Why Should You Switch Your Business Bank Account?

Posted on 6th April 2023

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Any legally registered business can apply for a business bank account. Most high street and fintech banks, as well as larger building societies, offer business accounts.

Finding the right bank account for your business is vital. You may already have a business account, but there could be others out there that are a better fit for your needs.

Here are some of the more common reasons people switch business bank accounts:

Features and benefits

Each account will offer different features and benefits. You should take the time to understand what will be most useful to your business.

Some providers give you access to an adviser, or to a business manager, and others offer investment services. Some give business account holders access to external software that can assist with invoicing and accounts.

Business bank account fees

Some business accounts charge fees. For example, providers may charge a monthly fee for having the account, with additional fees for certain services like transactions and payments. Other providers may only charge for some of these, or for none at all.

While it’s tempting to switch for a lower fee, bear in mind that if the account comes with additional benefits, the higher fees may be worth it.

Accessibility

You may choose to switch your bank account to a provider with better online services. With challenger banks rising in popularity, online banking has seen major advancements over the past few years. On the other hand, you may want a provider with more branches local to your business. Many people still value a face-to-face approach.

Switching deals

Often, providers will offer certain perks or incentives to encourage you to switch your account to them. This could be in the form of cashback or reduced fees for a period of time. These deals can be tempting and are definitely worth investigating when you’re looking to switch. However, the features and accessibility of the account, as well as any regular fees should be a higher priority – especially as many deals will only run for a set amount of time after you switch.

Choosing the best business bank account

All of the above-mentioned aspects should be used to determine the best business bank account for your circumstances. However, it’s important to check customer reviews to ensure that the provider is reputable. If you encounter any issues with your new account, you want to be confident that the provider will resolve these professionally and efficiently.

How to switch business bank accounts

Switching accounts is relatively simple if your new provider is part of the Current Account Switch Service. Luckily, most big-name banks are. The service allows your provider to handle most of the process for you.

Each bank account will have its own eligibility criteria. This could be a minimum or a maximum number of employees or annual turnover. Make sure you can meet these requirements before applying for your new account. You will be required to supply certain documentation when setting up your account, so check what is needed ahead of time. Bank statements from your existing account will not be transferred when switching. Be sure to gather these prior to the switch.

Once your new account is created, you can choose the date you would like the switch to happen. This date can’t be a weekend or bank holiday. You must also allow at least seven days for the switch to take place. When you’re ready to start the switch, inform your new provider and they’ll take it from there. Continue using your existing account until your chosen date. On this date, your previous account will close and the new one will activate. All funds and payments will have been transferred over.

Using the switch service, you’re covered by the Current Account Switch Guarantee. This means if any interest is lost or charges are made due to a problem with the switch, you’ll be refunded.

If you used customer reviews to help you choose your new provider, consider leaving a review yourself. It can be difficult to navigate the world of financial services, and getting your business’s finances right is crucial. Share your experience with others to help business owners like you make informed financial decisions.

Jacqueline Dewey is CEO of Smart Money People, the UK’s dedicated financial services review site.