Opening a business bank account is one of the first things you’ll do when starting a new business. It’s also one of the most important. A business bank account will be your primary account and will be where you keep your company’s money. It’s also an account that lots of other people don’t have, which means it can help you stand out as an entrepreneur.
If you go into a branch to open an account, you may find that it takes longer than expected because banks need to know all about you personally before they let you open a business account. This is because they want to make sure there are no red flags. Here are some tips on what documents and information you should have ready if you want to open a business bank account:
What Documents Do You Need to Open a Business Bank Account?
There are a number of documents that you’ll need to open a business bank account:
EIN Number
An EIN (Employer Identification Number) is a number issued by the IRS to identify your business for tax purposes. You’ll need to have an EIN before you open a business bank account. You can apply for an EIN online. It costs nothing, and you can receive your EIN immediately. If you plan to hire employees in the future, an EIN is also necessary for contracting with partners and vendors.
ID Cards
When establishing a business bank account, you need to create a valid identity card or passport to verify your identity. You can use an ID card such as a driver’s license or passport as proof of your identity when opening a business bank account.
Business License
Getting a business license is required for certain types of businesses. Businesses that engage in retail sales, including restaurants and bars, must have a license. Businesses that sell goods or services must have a business license if they are located in the city or county where they are operating.
Business Contact Information
You may be asked for information about the business’s contact information, including the address of the company, the phone number, the name of the person responsible for the account, and the website of the company. Make sure everything is up to date, as this information will be listed on your bank statements.
Proof of Identity
You may be asked to prove your identity again and provide documentation of your name, address, and other information. This may be a bank reference letter, a utility bill, a government-issued ID card, or another document.
Company Formation Documents
Information about the business and its location should also be included in the documents submitted. It is a good practice to submit an incorporation document, incorporation agreement, articles of incorporation, and an operating agreement along with the other required documentation.
What Documentation Do You Need to open a Business Bank Account?
In order to open a business bank account, you will need to provide your Employer Identification Number (EIN) or Social Security number (SSN). You may also need to provide your business license, Articles of Incorporation, or DBA. If you are a sole proprietor, you will need to provide your social security number. If you are opening a business with multiple owners, all business owners will need to provide their SSN or EIN.
What is There to Consider When Picking a Type of Business Bank Account?
When picking a type of business bank account, you need to consider the type of business you have and what your needs are. The bank may also offer different types of accounts for businesses, so you need to find one that fits your business credit needs. You also need to consider whether you want a business credit card or not.
Business checking accounts offer basic features for business credit needs, such as check writing and electronic transfers, and are often the most popular accounts for businesses.
Business savings accounts offer various interest rates on a higher initial deposit. Generally, they don’t require a large number of transactions in order to earn interest on the account.
The Process of Opening a Bank Account
If you’re thinking about opening a bank account, there are a few things you’ll need to do first. First, you’ll need to gather the required documents. This usually includes a government-issued ID, your Social Security number, and proof of address. You may also need to deposit money into the account to meet the minimum balance requirements.
Once you have everything you need, you can choose which type of account you’d like to open. If you’re opening a personal account, you can usually do this online or in person at a bank branch. If you’re opening a business account, you may need to visit a branch in person.
When you’re ready to open the account, the bank will likely ask you to fill out an application and may run a credit check. Once your account is approved and open, be sure to keep track of your account activity and balance so you can avoid any fees or overdrafts.
Best Banks for Small Businesses
There are many different banks that cater to small businesses, each with their own unique offerings. However, not all small businesses have the same banking needs. The best bank for a small business depends on the specific needs of that business. For example, a small business that is just starting out may need a bank with low fees and easy access to credit. A small business that is expanding may need a bank with more robust lending options. A small business that is established and profitable may need a bank with comprehensive financial services. Fortunately, there are plenty of great banks for small businesses to choose from, so finding the right one should not be difficult.
Here are some popular banks to consider:
Capital One
Capital One is the best small business bank account for unlimited checking account transactions. This bank offers a variety of features and benefits that make it the perfect choice for small businesses. Capital One makes it easy to manage your finances on the go. Plus, you’ll earn interest on your balance and get access to a network of ATMs nationwide.
Wells Fargo
Wells Fargo is a great option for small businesses that need access to physical branches and business loans. They offer a wide range of products and services specifically tailored to small businesses, making them a great one-stop shop for all your banking needs. Additionally, their customer service is top-notch, so you can always expect to receive the highest level of service possible.
Chase
Chase is a great bank for small businesses because they offer a variety of bundled banking services. This includes a small business bank account, which is a great way to manage your finances and save money.
Bluevine
Bluevine is a great option for small businesses that are looking for a high-yield checking account. With this account, you’ll earn at one of the highest rates available. There are no monthly fees, and you can get started with a small deposit. This account is also FDIC-insured, so you can rest assured your money is safe.
NBKC
If you’re looking for a great small business bank account, NBKC is a great option. They offer free online business checking and savings accounts, which is a great benefit for any small business. Their customer service is also top-notch, so you can be sure that you’re getting the best possible service.
Digital Federal Credit Union
Digital Federal Credit Union is among the best credit unions for small businesses. They offer low fees, great customer service, and a wide range of products and services. Their online banking platform is easy to use and they have a mobile app that makes it easy to bank on the go. They also offer a wide range of business banking products and services, including business checking and savings accounts, business loans, and merchant services.
If you prefer a credit union because of its low fees, consider local credit unions. Most cities and towns have local credit unions where you can open a business bank account.
Congratulations on Taking a Big Step for Your Business
Opening a business bank account is one of the first things you’ll do when starting a new business. It’s also one of the most important. A business bank account will be your primary account and will be where you keep your company’s money. In order to open a business bank account, you may be asked to provide documentation that proves your identity, your residency, and your company’s formation. This is because banks want to make sure there are no red flags associated with the account.
If you’re ready to get started with a professional answering service, we’re here to help. Contact Answer Aide by calling (866) 427-3500 or by filling out our online form. We’re happy to partner with you to support your business while it grows.