Small business banking: finding a business bank account

Small Business Owner

Whether it’s a sole trader, partnership or incorporated business, there are a variety of business bank account options provided by banks that are tailor-made for small business owners. The fees and charges associated with business bank accounts can be a bit of a trap, however. As with any business decision, it pays to shop around for a business bank account that is competitive to make sure your money stays with the business and not with the bank.

Opening a business bank account

Most banks give you the option of applying for an account online, so it is relatively simple to get started, and the application process is certainly made smoother if you have your documents in order before you apply.

You will find that the banks usually have at least five different types of banking accounts that have been created to cater to different types of businesses. Take some time to get familiar with what’s on offer so you match your business to the right the product. Once you have found an account to suit your needs, to open a business bank account, most banks will require you to provide an Australian Business Number (ABN). You can apply for an ABN online for free through the Australian Taxation Office's website.

Each bank has different requirements from businesses looking to set up a bank account. Most provide details on their websites of what they need from you. To speed up the process go in prepared, with your information in order and with a smile; patience will get you a long way. Banks can be very particular when it comes to business banking so try not to get frustrated by the process.

Things to look out for

  • The currency conversion fee, this would be important if you do a lot of trading online and/or overseas
  • Fee for using cheques
  • Option of a MasterCard or Visa debit card, making everyday transactions easier, as well as the option to use the card online like a credit card
  • Monthly account keeping fee
  • Transaction fees and limits, including over-the-counter transaction fees or fees for going into the branch
  • Opening hours of your local branch. This varies between banks, some open later on weekdays, while others also open on weekends
  • Whether or not the account allows for batch payments
  • Interest rate for deposits, if you are dealing with large sums of money, you could be missing out on earning extra income from interest if you don’t use a high interest account

Business Savings Bank Accounts

Westpac Business Cash Reserve
$0 monthly fee, 2.75% Interest on balances over $10,000, must be linked to a Westpac transaction account, unlimited transfers between these two accounts.

ING Direct Business Optimiser
$0 monthly fee, 4.5% Interest rate for the first 6 months, then 3% after that period, on balances over $10,000.

Business Transaction Bank Accounts

St.George Freedom Business Account
Suitable for businesses that do most transactions electronically. 15 branch and cheque deposits and withdrawals a month. Optional Visa business debit card. Unlimited electronic transactions. $5 Monthly fee.

St.George Business Cheque Account Plus
Suitable for businesses that do a lot of transactions each month. 50 branch and cheque deposits and withdrawals a month. Optional Visa business debit card. Unlimited electronic transactions. $15 Monthly fee.

Westpac One Account (High Plan)
Best suited to businesses that transact frequently. 321 electronic transactions or 90 cheques or 45 branch transactions allowed each month. $15 monthly fee.

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