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A customer-centric business approach focuses on customer experience一understanding and solving customer problems, optimizing customer flexibility, and offering convenience. This can help you attract and retain customers. One of the ways to achieve this is by offering several business payment options to help your clients pay for goods and services easily.

At Remitly, we’ve put together a helpful guide so you can understand the available payment methods and options for businesses in the United States.

Why business payment methods matter

Business payment methods allow you to receive payments from customers. They should provide a good customer experience by being reliable, secure, and efficient. 

They should also integrate well with your point-of-sale (POS)一a system that processes business payments securely and efficiently. It uses hardware and software to manage sales and record where and when a business transaction occurs.

Offering a range of business payment methods has several potential benefits:

• Increases customer satisfaction, flexibility, and loyalty because completing transactions is easier and more convenient.
• Increases sales because you can accommodate different customers with different transaction preferences. 
• Ensures better customer retention due to customer satisfaction.
• Improves efficiency, offering an alternative when a payment option fails.
• Offers security, especially when the customer is spending a large amount of money, because carrying large amounts of cash can be risky. 
• Streamlines transactions and improves cash flow.

Overview of different payment options for small businesses

Acceptable legal business payment methods in the US include:

• Cash
• Checks
• Bank transfer
• Credit and debit cards
• Mobile payments
• Cryptocurrency
• Digital wallets, e.g. Apple Pay and Google Pay.
• Buy-now-pay-later (BNPL)
• Online payments, e.g. PayPal
• Direct debit
• Electronic checks
• Contactless payments using Near Field Communication (NFC) technology

Understanding types of business payment methods

These business payment options work in different ways, so it might be worth supporting several for your business to increase efficiency.

Cash

Customers pay using cash in the local currency一$ USD in America. If possible, the customer may pay exactly as billed, or pay extra and receive the difference in change.

Although popular, cash payments put the business and customers at risk of theft and loss. Transaction management may also be confusing if you don’t use a POS system and forget to update your records after each sale.

Some people worry about hygiene because cash exchanges hands often, carrying germs and disease risk. This is one of the reasons cash payments were paused during the pandemic.

Despite these challenges, 90% of US consumers continue use cash.

Checks

Check payments are popular in the US, especially for business-to-business transactions. For example, if you sell chicken to a fast food joint, they can write checks to pay for the supplies. 

Unfortunately, check payments can sometimes make cash management difficult. Unlike cash, payments aren’t instant. It takes time to clear checks, even when you use the same financial provider. The average check clearance wait time in the US is two business days after you deposit it.

There is also an increased risk of fraud or refused payment if the payer makes significant errors when writing the check, such as not clearly writing the name or amount.

Checks can be expensive too. Issuing paper checks can cost up to $4 USD.

Bank transfers

Your customers may opt to pay via bank transfers in two ways一wire transfers or Automated Clearing House (ACH). Bank transfers are faster, safer, and more efficient than cash or check payments. It may be worth offering this option to retain and expand your customer base by attracting people who don’t like carrying cash or writing checks.

That said, being aware of the disadvantages will help manage your expectations.

• Some US banks charge expensive fees, especially for transfers between different banks.
• The receiving bank may hold the money until any issues are cleared or clarified. 
• Daily transaction limits may affect payments, leading to failed or late transactions, affecting cash flow.
• Transfers are usually irreversible. So it’s important your customers put in the correct details to avoid sending money to the wrong person.

Digital payment solutions

With digital payment solutions, customers send money electronically without handling physical cash. Payment options include online payments, mobile payments, credit or debit card transactions, and e-wallets.

Online payments

Online payments allow shoppers to pay via the internet when they shop online or at your store. They can use credit cards, debit cards, internet banking, wire transfers, and digital wallets.

Mobile payments

Mobile payment technology works similarly to online payments一you pay via the internet. However, there are a couple differences:

• Payment is made via mobile devices, e.g. tablets and smartphones.
• You will require a mobile application to access the services. For example, installing your bank’s app from the app store.
• You may use NFC or quick response (QR) codes to complete payments.

Credit and debit card payments

82% of consumers in the United States own a credit card, making it one of the most popular payment options. A credit card is a line of credit that banks float to users, allowing them to pay for goods and services, then pay the bank back at an agreed date. Usually, these cards have limits, so a buyer’s transaction may be declined if they’ve maxed out the card.

Unlike credit cards, debit cards don’t involve borrowing money. They are linked to a bank account, allowing users to access funds to pay for goods and services without physically visiting the bank or logging in online. These cards work as long as there are funds in the bank account.

You’ll need a POS terminal with a card reader and payment software to receive money from credit and debit cards for on-site transactions.

For mobile or online purchases, buyers can link their credit or debit cards to peer-to-peer payment (P2P) apps like PayPal or Venmo to send you money. P2P apps allow you to send and receive money digitally, at no cost, in most instances.

A detailed look into popular payment solutions

Business payment solutions offer ways for your business to receive money from different payment methods. These solutions can streamline your cash flow and improve customer satisfaction by providing convenient payment options. By incorporating features such as accepting credit card payments online, you can attract a wider audience and facilitate quicker transactions. Overall, implementing diverse payment solutions can lead to increased sales and enhanced business growth.

Solution 1: Payment processors and gateways

Payment gateways provide the technology needed to accept online payments. They securely collect information from customers as they make a purchase, then authenticate it. The customer enters their payment information, and the gateway safely sends the information to a payment processor.

The payment processor handles the transaction itself, and sends the money to your business. The gateway also communicates whether the transaction was successful or not.

A company can offer both services. For example, PayPal is both a processor and a gateway.

Consider payment processors and gateways to receive electronic payments from debit cards, e-checks, credit cards, and digital wallets.

Solution 2: Digital wallets and contactless payments

Digital wallets eliminate the need to carry credit and debit cards or cash. It’s an e-wallet that safely stores credit card and debit card information on your smartphone, allowing customers to make payments from it.

Payments are contactless, using NFC and QR code technologies.

Solution 3: Explore e-commerce and point-of-sale systems

How do businesses integrate their online and physical store operations for seamless accounting? It’s simple. They combine e-commerce and point-of-sale (POS) systems. 

An e-commerce system captures online transactions made via your website from anywhere, while a POS captures and stores information about physical store transactions made in person. Connecting these systems to your inventory manager can allow for seamless business operations and real-time management.

Choosing the best payment methods for your business

These different business payment options all have strengths and weaknesses that may affect customers’ experience.

It’s a good idea to consider these issues before settling on your preferred payment methods for your business:

• Business needs vs customer preferences: A customer-centric approach is good as it means you can offer payment methods that customers prefer. However, the choice should also make sense for your business. For example, although buy-now-pay-later (BNPL) arrangements increase sales and keep customers, they may not make sense at the growth stage of your business.
• Transaction fees: Businesses pass some fees on to customers, which are reflected in the final product or service fee. If you choose payment options that are too expensive, you may end up charging more than the market rate, losing customers in the long run. This may be risky for online businesses because customers can use online tools to compare prices and buy from the most affordable vendor.
• Security: Some payment options are more secure than others. For example, large cash transactions could present an opportunity for fraud. Unscrupulous customers can hide fake money within the real bunch, making you an unknowing accomplice in money laundering.
• Fraud protection: Cash payments are not the only way to get defrauded. Fake checks are a common type of small business scam in the United States. You also risk chargeback fraud with credit and debit cards, where a fraudster legitimately purchases from your business, later disputing the transaction with the bank claiming that the payment was unauthorized. Unfortunately, they may get their refund and still keep your goods.
• Efficiency: Bank transfers can cause issues when it comes to refunds. For example, it’s a good idea to understand how the refund process works and if customers can receive a refund if they pay the wrong business by accident.

The role of cost-effective and secure payment processing

As you consider the best options for your business, it’s worth considering the impact that cost-effective and secure payment processing can have on your business.

Find an business payment method that works for you, so you’re able to:

• Provide quick, efficient, and safe transactions, improving user experience and satisfaction.
• Reduce operational costs一both financial and security一via lower transaction costs and reduced fraud risk.
• Improve customer trust by securely processing their financial information.
• Increase compliance with local and international regulations such as the Payment Card Industry Data Security Standard (PCI DSS) that protects sensitive card data.
• Save time with automated processes.

Future trends in business payments

Payment technology is changing at a fast pace. It’s worth paying attention to the changes that are happening and anticipating what might happen to the business payment landscape in the next few years.

For example, we’re likely to see:

• More adoptions of emerging technologies like blockchain and cryptocurrency.
• Contactless and subscription-based payment systems will be more common.
• Investment in AI and machine learning in payments.
• Voice-activated payments. Home assistants like Siri and Alexa may be able to pay businesses via biometric authentication in the future.

Preparing your small business for future payment innovations

To prepare your business for these future payment innovations, it’s a good idea to streamline your operations, read widely to understand the current landscape, and embrace fintech solutions. If possible, invest in seminars and staff training to learn the best practices, cybersecurity, and prepare for the future.

FAQ

What are business payments?

These are processes or methods that businesses use to accept payment for goods and services.

What is the ideal payment method for a business?

It should be cost-effective, secure, and provide a good user experience. The best solution for your business will depend on your specific business needs.

How can small businesses take payments?

Payment methods include credit cards, debit cards, cash, checks, bank transfers, digital wallets, and mobile payments.

How should you pay for business expenses?

The best way depends on your specific requirements. Ensure that the method has low transaction costs, is secure, and keeps a record to facilitate proper financial management.

At Remitly, we understand that launching a small business is an exciting milestone, but it comes with many important decisions. One early decision involves choosing your business structure: Should you register as a sole proprietorship or a limited liability company (LLC)?

Each option offers different benefits regarding taxes, liability, and flexibility. For instance, sole proprietors retain full profits but carry personal responsibility for debts. LLCs offer personal liability protection, although they are subject to different regulations depending on the state.

In this article, we’ll describe both structures and discuss banking solutions suitable for LLCs and sole proprietorships.

Sole Proprietorship vs. LLC: What’s the Difference?

Sole Proprietorship

A sole proprietorship is owned and operated by a single individual without legal separation between the owner and the business. Profits belong entirely to the owner, but so do any debts or liabilities.

Currently, there are over 800,000 sole proprietorships in the U.S. This structure is typically suitable for lower-risk businesses like freelancers or small-scale entrepreneurs.

Advantages of a Sole Proprietorship:

• Quick, simple setup: Minimal paperwork and lower setup costs compared to other business structures.
• Tax simplicity: Business income is reported on the owner’s personal tax returns.
• Complete control: Owners make all business decisions without the need for partner or shareholder approvals.
• Easy to dissolve or alter: Changes to the business structure or dissolving the business involve minimal legal procedures.

Limited Liability Company (LLC)

A limited liability company (LLC) separates the business entity from the individual owners. It provides liability protection and avoids double taxation through pass-through taxation.

LLCs are highly popular in the U.S., comprising approximately 99.9% of all registered businesses, with about 34.8 million active LLCs.

Advantages of an LLC:

• Liability protection: LLCs protect personal assets from business debts and legal actions.
• Flexible ownership structure: Easily adjustable ownership arrangements accommodate multiple investors and partners.
• Pass-through taxation: Business profits are taxed only once at the owner’s individual tax rate.
• Customizable profit distribution: Members can agree on flexible profit-sharing arrangements.

Banking Solutions for Sole Proprietors and LLCs

What is a Banking Solution?

Most businesses manage their financial activities through business bank accounts, including checking and savings accounts, credit cards, loans, and financial management services.

Whether you’re a sole proprietor or an LLC owner, selecting an appropriate banking solution enhances your business operations and financial clarity.

Comparing Banking Needs of LLCs vs. Sole Proprietors

Choosing a suitable banking option involves understanding your business’s specific financial management needs and convenience requirements. Additionally, assessing the fees associated with different banking services can help you make a more informed decision. It’s important to evaluate the features each account offers, such as transaction limits and online banking capabilities. By taking these factors into account, you can choose the right business bank account that aligns with your operational needs. Additionally, consider the accessibility and support offered by the bank, as having reliable customer service can be crucial during urgent financial situations. Furthermore, utilizing modern banking tools can help streamline daily operations and maximize efficiency with online banking, allowing you to focus more on growing your business. Investing time in researching and comparing your options will pay off in ensuring that your banking partner truly meets your organization’s needs.

Benefits of a Separate Business Account

Maintaining a separate business account provides several advantages:

• Financial organization: Keeps personal and business finances separate.
• Professional credibility: Provides business-specific payment methods that enhance professional appearance.
• Business credit opportunities: Helps build relationships with banks to facilitate future credit access.
• Specialized business features: Access to tools like accounting integrations, spend control, and invoicing software.

Ideal Bank Account Features

An ideal banking solution differs slightly between sole proprietors and LLCs:

For sole proprietors, look for:

• Minimal monthly maintenance fees.
• Tools for invoicing and expense tracking.
• Mobile banking access.
• Instant transaction processing.
• No minimum balance requirements.
• Interest-bearing accounts.

For LLCs, prioritize:

• Accounting software integration (e.g., QuickBooks, Xero).
• Higher transaction limits.
• FDIC insurance.
• Low monthly maintenance fees.
• Mobile banking functionality.
• Various credit options.

Popular Business Checking Account Options

Several popular business checking account options frequently chosen by sole proprietors and LLCs include Bluevine, Grasshopper Bank, Relay, Chase, American Express, Wells Fargo, and Mercury. Each offers unique features tailored to different business needs.

Documents Required for Opening a Business Account

For LLCs:

• LLC formation documents.
• IRS-issued Employer Identification Number (EIN).
• Basic business information, including business address and founding details.

For sole proprietors:

• Business name and address.
• Employer Identification Number (EIN) or owner’s Social Security Number (SSN).
• Business license if required by the bank.

Effective Transaction and Payment Management

Efficient transaction management is crucial for small businesses to minimize payment failures and maintain smooth financial operations.

Key components of effective payment management include:

• Accounting and bookkeeping integrations.
• Invoice management and reconciliation features.
• Transaction analytics tools.
• Fraud and risk management tools.

FAQs

Should I register as a sole proprietor or LLC?
Your choice depends on your business goals. Sole proprietorships are simpler and less expensive but lack liability protection. LLCs offer more protection and flexibility, especially as your business grows.

What is the main difference between a sole proprietorship and an LLC?
Sole proprietorships have no legal separation between the owner and business, making the owner personally liable. LLCs provide legal separation, protecting personal assets from business liabilities.

Which business structure is riskier?
Generally, sole proprietorships are riskier because personal assets are directly at stake. LLCs offer liability protection, making them safer for business owners concerned about personal risk exposure.

Navigating business finances can feel overwhelming—especially when it comes to credit. Whether you’re just starting out or looking to scale, understanding how to build and manage business credit is essential for long-term growth. That’s why we’ve created this hub: a centralized resource designed to help small business owners, freelancers, and entrepreneurs make smart, confident decisions. From choosing the right business credit card to improving your credit profile and optimizing payment systems, our expert guides are here to support your financial success every step of the way.

Business Credit Cards Without Personal Guarantees

Discover how to separate personal and business finances with our guide on business credit cards with no personal guarantee. Ideal for entrepreneurs seeking to minimize personal liability while building company credit.

Best Credit Cards for Startups

Just launched your company? Learn which credit cards for startups offer the best rewards, flexibility, and tools to support early-stage business growth.

How to Build Business Credit

Lay the foundation for your company’s financial future with our step-by-step guide on how to build business credit, from establishing an EIN to managing vendor relationships effectively.

What Are Net-30 Accounts?

Improve cash flow and credit history with Net-30 accounts for businesses. This guide explains how these vendor arrangements work and how they support business credit development.

Best Credit Card Processors for Small Businesses

Compare the best credit card processors for small businesses to find the right fit for your industry, transaction volume, and budget.

FAQs

What is a business credit card and how is it different from a personal credit card?

A business credit card is designed specifically for business expenses and offers features like higher credit limits, expense tracking tools, and business-related rewards. Unlike personal credit cards, they help build your business credit profile rather than your personal credit.

Can I get a business credit card without a personal guarantee?

Yes, some business credit cards do not require a personal guarantee, meaning your personal assets are not at risk if your business can’t repay the debt. These cards typically require strong business credit or a proven financial track record.

How can I build credit for my business from scratch?

Start by registering your business, getting an EIN, opening a business bank account, and applying for credit with vendors who report to credit bureaus. Consistent payments and low credit utilization will gradually strengthen your business credit. Additionally, ensure that you keep detailed records of all financial transactions to maintain clarity in your business dealings. Leverage tools and platforms that make handling finances simpler, as this will also contribute to a solid credit profile. By streamlining financial operations, you’ll find that accepting credit card payments made easy can significantly enhance customer satisfaction and boost sales.

What are Net-30 accounts and how do they help build business credit?

Net-30 accounts let you purchase goods or services and pay the invoice within 30 days. Many suppliers report these payments to business credit bureaus, making them a useful tool for establishing credit history.

What’s the best credit card for a startup business?

The best credit card for a startup often includes low fees, flexible credit limits, and rewards that match your spending patterns. Cards that accept new businesses with limited credit history are especially useful.

How do I choose a credit card processor for my small business?

Look at factors like transaction fees, contract terms, payment methods accepted, and integration with your sales system. The right processor can reduce costs and improve customer experience.

Opening your first business bank account in the US can feel like a big step, especially if you’re new to the country. Having a dedicated account for your business helps you keep finances organized and makes running your company simpler. When you know what’s needed to open an account, the whole process will be a lot easier and quicker. 

At Remitly, we know that starting fresh in the US comes with lots of questions, especially about banking and money. We’re here to help you understand exactly what’s required to open a business bank account. We’ll also give you some tips to choose the best bank account for your particular business. 

What is a business bank account?

A business bank account is an account designed specifically for handling your company’s daily financial activities. Unlike your personal account, it includes helpful tools made just for business owners, like higher deposit limits, business-friendly credit cards, and easy ways to keep track of your expenses.

Why does opening a business bank account matter?

One of the best reasons to have a separate business account is to protect your personal finances. Having a business bank account is also more professional and helps you build trust with your customers, as they can pay directly to your business name rather than your personal account. 

If you plan to grow, it’s a great way to start building credit history for your business or DBA (“doing business as”) name. Plus, it makes record-keeping easy, which saves you stress and paperwork headaches when tax time rolls around. 

Types of business bank accounts available

Most banks in the US offer a few different types of accounts to match your business needs.

• Business checking accounts handle everyday tasks like receiving payments, paying bills, and managing expenses.
• Business savings accounts help you put money aside for future projects or unexpected costs.
• Merchant services accounts let you easily accept credit or debit card payments from customers.
• Multi-currency accounts are useful if your business deals with international clients or vendors, letting you send or receive money in different currencies without costly fees.
• Specialized accounts are for specific businesses like nonprofits or specialized industries.

Benefits of having a business bank account

Opening a business bank account gives you several advantages, especially if you’re new to running a business in the US. It makes your daily operations simpler, and it sets your business up for future growth and financial stability.

Keep your personal finances protected

Having a separate business account helps ensure that your personal expenses don’t get mixed up with your business costs. This clear separation makes it easier to manage your spending and budget accurately, giving you peace of mind and better control of your money.

With a dedicated business account, it’s much simpler to show what’s yours personally and what belongs to the business, which will reduce your stress as a business owner in complicated situations.

Make tax time easier

Tax season can be tricky, especially if you’re still adjusting to the US tax system. Keeping your business transactions in their own account helps you clearly track income and expenses, saving you hours of sorting through paperwork or bank statements when tax time comes around.

Plus, with a clear record of your business finances, you or your accountant can easily prepare taxes, reducing mistakes and possibly helping you qualify for valuable business deductions.

Build your business credit history

A dedicated business bank account helps you start building credit specifically for your company. This is particularly important in the US, as having good business credit can eventually help you get business loans, credit cards, or other types of financing to grow your business.

By regularly using your business account and managing your money responsibly, including paying bills and credit cards on time, you can strengthen your business’s financial reputation. In the long term, this makes it easier to work with lenders, negotiate better interest rates, and expand your operations smoothly. 

Essential documents needed

When you’re ready to open your business bank account, you’ll need to have some key documents. 

Employer Identification Number (EIN) and alternatives

Most banks will ask you for an Employer Identification Number (EIN). An EIN is a unique tax ID number given to businesses by the Internal Revenue Service (IRS). There are a few numbers that banks will typically accept.

• EIN—needed for most business types like LLCs, partnerships, or corporations
• Social Security Number (SSN)—usually accepted for sole proprietors (single-owner businesses) who don’t have an EIN
• Individual Taxpayer Identification Number (ITIN)—accepted by some banks for international business owners who don’t have an SSN

Always double-check with your bank first to confirm exactly which ID numbers they accept.

Proof of business formation

The bank will need to see official documents that show how your business is legally set up, like Articles of Incorporation for corporations, Articles of Organization for LLCs, or a Partnership Agreement for partnerships. 

If your business operates under a different name, you’ll also need to provide a DBA certificate or registration. These documents help the bank clearly identify your business type and ensure everything complies with US regulations.

Personal identification

In addition to your business information, you’ll need to provide personal identification documents for anyone who owns or manages the business account. This usually includes a valid driver’s license, passport, or state-issued ID card, and a Social Security Number. If you don’t have a Social Security Number, some banks accept an ITIN or other identification documents—just ask ahead to be sure.

Business licenses and permits

Depending on your location or type of business, you might need to show licenses or permits that allow you to operate legally. Common licenses and permits include a general business license, sales tax permit, health permit (for restaurants or food businesses), liquor license (for bars or businesses selling alcohol), or a professional license (for businesses such as accounting firms, salons, and contractors). 

Steps to open a business bank account

Follow this step-by-step process to open your business bank account in the US.

Gather your documents

Before applying, make sure you have these important documents:

• Employer Identification Number (EIN), or your SSN/ITIN if your bank accepts it
• Proof of business setup, such as Articles of Incorporation, LLC documents, or your DBA (“doing business as”) certificate
• Business licenses or permits that are needed for your type of business
• A government-issued photo ID, like a driver’s license, passport, or state ID card

Some banks might ask for additional documents, especially if your business structure is more complicated (like a partnership or LLC), so always double-check their requirements.

Choose the right account for your business

When you’re picking the best business bank account, consider your everyday needs and what matters most to you. Compare the features banks offer, like business credit cards, multi-currency accounts, or merchant services if you need to accept credit card payments.  Additionally, think about the accessibility of funds and the quality of customer service provided by the bank. Understanding how to select a business bank account will help you identify options that align with your financial goals and support your business operations effectively. Finally, consider any fees associated with the account, such as maintenance or transaction fees, to ensure you’re making a cost-effective choice.

Complete the application process

1. Apply online or in person: Many banks allow you to start the application process directly on their website, but some will require you to visit a local branch.
2. Submit your documents: Provide your business documents and personal identification, either by uploading them online or showing them at the branch.
3. Make an initial deposit: Most banks require an initial deposit, which you can usually make electronically or in person.
4. Wait for approval: The bank will check your details and paperwork, confirm everything is correct, and then finalize your new account.
5. Start using your account: After approval, you can order checks, get your business debit or credit card, and begin managing your day-to-day finances easily.

Tips for choosing the best business bank account

A good business bank account doesn’t just store your money, it also helps you manage your finances and ensure everything runs smoothly. Think about your business routine. How many transactions do you expect each month? Do you need special payment services? These are important considerations when choosing the right account for your needs.

Compare account features and benefits

It’s always worth checking out several banks before making your decision. Some banks are especially welcoming to small businesses, offering perks like accounts with no monthly fees, easy access to loans, or higher limits on deposits and transactions.

Look for banks that offer useful extras, like cashback or reward programs linked to business credit cards. These benefits can add up quickly, especially if your business regularly makes larger purchases or involves frequent travel.

Make sure online banking is simple and reliable

Being able to handle your banking online or through a mobile app is very useful, especially if you’re busy or don’t live close to a branch. Look for online tools like remote check deposits, easy invoicing, bill payments, and fast online transfers to save yourself time and hassle.

It’s also helpful if the bank offers solid customer support, ideally 24/7, so you can quickly solve any issues even outside of business hours. Another tip is to check what kind of fraud protection services the bank provides to keep your business safe from online scams or unauthorized transactions.

Pay attention to fees and balance requirements

Fees can vary a lot from bank to bank, so pay close attention. Some banks charge monthly fees unless you maintain a certain balance, while others may charge for transactions, ACH transfers, or wire transfers. 

Selecting an account that aligns with your cash flow habits can help you avoid unnecessary charges and save money over time. Also, check if the bank offers ways to waive fees, such as keeping a certain minimum balance or having regular direct deposits. 

What newcomers should know about business bank accounts

If you’re new to running a business in the US, understanding how business bank accounts work can help you avoid confusion and make your setup process easier. Here are a few things to keep in mind.

You don’t need an LLC to open an account

An LLC (Limited Liability Company) is a popular choice, but it isn’t the only type of business structure accepted by banks. Sole proprietors, general partnerships, and other business structures can also open business accounts, as long as they provide the right paperwork and identification. When considering options for business bank accounts for sole proprietorships, it’s essential to gather all necessary documents, such as a business license and social security number. Banks typically evaluate the personal credit history of sole proprietors during the application process. Understanding these requirements can help streamline the account opening experience and ensure compliance with banking standards.

Approval is usually simple if you’re prepared

Most banks make the approval process straightforward, especially if you have all your documents ready ahead of time. Having your EIN or tax number, business formation paperwork, licenses, and identification ready can speed things up significantly, making it easier for you to get started quickly.

Opening an account can help you accept more payment options

Having a business bank account means you can more easily accept credit cards, debit cards, checks, and online payments directly into your business. This flexibility makes transactions easier for both you and your customers, helping you build a stronger business right from the start.

FAQs

What documents do I need to open a business bank account?

You’ll usually need paperwork showing your business setup (like LLC or corporation documents), a government-issued ID (such as a driver’s license or passport), and your EIN or tax ID number. If you have any business licenses for your type of business, bring those along too.

What types of business licenses might I need to open my account?

Depending on your business, you may need licenses such as a sales tax permit, health department permit, liquor license, or professional licenses for fields like construction or cosmetology. Check your local city or state requirements to see exactly what’s necessary.

Is a multi-currency account necessary if my business deals internationally?

A multi-currency account isn’t required, but it can make international transactions easier and cheaper by letting you manage multiple currencies without high conversion fees. Consider this option if you frequently receive payments from other countries.

What should I do if I’m not sure which bank to choose for my business?

Start by thinking about what’s important for your business, such as fees, online banking features, or branch locations. Comparing options online or speaking directly with different banks can help you make the best decision.

Running a small business comes with countless decisions, and where you choose to bank can have a big impact. Credit unions can offer competitive advantages over traditional banks, including lower fees, more flexible lending options, and a customer-first approach that can make a significant difference in terms of your bottom line.

At Remitly, we understand that small business owners need to work with financial partners who prioritize their growth and success. That’s why we’ve created this guide to help you navigate the benefits of credit unions for small businesses. Whether you’re launching something new or growing your existing business, this article can help you make an informed decision about the best banking option for your company.   Credit unions offer unique advantages, including personalized service, lower fees, and competitive interest rates, making them ideal partners for small business banking essentials. By choosing a credit union, you can access financial resources tailored specifically to your needs, helping to ensure your business remains agile and successful in a dynamic market. Explore the various services they provide, from loans to savings accounts, and find the perfect fit for your business aspirations.

Exploring business accounts with credit unions

Credit unions can be a compelling alternative to conventional banking, offering advantages worth exploring for entrepreneurs and small business owners. 

Choosing a business account at a credit union instead of a bank has a variety of advantages, including:

• Lower fees and costs, both to set up and maintain your account
• Flexible loans with lower interest rates
• A more personalized customer experience
• Savings accounts with higher interest rates

How credit unions differ from commercial banks

The biggest difference between credit unions and commercial banks is their structure. Most commercial banks are for-profit and owned by shareholders. Their ultimate goal is to generate returns for those shareholders, not offer customers the best options. 

Anyone can set up an account with a bank, and they usually offer many different banking products to businesses. Most banks have many branches and ATMs across the country. They usually also have a full suite of investment and saving products and services. 

On the other hand, credit unions are nonprofit and fully owned by their members. Any earnings are reinvested into benefits for members, like lower interest rates, better services, and higher dividends. Members can also vote on a credit union’s policies.

Unlike banks, credit unions have membership requirements. Local credit unions may limit members to constraints like a school, place of worship, or geographic area. National credit unions, however, may have broader requirements as they want to increase membership.

Credit unions usually have significantly fewer ATMs and branches than commercial banks. However, most credit unions form part of the CO-OP shared branch network of more than 30,000 ATMS and 5,000 branches. Members of any participating co-op can use the ATMs with no fees and perform many in-person operations at any of the branches. 

Historically, credit unions have offered more limited banking services geared towards moderate-income individuals. They also face greater limitations than commercial banks on things like investing and business banking due to regulations. However, more credit unions are offering business services at competitive rates. 

Deposits in both credit unions and banks are federally insured for up to $250,000. Banks are insured through the FDIC and credit unions are insured through the NCUA. 

Business checking accounts: a key offering

Many credit unions offer both business checking and savings accounts. Checking accounts are great for small businesses that want to increase their business professionalism, organization, and legal protection.

While their exact features may vary, most business checking accounts at credit unions offer:

• Digital banking app access
• Mobile check deposit
• Payroll direct deposit
• Wire transfers
• Ability to grant others account access
• Electronic statements
• Low or no monthly fees
• Dividends
• No or small deposit to open
• Up to a certain amount of free check deposits per month

Benefits for small business owners

A business checking account can be a great benefit for small business owners. Some of the biggest benefits include:

• Separating business and personal income and expenses
• Bookkeeping and merchant services integration
• Simplified tax planning and maximized deductions
• Easier to get a small business loan or line of credit

Requirements for opening a business checking account

When you find the right credit union for your business, you’ll need to fulfill certain requirements to open a business checking account:

1. Make sure you’re eligible for membership. While many credit unions restrict membership to a certain area, some credit unions let anyone become a member by donating a small fee to a partner association or foundation. 
2. Collect the required documentation. This may include:
   • Your Social Security number or Business Tax ID
   • Legal business name and DBA (doing business as) name
   • Date of business establishment
   • Government-issued personal ID, such as a driver’s license
   • Business formation documents
   • Ownership agreements
   • Any necessary documentation to support your eligibility
   • Relevant bank statements if you’re moving your account from another financial institution
3. Depending on the credit union, you can either submit an initial application online or go to your local branch to meet with the branch manager or relationship manager. At this meeting, you’ll also discuss your needs so the credit union knows how to best serve you.

Using branch and online banking services

Most credit unions have both local and online banking options. While credit unions often only have branches in a specific region, there are some larger ones that offer nationwide services.

As previously mentioned, many credit unions are part of a shared branch network. This means that most in-person functions can be performed at potentially thousands of different credit unions across the country. However, more specific services like business planning may sometimes only be done at a branch of your actual credit union.

Almost every credit union has online or mobile banking, either through a website, an app, a phone line, or all three. Typically, you can use these channels to:

• Check account balances
• Transfer funds
• Pay bills
• Deposit checks
• Add bill payees
• Find ATM and branch locations

However, the range of online banking services depends on your credit union. 

Financial solutions and business services

While not every credit union offers the same full business service suite as banks, more and more of them are offering an expanded range of financial services for you and your business. In fact, in 2023, 62% of credit unions said they were planning to expand their business services and target a business niche over the next few years.

Beyond business checking and savings accounts, many credit unions offer some or all of the following business and financial solutions: 

• Competitive business credit cards
• Term loans
• Small Business Administration (SBA) lending
• Lines of credit
• Real estate loans and development
• Payroll processing and management services
• Merchant services
• Educational resources like workshops and business advisors

Business savings for small firms 

As previously mentioned, since credit unions are nonprofit and member-owned, their goal is to serve you best, not maximize revenue.

Credit unions can help you save money by offering fewer fees than a bank, lower credit card interest rates, and more flexible loans with lower interest rates. As credit unions tend to have a more personal relationship with customers than large commercial banks, they work with you to find the best solutions based on your business’s current financial situation. 

Member returns come in a variety of forms. From increased dividends to even lower interest rates to enhanced services, as credit unions grow and expand, your benefits may, too. Local credit unions also reinvest funds within the community, which can additionally fuel small business growth in the area. 

Investment opportunities and tailored business solutions

Depending on the size of your credit union, many also offer mostly low-risk investment opportunities for both personal and business accounts. This can include:

• Financial advisors
• Certificates of Deposit (CDs)
• Bonds
• Mutual funds
• Self-directed online investing
• Money market accounts (MMAs)

Like with their other services, credit unions usually treat investing as a relationship with your business and work with you to build a portfolio tailored to your needs and risk appetite. 

Credit unions also might offer business planning services. Their associates can work with you directly at your local branch to help you develop financial literacy, evaluate your business, and create a business plan.

Top credit unions for business needs

If you think a credit union is right for your business, here are some of the top credit unions that frequently work with businesses, along with their membership requirements and benefits. 

Evaluating credit unions based on business solutions

When choosing a credit union to open an account for your small business, there are important considerations to take into account based on your business and its needs, including:

• Regular service fee amounts
• Minimum required account balance
• Yields and dividends
• Loan options and repayment plans
• Online and mobile banking
• Branch and ATM access
• Specific financial services, like payroll services or business planning

A summary of leading credit unions for small businesses

While the best credit union for you depends on your business’s situation, some credit unions are recognized for offering strong business banking services.

Notable Pick: Affinity Plus Federal Credit Union

• Membership qualifications: Live, work, study, or worship in eligible regions, be affiliated through a family member or employer, making a one-time $25 donation to the Affinity Plus Foundation
• Features: Over 60,000 nationwide ATMs, CDs, MMAs, no-fee business credit cards, vehicle and real estate loans, lines of credit, coin services
• Potential drawbacks: Limited branches (specific to the state of Minnesota), low checking and savings account yields

For a wide range of financial services: America First Credit Union

• Membership qualifications: Live, work, worship, volunteer, or study in eligible regions, employees or members of their select employer group or family of current members
• Features: Business credit card with rewards, loans, non-profit business accounts, merchant processing, payroll services, business bill pay, remote deposit, automated clearing house (ACH) services, wire transfers, business planning, business registration services, Zelle money transfer service
• Potential drawbacks: Somewhat narrow field of membership

For investing: Consumer’s Credit Union

• Membership qualifications: Become a member of the Consumer’s Cooperative Association with a $5 membership charge, which CCU will reimburse. Your company must do business in Illinois or Wisconsin, and you must open a business account in person.
• Features: Business MMAs, credit cards, four types of  high-yield checking accounts, better interest rates the more your account is used, national ATM network, business bill pay, ACH services, check fraud protection, merchant services, commercial lending, lines of credit
• Potential drawbacks: Geographically limited membership, having to open an account in person

For flexibility and scalability: Credit Union 1

• Membership qualifications: When applying online, Credit Union 1’s system will determine if you are within its field of membership. If you’re not eligible, you can also apply for membership under the Credit Union 1 Educational Development Association with a $5 donation. There’s a one-time $5 membership fee and a $5 initial account deposit.
• Features: Online bill pay and treasury management, sweep accounts, SBA lending, business credit cards, CRE loans, 90,000 ATMs, and 5,000 shared branches, three scalable business checking account options
• Potential drawbacks: High ABD to waive monthly fees, low checking and savings account yields

For saving: Digital Federal Credit Union

• Membership qualifications: Those who live, work, worship, or study in its field of membership, work for or with eligible employers, organizations, and homeowners associations, family of any current member
• Features: High-yield savings accounts, variety of loans and lines of credit, technology-forward, MMA savings accounts, IRA certificates for employees, unlimited check writing, 20 free deposits per day, $0.01 ADB required, large nationwide ATM network
• Potential drawbacks: No business credit cards

For military and their families: Navy Federal Credit Union

• Membership qualifications: US military service members, veterans, Department of Defense (DoD) personnel, and their families. Business checking accounts must deposit a minimum of $250 (sole proprietorships) or $255 (other legal entities) when opening an account.
• Features: Largest credit union in the country, competitive yields for checking and savings accounts, MMAs, CDs, merchant services, payroll processing, business insurance, business credit cards, commercial real estate loans, lines of credit, term loans, nationwide and international NFCU branches and ATMs
• Potential drawbacks: Membership is strictly limited, high opening deposit required for business accounts

Finding the right credit union for your small business can lead to substantial savings, better service, and flexibility—especially if you’re looking for a more community-driven approach. By comparing your needs to the offerings of top credit unions, you can build a banking relationship that supports your business goals. 

FAQ

Can businesses be members of credit unions?

Yes, businesses can be members of most credit unions. Like joining a credit union as an individual member, your business has to meet certain eligibility requirements. You must usually gather required documentation and apply either online or in person.

Why are credit unions cheaper?

As credit unions are non-profits and owned by their members, all profits credit unions make are passed on as savings to members. This can mean lower or no monthly fees, better interest rates, and higher dividends, leading to savings for you. 

Is it better to get business loans from credit unions?

Depending on your business needs, commercial loans from a credit union may be more beneficial to you. Their nonprofit status means that you’ll usually find more flexible loans with better interest rates. Plus, as a member, their more personalized services may help you choose the best loan for your situation. 

How can you build small business credit with credit unions?

Credit unions make it easier for small and medium-sized enterprises (SMEs) to get access to finance options and build their credit. Since you’re a member, you’re typically more likely to be approved for a loan or line of credit at a local credit union than at a large commercial bank. Plus, since many credit unions offer business planning services, they can help you to take steps (like incorporating your business) that further improve your credit.

• A business budget is a guide to help you handle your money and reach your goals.
• It includes predicting income, keeping an eye on costs, and making smart choices on how to use resources.
• Important parts of a budget are estimating income, examining fixed and variable costs, and planning for profit.
• By making and following a budget, you can have better control over your cash flow, make smart choices, and boost your chances of success.

Running a small business in the United States, particularly in a busy metro area, demands strong financial skills. A key part that many forget is budgeting. Making and keeping detailed budget reports is essential for any business owner who wants to grow and make a profit over time.

Understanding the Importance of Budgeting in Business

Running a business without a budget is like trying to find your way in a new city without a map. A budget acts as your financial guide. It shows you your income, expenses, and resources. A budget helps you keep track of your money, spot issues early, and make smart choices for your business later on.

The Role of Budgeting in Financial Management

Budgeting is a key part of managing money well. At its heart, a budget takes your financial goals and turns them into a clear plan. This plan, usually as an approved budget, outlines the money you expect to make and the costs you expect to have. It also acts as a standard to measure how well you are doing financially. By looking at what you actually earn and spend compared to the budget proposals, you can easily see differences. You can then find out why these differences happen and take steps to stay focused on your goals.

How Budgeting Can Lead to Better Decision Making

A good budget is more than just a list of numbers. It is a strong tool for planning and making better choices. When you understand your finances well, you can use your resources in a smart way.

For example, you can find places to save money. This can help you have money available for new chances. This careful use of resources can help your growth and meet your business goals. In the end, a strong budget helps you make smart, informed choices that match your main goals.

Key Components of a Successful Business Budget

A good business budget is clear and well-organized. It starts with a reasonable guess of income, including all possible ways to earn money. Then, it looks closely at expenses and sorts them into fixed and variable costs. Lastly, a complete budget will include a strategy for handling cash flow. This way, you can ensure you have enough money to cover your payments. Additionally, it’s important to regularly review and adjust the budget as necessary to accommodate any changes in income or expenses. For those new to budgeting, seeking out business budget creation tips can provide valuable insights and streamline the process. By staying proactive and adjusting strategies, businesses can maintain financial health and adaptability in a changing market.

Revenue Estimation: The Starting Point

A clear revenue estimation is very important for your budget. Begin by finding all the ways your business makes money. This can include selling products or services, rental income, or any other way to earn money. Once you know where your money comes from, you should create sales forecasts. This means looking at past data, market trends, and the current economy to predict future sales. Analyzing the market helps you understand competition and how customers behave, which can improve your revenue estimates. Keep in mind that your revenue estimation should be based on solid data and realistic ideas.

Fixed vs. Variable Expenses: Balancing the Scales

Understanding the distinction between fixed and variable expenses is essential for effective cost management. Fixed costs remain relatively consistent regardless of your sales volume, such as rent, salaries, or insurance premiums. On the other hand, variable costs fluctuate directly with sales, including raw materials, manufacturing costs, or sales commissions. Managing both types of costs is key to maintaining a healthy bottom line. Here’s a simple way to visualize the two:

Expense Type	Description	Examples
Fixed Costs	Remain relatively constant regardless of sales volume	Rent, salaries, insurance premiums
Variable Costs	Fluctuate in direct proportion to sales or production volume	Raw materials, sales commissions, shipping costs

Practical Steps to Create Your First Business Budget

Now that you understand the main parts of a budget, it’s time to put that knowledge to use. Creating a budget can feel overwhelming, but you can simplify it into small steps. First, you need to set clear financial goals. Then, gather information about your income and expenses.

Identifying Your Business’s Financial Goals

Before looking at the numbers, take some time to define your business’s financial goals. What do you want to achieve with money in the short-term and long-term? Are you aiming to make more profit, invest in growth, or save cash? Clearly set your short-term goals, like raising sales by a certain amount this quarter. At the same time, detail your long-term goals, such as getting a certain share of the market or expanding into new areas in five years. Make sure your profit targets are specific and can be measured. This will help to keep everything in line with your overall business plan. These clear goals will guide you in making a budget and keep you focused on what is really important for your business’s success.

Tracking and Adjusting Your Budget Regularly

Creating a budget is just the first step. After you make it, you should track your progress and change things if needed. Think of your budget as a living document. It needs regular checks and updates to stay useful. Here’s how to keep your budget on track:

• Regular Monitoring Expenses: Make it a routine to check your expenses often. You can do this weekly, every two weeks, or monthly, based on what your business needs and how many transactions you have.
• Conduct Periodic Financial Reviews: Don’t only track expenses; do detailed financial reviews every month or every few months. This means looking at how your actual performance compares to the budget, calculating important financial ratios, and spotting any issues that need your attention.
• Implement Timely Adjustments: Feel free to change your budget when needed. The market can shift, unexpected costs can come up, and your business can change. Your budget should be flexible enough to handle these changes while keeping you focused on your financial goals.

Frequently Asked Questions

What Is the 50/30/20 Rule in Budgeting and Can It Apply to Businesses?

The 50/30/20 rule is a guide for managing money. It suggests putting 50% of your income towards needs, 30% towards wants, and 20% for savings. While this rule doesn’t directly apply to businesses, its ideas about spending and saving can be used for business budgeting.

Bookkeeping is the foundation of every successful small business. It helps you track income, manage expenses, and stay compliant with tax laws. With services like Remitly, cross-border financial management becomes easier, so you can focus more on growing your business. This beginner-friendly guide breaks down the basics of bookkeeping, best practices, and tools to help you stay organized with your finances.

Understanding bookkeeping for businesses

Let’s take a look at the fundamental concepts of bookkeeping and why it’s vital for your business’s success. A clear understanding of financial transactions helps maintain accurate records and ensures compliance with regulations. By implementing a stepbystep bookkeeping process, you can better track income and expenses, allowing for informed decision-making and improved financial health. Ultimately, effective bookkeeping lays the groundwork for growth and can contribute significantly to your business’s profitability.

What is bookkeeping and why does it matter?

Bookkeeping involves recording and organizing your business’s financial transactions, such as sales, purchases, and payroll. It provides a clear picture of your financial health, helps you prepare for tax season, and supports better decision-making. Accurate records can also protect your business from legal issues and make audits much easier.

Key bookkeeping terms every business owner should know

• Assets: Resources owned by your business, such as equipment, inventory, and cash
• Liabilities: Debts or obligations like loans and unpaid invoices
• Equity: The owner’s stake after subtracting liabilities from assets
• Income statement: A summary of revenue and expenses over time that shows profit or loss
• Balance sheet: A snapshot of assets, liabilities, and equity at a specific time
• Accounts payable: Money your business owes to suppliers
• Accounts receivable: Money owed to your business by customers
• Cash flow: How money moves in and out of your business
• General ledger: A master document tracking all your business’s financial transactions

Bookkeeping methods for small businesses

Choosing the right bookkeeping method depends on your business’s size, complexity, and future goals. These are the two most common approaches.

Single-entry vs. double-entry bookkeeping

Single-entry systems record each transaction once, like a checkbook. This method suits microbusinesses with straightforward finances, such as freelance consultants. However, it lacks error-checking mechanisms and detailed financial insights.

Double-entry systems log every transaction twice (as a debit and credit) to ensure accuracy. For example, a $500 sale increases revenue (credit) and cash (debit). While more complex, this method is ideal for businesses with inventory, loans, employees, or multiple revenue streams.

Below is a quick comparison:

Aspect	Single-entry	Double-entry
Complexity	Low	Moderate to high
Error detection	Limited	Robust
Best for	Sole proprietors	Businesses with employees/inventory

How to choose the right method for your business

Think about your business size, complexity, and growth goals. For example, a freelance graphic designer might prefer single-entry for simplicity, while a small retail store with inventory and staff would benefit from the accuracy and detail of a double-entry system.

How bookkeeping supports your business finances

Keeping accurate records helps you:

• Identify trends: Track seasonal changes in sales or rising supply costs
• Secure funding: Lenders require organized financial statements
• Prepare for taxes: Deduct eligible expenses and reduce audit risk

Essential bookkeeping practices

To maintain accurate and reliable financial records, it’s essential to establish and follow sound bookkeeping practices.

Setting up a bookkeeping framework

A solid framework helps you manage your records efficiently from day one.

• Choose an accounting method: Decide whether you’ll use the cash method (recording income and expenses when money changes hands) or the accrual method (recording income earned and expenses when incurred, regardless of payment timing)
• Set up a chart of accounts: Create a list of the accounts you’ll use to record transactions, then organize these accounts into categories like assets, liabilities, equity, revenue, and expenses
• Open business bank accounts: Keep your business and personal finances separate by opening a dedicated business account to simplify tracking and reduce tax complications
• Implement a transaction recording system: Options include a manual spreadsheet or bookkeeping software like QuickBooks, Xero, or Wave
• Establish a filing system: Organize both physical and digital records, such as invoices, receipts, and bank statements, for quick access and audit readiness
• Set a bookkeeping schedule: Decide how often you’ll record transactions, reconcile accounts, and prepare financial reports

Tracking business transactions accurately

Proper transaction tracking prevents costly errors and ensures your financial data is reliable.

• Record everything: Log every financial transaction, even small ones, promptly and accurately
• Use original documents: Retain invoices, receipts, bank statements, and contracts to support your records
• Categorize correctly: Match each transaction with the appropriate account in your chart
• Double-check entries: Review regularly to identify and correct any errors
• Reconcile bank statements: Compare your bank statements with your internal records to ensure accuracy and identify any discrepancies

Organizing and managing financial records

Well-managed records make tax time and audits much easier.

• Create a filing system: Organize your financial documents by type and date, both physically and digitally
• Label consistently: Use clear and consistent naming to simplify searches
• Store documents securely: Protect sensitive financial documents from damage, loss, or unauthorized access
• Back up digital files: Regularly back up your digital financial records to the cloud or external drives to prevent data loss
• Know retention rules: Keep financial records for the period required by law—usually 5 to 7 years in the US

Preparing financial reports and statements

Preparing financial reports and statements provides insights into your business’s performance and financial position. Here are the key reports:

• Balance sheet: This shows your business’s assets, liabilities, and equity at a specific point in time. It provides a snapshot of your financial health.
• Income statement: Also known as a profit and loss (P&L) statement, this report shows your business’s revenue, expenses, and profit or loss over a specific period
• Cash flow statement: This statement tracks the movement of cash into and out of your business, categorized into operating, investing, and financing activities

Tools and resources for efficient bookkeeping

To make bookkeeping smoother and more efficient, it’s helpful to leverage the right tools and resources that match your business’s needs.

Overview of bookkeeping software options

• Spreadsheets: Programs like Microsoft Excel or Google Sheets can be used for basic bookkeeping, especially for very small businesses. However, they can be prone to human error and may not be suitable for complex accounting.
• Desktop software: Software like QuickBooks Desktop or Sage 50 can be installed on your computer and offer more advanced features than spreadsheets
• Cloud-based software: Cloud-based software like QuickBooks Online, Xero, or FreshBooks is accessible from anywhere with an internet connection and offers features like automatic bank feeds and collaboration tools

Free vs. paid accounting solutions

When choosing the right bookkeeping software for you, you’ll find both free and paid options. Free tools, such as Google Sheets budgeting templates or basic versions of cloud-based platforms, may be suitable for sole traders or businesses just getting started. However, they often have limited features and may not scale as your business grows.

Paid solutions offer a more comprehensive set of features, from automated transaction imports to advanced reporting and customer support. Although they involve a cost, they can save you time and reduce errors in the long run.

Streamlining finances with cloud-based tools

Cloud-based bookkeeping tools offer the following advantages:

• Accessibility: View and access your financial data from anywhere with an internet connection
• Automation: Automate tasks like bank reconciliation, invoicing, and reporting
• Collaboration: Allow multiple users to access and work on the same data simultaneously
• Real-time data: Get up-to-date insights to guide better financial decisions
• Integration: Integrate with other business tools like payroll or CRM software
• Security: Benefit from strong encryption and backup protocols to protect your financial data

Common bookkeeping challenges and solutions

Even with solid systems and the right tools in place, bookkeeping can still present some hurdles. Below are some common issues and practical ways to address them.

Balancing time-consuming tasks with business growth

Bookkeeping can be time-consuming, especially as your business grows. Here’s how to efficiently maintain bookkeeping tasks with other business priorities:

• Automate tasks: Use bookkeeping software to automate repetitive tasks like invoicing
• Outsource bookkeeping: Consider hiring a bookkeeper or using a bookkeeping service to handle your financial records
• Prioritize tasks: Focus on essential bookkeeping tasks, such as tracking cash flow and keeping accounts up to date
• Set a schedule: Allocate specific times each week or month for bookkeeping tasks
• Use technology: Leverage mobile apps and cloud tools to streamline processes and reduce errors

Understanding tax requirements and preparation

• Know your tax obligations: Familiarize yourself with the tax rules that apply to your business type and location
• Maintain accurate records: Keep detailed and organized records of all income and expenses
• File taxes on time: Missing deadlines can lead to penalties, so set reminders and plan ahead
• Seek professional advice: A tax advisor can offer personalized guidance and help you stay compliant
• Use tax software: Tax software can help with tax preparation and filing

What are some common bookkeeping mistakes to avoid?

• Mixing personal and business finances
• Not recording all transactions
• Failing to reconcile bank statements
• Not backing up financial data
• Misclassifying transactions
• Ignoring accounts receivable and payable
• Not seeking professional help when needed

When to hire a bookkeeper or use bookkeeping services

To know when to hire a bookkeeper or use bookkeeping services, consider these factors:

• Business size and complexity: As your business grows or your transactions become more complex, professional help can ensure accuracy
• Time constraints: If bookkeeping tasks are taking up too much of your time, outsourcing may be a practical solution
• Lack of expertise: If you’re not confident in your bookkeeping knowledge and accounting principles, a professional can provide valuable assistance
• Cost-benefit analysis: Weigh up the cost of hiring a bookkeeper or using a service against the time and potential errors saved

FAQs

What are the basic bookkeeping practices for a small business?

Basic bookkeeping for small businesses includes setting up a chart of accounts, recording all transactions accurately and promptly, reconciling bank statements, and preparing financial statements like balance sheets and income statements. Keeping your financial records organized is also essential to stay on top of your finances.

How often should I reconcile my bank statements?

Bank statements should be reconciled at least once a month. This process involves comparing your internal records with your bank statements to ensure accuracy and identify any discrepancies. Reconciling more frequently, such as weekly, can help you catch errors or suspicious activity sooner.

What is the difference between bookkeeping and accounting?

Bookkeeping is focused on recording financial transactions, while accounting is the broader process of analyzing, interpreting, and reporting financial information. Bookkeepers handle tasks like invoicing and expense tracking, while accountants use that data to generate financial reports and offer strategic advice.

What are the key financial statements for a small business?

The main financial statements for small businesses are the balance sheet, income statement (or profit and loss statement), and cash flow statement. The balance sheet shows your business’s assets, liabilities, and equity at a specific point in time. The income statement shows your revenue, expenses, and profit or loss over a certain period. The cash flow statement tracks how money flows in and out of your business.

What are some bookkeeping software options for small businesses?

Small businesses can choose from a range of bookkeeping tools, from simple spreadsheets to more advanced accounting software. Popular options include QuickBooks Online, Xero, FreshBooks, and Sage. The best choice depends on your business’s size, complexity, and budget.

Running a small business can feel like juggling many moving parts. With so many balls in the air, finding a right banking partner to provide services tailored to your business needs, facilitate smooth transactions, and offer support when issues arise can make at least one aspect of business ownership a lot easier.

If you’re in the market to find a new bank for your small business, you’ve come to the right place. Here’s Remitly’s guide to help you narrow down your choices. We compare popular banks for small businesses and provide some tips on what factors to keep in mind when making your choice.

The importance of choosing the right business bank  

If you’re starting a small business, knowing where to begin with banking can feel a bit overwhelming—there are so many choices available. Many banks offer similar features, which can make them all feel like a good fit. But there’s no one-size-fits-all solution, and understanding what you aren’t willing to compromise on can be a good place to start.

Key factors to consider in business banking  

Some of these things—like the standard of customer service, for example—are only going to become clear over time, of course. So a recommendation from somebody you trust in a similar position is always valuable. That said, we’ve broken down what to consider and what you need to know to narrow your choices.

• Fees and costs
  Fees can add up over time and affect your bottom line. Look for banks with minimal or waivable fees, including low or no monthly maintenance, transaction, and ATM charges.

• Account Features
  It’s not just what services are offered but what services your small business requires most to succeed—especially when you’re first starting out. Consider creating a list of must-have features, such as online banking, mobile app functionality, and integration with accounting software.

• Branch and ATM accessibility
  Depending on your business model, accessibility to branches and ATMs is something to consider when comparing against banks that have no physical branches.

• Customer service
  As a business owner, you’ll understand how important customer service is, and why having access to service—no matter the time of day—can help when you’re faced with unexpected challenges.

• Additional services
  What can they offer you that others don’t? Being able to get everything done from your phone or computer, for example, can make daily operations much easier. Or maybe some of the banks offer additional perks for business account holders—we’ll come back to that later.

How to choose a bank for your small business  

Only you will know exactly what your small business requires. But a good place to start is assessing your finances. 

You might also ask yourself whether you prefer a traditional, brick-and-mortar bank or an online-only institution. Another thing to consider is how often you’ll deal with cash transactions, if at all, and what that might mean if you choose to go with an online-only bank. 

Choosing a bank is about finding one that aligns with your long-term business goals, not just your immediate needs. For instance, many small business owners choose to work with more than one bank, and while that can make things a bit more complex for everyday operations, it may also serve your business better if you branch out. 

• Identify your business needs
  Daily operations can indicate which services are non-negotiable—this might include wire transfers and cash transactions. 

• Shop around and compare account options
  It pays to look into a number of banks. Consider actually going to the branches and asking questions—but you can also see comparisons online or speak to a representative over the phone to see how it might work, if you don’t have a local branch. 

• Consider the bank’s reputation
  Is this a bank with a long-standing reputation like Chase Bank? Live Oak Bank, by contrast, opened in 2008. Of course that doesn’t mean it’s definitely not the right bank for you, but it may be a consideration.
• Assess tech capabilities
  Being able to streamline most of your business from your phone or computer can save you time and money as more and more of our daily lives move online.

Top banks for small businesses

Comparing the various options and offers of potential banking partners is a great way to help you understand what your small business might require to function every day—and help it grow in the future.

Overview of leading business banking options  

The bank you choose for your small business will almost certainly offer checking, savings, business credit cards, merchant services, and a host of other options for you to ensure your business runs smoothly and securely. Many leading lenders offer special promotions and offers when you choose to open a business account with them.  Additionally, it’s worth considering the credit union benefits for small businesses, as they often provide lower fees, competitive interest rates, and personalized service tailored to your needs. Many credit unions focus on building long-term relationships with their members, which can lead to more flexibility when it comes to financing options. Exploring both traditional banks and credit unions can help you find the best fit for your business goals.

Streamlining your business finances for tax season, being able to wire money safely, and ease of doing business internationally are all services you might need. If they don’t offer these, consider how that might impact your business.

Many leading banks, for example, offer ACH transactions as an easy option for transferring money. Would your business be impacted if this offer isn’t available?

Comparison of business checking accounts’ features and fees  

The checking account is the foundation of your banking needs in a venture of any size. It’s often the first account to be opened when starting a new business. 

A full list of banks for small business checking accounts would be very, very long. We’ve compiled 10 of the most popular bank accounts for new or small businesses, allowing you to see their main offers and how they all differ. We’ve included information on some of their features that might speak to your personal business requirements.

Offers for savings accounts, credit cards, and loans also vary, so be sure to check out each bank’s offer if you’re looking to have both a checking and savings account or you need a loan.

 

Bank	Monthly Fee	APY	Minimum Balance to Open a Checking Account	Features
American Express Business Checking	$0	1.30% on balances up to $500,000	$0	Pros: 24/7 customer service, ATM withdrawals, no monthly maintenance fees Cons: No cash deposits, no outgoing international wire transfers
Chase for Business	$15 waivable	N/A	$0, or $2,000 to qualify for bonuses	Pros: Fee-free transactions with ACH and other payment processes, accessible in 48 US statesCons: Monthly fees
US Bank Silver Business Checking	$0	N/A	$100	Pros: Large sign-up bonus offers, loans, and positive customer service reputation Cons: Fees for exceeding monthly transaction limits
Key Bank	$5-$25 waivable	N/A	$25	Pros: Low monthly fees for Business Basic Checking, reasonable transaction limits for growing businesses Cons: Limited fee transactions, fees if minimum requirements are not met, high overdraft charges
Bank of America	$16, $0 if certain requirements are met	N/A	$100	Pros: Rewards, large ATM and branch network, multiple ways to waive fees Cons: Fees and limits on cash deposits
Live Oak Bank	$10-$100 waivable	N/A	$0	Pros: No transaction limits, high-interest savings account options, human customer support Cons: No physical branches, high balance requirements to waive fees
Bluevine	$0	1.5% on balances up to $250,000	$0	Pros: Wide network of no-fee ATM access, 1.5% APY can be upgraded to 3.7% Cons: No physical branches, no weekend phone support, no joint business accounts
Navy Federal	$0-$20 waivable	0.01%- 0.45%	$250-$255	Pros: No monthly fees, 24/7 customer service, unlimited free online transactionsCons: Membership is limited to certain individuals with military or Department of Defence connections
Capital One	$15-$35 waivable	N/A	N/A	Pros: Extensive network for ATMs, overdraft protection, unlimited free transactions Cons: Limited branch location, high fees if requirements aren’t met
Wells Fargo	$10 waivable	N/A	$25	Pros: Large network, 24/7 fraud monitoring, no transaction fees for first 100 transactions Cons: High fees for things like overdrafts, returned items, stopped payments etc.

 

Specialized business banking services

Most banks offer services that reflect the different needs of personal and business account holders. 

Business credit cards and loans 

If you’re running a small business, credit cards and loans are great tools to help cover unexpected expenses or manage cash flow. Many banks like Capital One or Bank of America offer rewards each time you use their business credit card, too. 

Need to take a client out for dinner? Earn 2% cash back when you use your Bank of America card, for example. Not only can you use the card to cover business expenses, you also help your credit record with the bank at the same time—providing you stay on top of payments. 

Loans might feel scary, but they’re beneficial in the same way—giving you the capital needed to make investments and improvements so your business continues to grow. 

Savings accounts and overdraft protection  

Saving for a rainy day isn’t just something to consider for your personal expenses—having a reserve in a business savings account provides a financial cushion for emergencies or future investments and expansion. For example, Live Oak Bank offers a generous APY of 3.6% on funds sitting in their small business savings account.

Many businesses experience cash-flow challenges in their early days, so overdraft protection can be a valuable service, covering your account if it falls into the red for any reason. Being prepared for any scenario will help you protect your small business, providing it with the stability it needs to succeed.

Local vs. online banks: which is better?  

The world of banking has changed, with physical branches disappearing and much more done online, for both personal and business customers.

Pros and cons of local business banks  

If you can find a brick-and-mortar branch, often provide a personalized service that online banks may struggle to match. Sometimes you may just want to speak to a person to resolve any issues you encounter. Banks with in-person services in your area will also know the local market and conditions better as they’re physically based within your community.

On the flip side, many local banks tend to have higher fees and lower Annual Percentage Yields. It’s not always the case, but it can make a difference over time.

Advantages of online banking for small business

With online banking, you can’t just head to a branch in an emergency, or handle cash deposits without a third-party service, and that’s assuming this service is provided. However, there are still many advantages to choosing an online-only bank for your business.

• Lower fees
  With lower costs for things like rent and staff, digital banks can translate these savings into lower fees for their customers.
• Great for startups and entrepreneurs
  The application process is often seen as more straightforward than traditional banks, with no minimum deposit required and new accounts processed within minutes.

Only you know what your small business needs, and luckily, most banking options will serve you well. Remember to keep certain key factors in mind and have a list ready when shopping around for business accounts. No monthly fees, competitive interest rates, and credit cards that give cash back are assets when running a small company or startup. Being firm in what your small business helps you choose a bank that makes sense for your small business.  Additionally, consider the bank’s customer service and digital banking capabilities, as these can greatly impact your daily operations. Understanding how to select a business bank account that aligns with your financial goals and operational needs is crucial for long-term success. Take the time to compare different institutions and their offerings to ensure you make an informed decision.

FAQs

What’s a great bank to use for an LLC?  

American Express Business Checking and Bluevine often make the list of best options to consider when choosing a business banking account.

Which bank offers the most cost-effective solutions? 

Both Live Oak Bank and Bluevine offer no-fee accounts with high interest, making them two of the top cost-effective choices for small businesses.

Which banks are best for business banking?

Large financial institutions with long-standing reputations for business banking like Chase, Bank of America, and Capital One are often seen as top picks to meet your small business needs. They offer a variety of options and services that smaller or online-only banks often can’t provide.

Is Amex good for small businesses?

If you’re in the market for business credit cards that offer rewards and cashback, Amex is a great choice. Along with credit card perks, they offer multiple financing options, such as business loans or lines of credit.

What’s the cheapest business bank account?

The size of your business and the services you need will determine which business account is the cheapest. 

Is a local bank better for small businesses?

If you’re looking for a more personalized service, local banks and branches might be the better option. Local banks have the ability to offer more flexibility, but they may have limited online tools. It comes down to what your business values or requires more.

Note: Mentions of third-party providers are for informational purposes only and do not imply endorsement by Remitly. Product features and pricing may change—please consult each vendor’s website for current information.

As an immigrant entrepreneur, staying competitive in an oversaturated market comes with its challenges. From promoting your business to forming partnerships, flexibility in payment options remains key to small business success.

Today’s consumers use less cash and expect quick, seamless credit card payments. Adapting to these expectations can strengthen your customer relationships and increase sales.

At Remitly, we know launching a business involves many decisions. This guide covers credit card payments, processing systems, pricing, and security practices—all tailored for small businesses.

Why Credit Card Payments Matter

As 64% of Americans expect a cashless future, non-cash payments have become essential. If your business operates on narrow margins, offering multiple ways to pay can protect and grow revenue.

Boosting Efficiency and Satisfaction

Payment methods at checkout influence sales—77% of shoppers abandon carts when their preferred payment option is missing. Accepting cards helps convert more customers and enhances satisfaction.

Common Payment Methods

Credit and Debit Cards

Cards are widely used for convenience and security. Business-side fees vary by card type, network, and processor (e.g., Stripe, Square, PayPal).

• Online: Customers enter card info via website or app with authentication.
• In-person: Cards are swiped, inserted, or tapped at POS terminals.

Digital Wallets

Apps like Apple Pay and Google Pay offer secure, contactless payments via NFC. These require compatible hardware but enhance speed and safety for customers.

Bank Transfers

Common for B2B, ACH and wire transfers are secure but slower. Learn more about ACH payments.

Buy Now, Pay Later (BNPL)

Used increasingly by Gen Z, BNPL services grew to a $37.8 million market in 2024. Merchants may face higher transaction fees and delayed payouts.

Setting Up Card Processing

Online Payments

Choose a gateway like Stripe, Square, or PayPal based on your product, audience, and needs. Consider: Evaluate the fees associated with each service, as they can significantly impact your profit margins. Additionally, assess the ease of integration with your existing systems and the level of customer support provided. Ultimately, taking the time to research and compare these factors is crucial when choosing a payment processor.

• Real user reviews
• Monthly or per-transaction fees
• PCI compliance
• Simple checkout UX
• 24/7 customer support

For a secure checkout, implement:

• SSL/TLS encryption
• Tokenization for data protection
• 3D Secure authentication
• OTPs for sensitive fields
• Guest checkout options

In-Person Payments

• Standalone terminals: Basic and internet-connected; supports all card formats.
• Local POS systems: Offline capable; good for data privacy.
• Integrated systems: Cloud-based; best for hybrid retail.
• mPOS readers: Mobile-friendly but costlier per transaction (e.g., Zettle, SumUp).

Processing Providers: Fees & Features

Provider	In-Person Fees	Online Fees
Stripe	2.7% + $0.05	2.9% + $0.30
Square	2.6% + $0.05	2.9% + $0.30
Helcim	1.83% + $0.08 (AMEX fees may apply)	2.27% + $0.25 (AMEX fees may apply)
PayPal	2.9% + $0.09	2.89% + $0.49
PayAnywhere	2.69%	3.49% + $0.19

Reducing Payment Risks

Digital payments come with fraud risks like identity theft, phishing, and chargebacks (fees: $15–$50 per instance). Implement these strategies:

Fraud Detection & AI

Modern systems spot suspicious patterns and evolve as threats change.

Transaction Audits

Regularly review your processes and logs to catch irregularities and ensure compliance.

Tokenization

Use encrypted tokens instead of storing actual card data.

Access Controls

Only allow credentialed users to handle sensitive payment data.

3D Secure

Use OTP or biometric verification to reduce chargeback risks.

FAQs

Can I write off credit card processing fees?

Yes. These are typically deductible as standard business expenses.

Which is cheaper: Stripe or Square?

Square is slightly cheaper (0.01%) for in-person payments on its basic plan. Stripe may offer better rates for high-volume businesses via custom pricing.

Why accept credit cards at all?

It increases convenience, trust, and transaction volume—benefits that drive business growth.

While invoicing may seem tedious and time-consuming when you’ve got so much else to do as an entrepreneur, cash flow is absolutely critical to keeping the lights on. Invoicing software can take a lot of the stress out of this laborious task.

At Remitly, we’re committed to supporting immigrants and business owners to get on their feet and manage their finances in the USA. In this guide, we’ll take a look at everything you need to know about invoicing, highlighting some of the different software options out there which will make the task more efficient and allow you to spend more time on running your business.

Best invoicing software for small businesses

Invoicing software, also known as billing software, is a tool that any freelancer or small business owner should have in their arsenal–among many others. Rather than calculating payments and writing up each invoice by hand, let invoicing software handle the leg work and free up more of your own time and energy.

Aside from the convenience they offer, there are plenty of reasons why invoicing software could be highly valuable to you.

Why software for invoicing is essential for small businesses

With invoicing being such an important task in any business, anything you can do to make this process more accurate, more reliable, and more efficient is a step in the right direction. That’s where invoicing software comes in.

It can help in a few key ways. With the right software, you can store and quickly access your customers’ history and data. Your sales data can also be stored to make recording income easier come tax season. As invoice software helps you keep track of everything, you’re also less liable to make errors like losing track of overdue incoming or outgoing payments. All this means your business will run more efficiently and you can more reliably keep on top of that cash flow.

Overview of top invoicing software features to consider

When choosing invoicing software, its features will be the most important aspect in deciding which one to use. The best invoicing software for small businesses should be able to:

• Create customized invoices,
• Accept online payments and send automatic payment reminders,
• Track the status of all your invoices on an easy-to-read dashboard,
• Create estimates or quotations and then convert them to invoices.

Your invoicing software of choice should also offer integration with your chosen accounting software as well as interface with e-commerce sites, your Customer Relationship Management (CRM) software, and your inventory applications.

Top five options for invoicing programs for small businesses

Keeping these features in mind, let’s check out five different invoicing software options. These popular solutions already serve many small business owners and freelancers well, so one of them will likely be a good fit for your business. These invoicing tools offer various functionalities, from automated billing to customizable templates, making them ideal billing solutions for small businesses. Additionally, many of them provide integrations with other financial software, streamlining the overall financial management process. By evaluating each option, you can find the best match for your specific needs and improve your invoicing efficiency.

Zoho Invoice: small cost, big features

Zoho Invoice is a free software with plenty of features. Though it’s limited to only 500 invoices sent per year, freelancers and other very small businesses should find this to be enough for their needs. You can create templates, send invoices through multiple contact methods and receive payment for them through just as many payment options. 

It also offers apps on both iOS and Android devices and integrates with QuickBooks accounting software to track not just income but also business expenses. So for a free option, it’s pretty good.

QuickBooks: suitable for very small businesses?

Quickbooks is a tried and tested option that, while packed with features like inventory management, in-person payment processing, time tracking, and tax preparation, does come at a bit of a cost. Depending on the features you need, the price can range from $35 to $235 per month.

For a small business in a brick-and-mortar location with employees and inventory to track, Quickbooks can be a great solution. But if your business is smaller, this may be more than you need.

FreshBooks: how does it compare to QuickBooks?

FreshBooks is a strong choice for businesses and freelancers who are just getting started and don’t have the accounting expertise to understand the jargon that an option like QuickBooks might throw at them.

FreshBooks allows for payment processing and invoice creation with very accessible pricing—starting as low as $21 per month—but it can quickly add up, depending on how many clients you’ll be billing and whether you’ll need advanced payment options. Still, it can be a very good option for business owners and freelancers who are just starting out and feel a bit daunted by QuickBooks.

Invoice Ninja: does it make the cut?

Invoice Ninja is another software which offers free plans. What this excels at is its ability to customize payments and even accept deposits and tips. Invoice Ninja also works with over a dozen different payment gateways to help you reach more customers. 

It includes inventory tracking and a client portal, but a downside is that it doesn’t integrate with any bookkeeping or accounting software, so you’ll need to find a way around that. That said, for people just getting started, Invoice Ninja’s free plan will be plenty to help you get your business off the ground.

Invoicely: it’s all about growth.

Invoicely is another one that’s been around as a free option for some time. It has a strong set of payment gateways, but the free version only allows for PayPal integrations and lacks customization options and space for saving customer profile information.

However, the Basic plan can be a good deal at $9.99 per month and this offers plenty of room for scaling your business up before you need to move to a more upscale solution.

Simplify business invoicing with customizable templates

Having looked at a few of the popular options, one feature that comes up a lot is customizable templates. Customizable templates are tools which allow you to save and come back to certain invoices which can also be updated to fit your current need. This can be really helpful and incredibly efficient in running your small business.

The role of invoice templates in streamlining business operations

The benefits of using invoice templates might seem simple, but they go a long way towards making your business run smoother.

• Save time
  You won’t need to go in and design your invoice from scratch each time.
• Build your brand
  The professional appearance of a consistent design for your invoice can make a marked difference in the eyes of your customers.
• Fewer errors
  Put in your data once and it’ll always be at your fingertips. This means less need to double-check customer or product information and less likelihood of making a careless error.
• Faster payments
  Invoices that are clear and well-designed give no excuse for late payment.
• Room to grow
  As you add more clients and more products, the information is saved efficiently and sending more invoices based on a template is much faster than making each one individually.

How to create, customize and use invoice templates

Each invoicing software will be slightly different, but they’ll all offer similar features when it comes to customizing and using your invoice templates.

Start by choosing your design elements. This will include your business logo, matching the color scheme to your brand, and picking typefaces that align with your identity. Your invoice should be a clean and professional document, so less is more on these templates—don’t make them too cluttered.

When it comes to actually using your templates, take advantage of them by following a consistent invoicing schedule and automating any recurring ones where you can. With your template, sitting down to create the invoices means you can get many more made at once and make less demands on your precious time and energy.

Using invoicing software to make billing more efficient 

In many cases, “invoicing software” and “billing software” are one and the same. This means that the software you use to create your invoice will also be the one that you use to collect payment. This is one of the things that make invoicing software so efficient. But there are a few ways that this can be taken even further.

Automate your billing process 

Automating billing frees up time you can spend working on growing your business. As you’ll know, writing up the invoice is only the first step in the process—you have to send it out, and you need to make sure you’re paid in time and chase it down if it’s late.

With automated billing, all of this can be handled in the background while you deal with more pressing tasks. Many invoicing software options will not just send invoices, but also track their payment status and send customizable, automated reminders in case of non-payment. They’ll often include at least one payment option as well. 

Benefits of using payment reminders and online payments

Automated payment reminders and online payment options are two of the main draws of the best invoicing software solutions—aside from the efficiency gains, they often include multiple customizable options for contacting different client groups. 

These options will eventually help you better understand the best ways to reach your clients by analyzing the contact method that gets the best response. This leads to faster payment recovery for you and clients who are satisfied by you meeting them where they are.

Having at least one online payment option or “payment gateway” is another sign of efficient invoicing software. Integrating this into the invoice means that your preferred payment methods are readily accessible to your clients, no matter where they are. They’ll also be reassured by the more robust security and, in turn, more likely to pay you quickly.

Maximize the use of invoicing software for your small business

So, invoicing software can be a game changer for small businesses that are still sending out invoices manually. The time and energy saved by storing invoice templates alongside customer and product data can be massive, even before accounting for features like billing management and online payment processing.

Many of the options that we’ve talked about here are quite affordable, but there are options that are totally free. These are typically more than good enough for very small businesses or solo freelancers who are just starting out. Find the right one for you and you’ll have taken another positive step in ensuring your small business is a success.

FAQs

Is Excel good for invoicing?

While it can work for very small businesses, Excel isn’t the best solution in most cases because it lacks invoice-specific automation. That makes it more prone to human error and less than ideal as your business grows.

Is Zoho invoicing really free, and how much does it cost?

Yep, Zoho really is free. However, you can only send 500 invoices per year and only two user profiles can be added.

What’s the best software to create invoices?

The best invoice and billing software for a small business is the one that most closely aligns with your business’s needs. Some commonly recommended solutions are Zoho Invoice, Invoice Ninja and FreshBooks, but there are many others.

What are the most important tips for using billing software effectively?

Some of the best tips for using billing software include:

• Automate your invoicing systems,
• Standardize your billing information and invoice format,
• Offer multiple payment options.

At Remitly, we’re committed to helping your business succeed. That includes sharing financial tools and banking options designed to support business growth while helping you manage expenses. Whether you’re just starting out or looking to optimize operations, choosing a business checking account without monthly maintenance fees can help improve your financial efficiency. When considering how to select a business bank account, it’s important to evaluate factors such as transaction limits, account accessibility, and any additional services offered. Researching various financial institutions and comparing their offerings can empower you to make informed decisions that align with your business needs. Always remember to assess the potential impact of fees on your overall budget to ensure sustainable growth.

This article provides an overview of no-fee business checking accounts, the benefits they offer, and key factors to consider. We also review several well-regarded account options to help guide your decision.

Understanding Fee-Free Business Accounts

Fee-free business checking accounts are designed to reduce costs for business owners. In addition to no monthly maintenance fees, many also offer other advantages, such as low ATM fees or minimum balance requirements.

Why a Business Account Matters

Having a dedicated business account can benefit your company by:

• Separating personal and business finances: This can streamline budgeting and simplify tax preparation.

• Building professional credibility: A business account demonstrates formality and legitimacy to partners and clients.

• Offering tailored banking services: Many accounts include tools like online bill pay, business loans, and customer support.

• Improving cash flow management: Consolidated tracking of revenue and expenses supports clearer financial oversight.

• Laying groundwork for loans: A business account often serves as a foundation for securing financing.

Benefits of Choosing a No-Fee Option

Fee-free accounts allow you to access standard business banking tools without additional monthly costs—freeing up capital for other needs such as investments, inventory, or hiring. These accounts can be especially helpful for startups and small businesses managing tight budgets.

Notable Fee-Free Business Checking Accounts

Here are several banks and credit providers that offer business checking accounts with no monthly maintenance fees. Availability and terms may vary, so it’s important to review each institution’s website for current details.

• Bluevine Business Checking
  An online-only option with no overdraft fees and no minimum opening deposit.

• American Express Business Checking
  Offers no minimum opening deposit and access to a rewards program.

• Relay Business Checking
  Suitable for midsize businesses, with free cash deposits and no overdraft fees.

• US Bank Silver Business Checking
  A brick-and-mortar option offering limited free cash deposits and a $100 opening deposit.

• Axos Bank Basic Business Checking
  Provides ATM fee reimbursements and free cash deposits, with a $25 overdraft fee.

Note: Inclusion of these banks is for educational purposes and does not imply endorsement. Features are subject to change.

Choosing the Right Account

When comparing fee-free accounts, consider factors such as:

• Transaction volume and fees

• ATM access and reimbursement policies

• Online vs. in-person banking preferences

• Tools for managing payroll, invoices, and cash flow

Online banks often provide competitive features, but physical branches may be preferable depending on your operational needs.

How to Open a Fee-Free Business Account

Most banks allow business accounts to be opened online or in person. You’ll typically need:

• Business name and physical address

• Employer Identification Number (EIN) or SSN (for sole proprietors)

• Business formation documents

• Personal identification for authorized signers

Be sure to verify the minimum deposit requirement, if applicable.

Tips to Avoid Additional Charges

Even with no monthly fees, certain behaviors may trigger costs. Consider these best practices:

• Maintain a balance above any applicable thresholds

• Monitor for overdraft risks

• Use linked accounts to manage cash reserves

• Enable automatic payments to avoid late fees

• Opt for digital statements to streamline communication

Leveraging Financial Tools

Complement your account with software to support business growth. Commonly used platforms include:

• QuickBooks
• FreshBooks
• Xero
• NetSuite
• Scoro
• Hubstaff

These tools help track expenses, manage invoices, and simplify payroll.

Next Steps

Opening a fee-free business checking account is a practical step toward better financial management. By evaluating your needs and comparing available options, you can choose a solution that supports your business today—and positions you for long-term success.

FAQs

Can anyone open a business bank account?
Yes. Most businesses will need an EIN, but sole proprietors can often use their SSN.

Can sole proprietors use personal accounts instead?
It’s possible, but not recommended. A business account simplifies taxes and presents a more professional image.

When you transfer money between different countries, you will need quite a bit of information to make sure it’s done properly. There are two important numbers you’ll often need: SWIFT codes and IBANs. That naturally leads you to some questions: What is a SWIFT code? How about an IBAN? And do you actually need either of them to make a remittance?

The terms are simply shorthand ways that banks use to share information. SWIFT codes are more widely used all over the world. IBANs, on the other hand, provide information about bank accounts in certain countries.

Both SWIFT codes and the IBAN system can help to make international money transfers more efficient, and ensure that the money makes it into your recipient’s account. The primary difference between SWIFT codes and IBANs is the information they convey during the transaction.

What is a SWIFT code & how is it different from IBAN?

International transactions used to be difficult before banking networks introduced IBAN and SWIFT codes. Previously, there wasn’t a standard method of account identification that all countries recognized. Routing numbers were in place for domestic money transfers but not for cross-border payments.

That meant information used to identify an account in one country wasn’t always recognized by the receiving country. 

The lack of standardized identification methods meant errors happened often. Payments could go to the wrong person or could be delayed while banks worked to confirm details about where the money should go. Worst of all, payments could go missing, and it would be up to the customers and the bank to solve the problem, if they could.

The expense and trouble of international bank transfers was simplified thanks to the introduction of the SWIFT code in 1973 and the IBAN in 1997. Both methods still play an important role in international transfers today. 

SWIFT vs. IBAN: What’s the difference?

To sum it up quickly, a bank’s SWIFT code identifies a specific bank, while an IBAN identifies the sender’s or recipient’s bank account. 

Both enable the quick, accurate transfer of funds overseas, although they aren’t used by every country. For instance, the U.S. doesn’t use IBAN at all, though you will still need it if you are transferring money to a country that does use it. Read on for more information about each type of code.

International Bank Account Number (IBAN)

IBAN is an acronym that stands for “International Bank Account Number.” It makes it easier to identify a bank’s country and the specific account holder during the transfer.

The IBAN also helps banks confirm that a transaction’s details are accurate because the number begins with a two-digit country code, followed by two numbers, followed by up to thirty-five unique characters. 

The International Organization for Standardization (ISO) introduced IBAN in 1997. The ISO has long led various standards for the world’s banking system. However, the European Committee for Banking Standards (ECBS), which is the modern European Payments Council, originally raised concerns about the flexibility of early IBAN standards. 

In response, the ISO reworked the standards that required the IBANs for each country to be a certain length. It also required the use of only uppercase letters. 

Society for Worldwide Interbank Financial Telecommunication (SWIFT) code

SWIFT stands for the “Society for Worldwide Interbank Financial Telecommunication.” You might also see these referred to as “SWIFT/BIC codes,” “BIC numbers,” or “Bank Identification Codes,” but all of these terms refer to the same thing. These codes are essential for international money transfers, as they help to identify banks and financial institutions around the world. Understanding the swift code definition and purpose is crucial for anyone engaged in cross-border transactions, ensuring that funds are directed accurately and securely. Additionally, using the correct SWIFT code minimizes the risk of delays or errors in payment processing.

The SWIFT network is used by financial institutions around the world to securely share information and instructions. The system relies on standardized codes, with each specific bank (and sometimes each bank branch) having its own unique eight- to 11-character code.

Since its introduction in 1973, the SWIFT number (really an alphanumeric code) remains a common bank identifier for international payments and funds transfers. The standard format of each code goes like this:

• The first four characters consist of letters; they are the bank identifier codes.
• The next two characters consist of letters and give the country code.
• The next two characters can be letters or numbers and give a location code within the country.
• The last three characters can be letters or numbers and are optional, providing details about the specific branch code.

With the use of the SWIFT system and IBANs, banks can reduce the risk of error and process international transfers with much greater speed and accuracy. 

You can find SWIFT codes by logging into your account or contacting your bank. The codes are often posted on the bank’s website, and they may have different codes for different currencies.

Do you need to use an IBAN?

When making an international wire transfer, your bank will ask you for details regarding the intended recipient. One detail they may ask for is the recipient’s IBAN number, which can be found on a bank statement or by contacting the bank. 

If you make a lot of international wire transfers, you are likely to become familiar with IBANs because you need to provide them as part of financial transaction details. The IBAN system has become an international standard, especially in European countries, the Middle East, and the Caribbean. 

However, newer app-based methods for transferring money overseas don’t require you to know the IBAN or the SWIFT code in most cases.

Do I need an IBAN or SWIFT code to use Remitly?

Usually, no. If you use Remitly, we make it as easy as possible to complete your transfer. You don’t have to remember how a SWIFT code works or be able to find it quickly because you don’t need to enter one. What’s more, we usually don’t need an IBAN code to complete your transaction. 

We make it easy for you to send money to friends and family in countries all over the globe, including the Philippines, Mexico, or India.

Here’s all you need to do to get started:

1. For first-time users, download the Remitly app and create an account. Then, select your destination country.
2. Enter the amount you wish to send.
3. Select your preferred method of delivery, which will vary depending on your country but can include: bank deposit, cash pickup, mobile wallet, or home delivery.
4. Enter your recipient’s information, like their name and address. You will need their bank details if you’re sending to their account. For many countries, their bank account number is sufficient. However, some countries, such as Pakistan, ask for an IBAN instead. The Remitly app will prompt you for the appropriate number.
5. Enter your information as the sender.
6. Select your method of payment, and enter your payment details.

Transfers under SEPA (Single Euro Payments Area) in the European Union require a bit more security. SEPA payments need an IBAN and a SWIFT/BIC code because they are Economy transfers from a bank account to another bank account.

Make better international transfers

Though it might seem like a small detail, a SWIFT code is an important piece of the puzzle when transferring funds. While it’s good to know what a SWIFT code is, the Remitly app will help you so you don’t have to know the SWIFT code when transferring money. You can rest assured that the money will get there safely and quickly.