchase transaction fees. There is one annual fee of £69.
5. Clydesdale Bank Business Current Account
- Free day-to-day business banking for 25 months
- Choice of accounts once the free period ends
- Access your account online, over the phone or in branch
- Mobile app
- Starting a business support tools and guides
- Support for running a business once established
Part of the same stable as Yorkshire Bank, Clydesdale Bank’s business currentaccount is much the same as the one on offer from Yorkshire. This includes the generous 25 months free day-to-day banking offer.
6. HSBC Business Bank Account
- Free banking for the first 18 months
- A Best Tariff Promise (a review of your account every year to ensure you’re always on the best standard tariff for your business)
- Access finance and borrowing to help fund your launch
- Access to business specialists in branches
- Tools and articles in the online Knowledge Centre
- Face-to-face business review
- Business internet/telephone/mobile banking
HSBC customers can make cash deposits, withdrawals or submit balance enquiries at any Post Office branch with their debit card. When the free business banking period finishes, a fixed price of £6.50 a month for the following 12 months will be levied. Customers can deposit up to £3,000 cash per month during this time. If they exceed this limit, the fee for further cash transactions is 0.50% of the value deposited.
7. Lloyds Bank Business Current Account
18 months free day-to-day business banking for new businesses. Dedicated support form UK-based management team.
- Simple pricing and electronic payments
- Mobile Business Banking app
- Online banking
- Various digital financial tools
- Small business support
An 18-month free banking period will be helpful for start-ups but bear in mind that when that 18 months is up, a monthly fee of £6.50 is applied as well as other charges. These include fees for cash payments (in or out and varying from 80p to £1 per £100), 65p for each cheque and 65p for credit in. Electronic payments, in and out, continue to be free.
{{flexi-loan2="/components"}}
8. Metro Bank Business Bank Account
No account fee if your daily balance stays over £5,000. Also, 50 free transactions per month if the balance is over £5,000. Accounts are available for new businesses including sole traders. 24/7 call phone banking from a UK-based call centre. Stores that are open seven days a week, 8am to 8pm weekdays
- Mobile app
- Online banking
- Support for start-ups and growing businesses
- Simple fee structure
- Simple account setup
When compared to some of the more traditional financial institutions, Metro Bank looks tempting. Its business bank account has been designed to support businesses with a turnover of under £2 million a year. The pricing is simple – it offers free banking to companies who maintain more than £5,000 in their bank account throughout the month. A fee of £5 per month is applied each month that the balance goes below £5,000. Some experts say it is one of the best business accounts around.
9. Mettle
- Available for balances up to £100,000
- No monthly or annual fee
- Single transaction limit of £10,000, weekly limit is £20,000, monthly limit is £50,000
- Cash withdrawal limitations of £400 per day and £4,000 per month
- Create and send invoices direct from your phone
- Not currently supported on Android
Mettle is a newcomer to the FinTech scene offering mobile first banking for those with balances up to £100,000. Launched by NatWest, their business current account can be opened in minutes and boasts fee-free banking.
10. NatWest Start-Up Bank Account
18 months free business banking, before standard published tariff applies(the minimum monthly charge is £5).
- Dedicated Start-up Package
- 24/7 online and telephone banking
- Bank anywhere with its mobile app
- Set up email and text alerts
- Access to servicing hub
- Gives customers a range of exclusive offers
NatWest’s start-up business account is available for businesses that have been trading for less than one year and have a projected or existing annual turnover of less than £1 million. The account also allows access to FreeAgent, an easy-to-use tool for business book-keeping. There is also free access to NatWest’s Receipt Management Tool. In addition, those who take out a business credit card won’t pay an annual fee for the first 12 months. After that, the annual fee is £30 per card issued. Similarly, once the 18 months free banking is up, a monthly charge kicks in as well as other fees for various types of transactions.
11. Royal Bank of Scotland Start-Up Bank Account
24 months free business banking before standard published tariff applies.
- Dedicated ‘Start-up package’
- 24/7 online and telephone banking
- Bank anywhere with its mobile app
Although many of the terms and conditions are the same as NatWest (which is part of the Royal Bank of Scotland Group), the RBS start-up account offers a longer introductory period for free business banking of 24 months. But during this time you will pay for unarranged borrowing, additional service and Bankline charges.
12. Santander Business Current Account
Free everyday banking for start-ups for 18 months (£7.50 standard monthlyfee). Standard day-to-day banking.
- 0.10% gross/AER (variable) monthly interest on your credit balance
- Access online, at Santander ATMs and Post Office branches
- Arranged overdraft (subject to status) representative 5.75% EAR (variable)
- Annual fee 1% of the agreed overdraft (minimum fee £50)
- Mobile banking app and telephone banking
With no monthly account fee for the first 18 months, this account is suitable for businesses in their first year of trading and also if it’s your company’s first current account with Santander. The ability to bank online, over the telephone or in a branch will also appeal to some people. In addition, Santander has won multiple awards for its business current account from financial experts.
13. Starling Bank
- No monthly or annual account fee
- Focused on small businesses and freelancers – but unlike others in this space, is regulated by PRA, FCA and has deposits protected by the FSCS up to £85,000
- No monthly fees for those with less than £1.7m in annual turnover
- Deposit money at 11,500 Post Office branches for £3 per deposit
- Integrate Xero, PensionBee, Wealthify and FreeAgent
- No fees to send or receive money via faster payments, direct debits and standing orders
- Flexible overdraft available
At first glance Starling's business offering is compelling – zero monthly fees and zero fees on domestic transactions. Aimed at owners of limited companies and the self-employed, Starling offers oferdraft facilities and plenty of business planning and accountancy tools.
14. The Co-operative Bank Business Directplus Current Account
- A market-leading 30 months of free everyday business banking for new business customers
- During the free period, no charges for all automated credits and cash withdrawals
- Deposit £2,000 in cash and 100 cheques per month for free
- Also during the free period, if you maintain a credit balance of £1,000 or more there is no monthly service charge, and all automated debits including standing orders, Direct Debits, Faster Payments, debit card payments and writing up to 30 cheques per month are free
- At the end of the 30-month free banking period, you’ll be automatically transferred onto its standard Business Directplus tariff with a £5 monthly charge
- Online banking and other features
If you prefer your banking to be ethical, The Co-operative Bank could be upyour street. Plus, that 30 months free period is hard to beat.
15. Tide
- A ‘pay for what you use’ approach
- No monthly or annual fees
- Using card at home and abroad is free
- Free transfers to Tide members
- Create and pay invoices through the app
- Share read-only access with accountant or finance team
- Cash deposits can be made at the Post Office for £1 per deposit, or at any PayPoint for 3% of the deposited amount
Tide enjoys a 8/10 score on TrustPilot. Because it’s not a high street bank, Tide users manage their account and access its services through the app. Designed for small businesses, freelancers, sole traders and established enterprises, business owners can account for free, and get a contactless MasterCard plus up to 35 team cards for employees. Iwoca is fully integrated into Tide, meaning its customers can apply to iwoca for business funding and get a decision without leaving the app.
16. TSB Business Plus Account
- 25 months of free day-to-day banking – so long as you keep your account within agreed limits and don’t go overdrawn without arranging it first
- Free Square Reader so you can take chip & PIN and contactless payments on the go (pay no fees on your first £1,000 of sales)
- Specialist support from Enterprise Nation and Funding Options
- Manage your account through its Mobile App, Internet Bank, telephone or network of more than 500 TSB branches.
- You can also deposit cash and cheques at 11,500 Post Office branches
- Its Business Debit Card allows you to withdraw money from an ATM and you pay no fees on transactions using your Debit Card
To help encourage firms to open a business account, TSB is offering customers a free Square Reader (worth £39), and 25 months of free day-to-day banking is a great offer. TSB also runs a daily text alert service to keep you in the loop on balances and payments.
17. Ulster Bank Start-Up Business Current Account
Dedicated account for small businesses in Northern Ireland (businesses mustbe registered in Northern Ireland).
- Start-up package
- 18 months transaction fee-free banking
- Mobile app and online banking
- Pay your bills with a Business Visa Debit Card
Ideal for business owners in Northern Ireland, Ulster Bank supports newbusinesses through its start-up package which is available to businesses that are registered in Northern Ireland, have been operating for less than 12 months and have a projected annual turnover of under £1 million. Remember that charges apply after 18 months.
18. Yorkshire Bank Business Current Account
- Free day-to-day business banking for 25 months
- Choice of accounts once the free period ends
- Access your account online, over the phone or in branch
- Mobile app
- Starting a business support tools and guides
- Support for running a business once established
- Unlimited deposits and withdrawals, subject to available funds
- Optional overdraft
- Personal attention and support from a member of our team
- Cutting edge digital tools
- Contactless, Apple Pay, Google Pay and a £700 daily cash withdrawal limit, subject to available funds
With one of the longest free day-to-day business banking offers on the market, this makes Yorkshire Bank’s business account very appealing and it is arguably one of the best business bank account for start-ups. This account is also a 5-star Moneyfacts-rated account. A cash limit (paid in, paid out or exchanged) of £250,000 per year applies. And, of course, charges will be applied once the initial 25 months is up.
While all this information may be a lot to take in, it’s important to take your time when setting up a business bank account - whether that’s a start-up bank account, a branch-based one or a product that is purely online. Top of your checklist should be the charges levied once the introductory fee-free period is over. And, whatever you decide to do, shop around first.
More on business bank products
