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Updated Nov 01, 2023

Everything to Know About Business Checking Account Fees

Business checking account fees can eat away at your profits and affect your cash flow if you aren't careful. Before you choose a business checking account, make sure you know what fees it may charge.

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Donna Fuscaldo, Senior Analyst & Expert on Business Operations
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If you think business checking accounts are the same as personal checking accounts, you’re in for a rude awakening. Business checking accounts are more nuanced than individual checking accounts, and they tend to face more limitations and incur more fees than consumer accounts do.

Opening a bank account is essential for raising your business’s credit score. But whereas a personal checking account is usually free to use, a business bank account is often subject to a slew of fees. Indeed, these banking costs can potentially add up to hundreds of dollars a year — if you don’t know how to avoid them. 

What are the types of business checking fees?

When choosing a business checking account, you must be mindful of monthly or discretionary fees. Banks expect business owners to be more financially sophisticated than ordinary consumers, so you need to do your due diligence.

“It’s common for business checking accounts to have fees for services like wire transfers, large numbers of cash deposits, transactions or monthly service fees,” said Michelle Wright, group sales executive at Capital One.

The business checking fees you’re on the hook for depend on the individual bank’s terms. As a starting point, though, look out for these common fees:

  • Monthly service fee: This fee, which can be $8 to $30 a month, is charged to cover the maintenance of your business checking account. It is often waived if you meet a certain balance requirement or spend over a specific amount each month on the bank’s debit or credit card. Some online banks don’t charge a monthly fee for their business checking accounts.
  • Transaction limits: Some banks charge business customers a fee for any transactions over a certain limit. The limitations don’t end with the number of transactions; some banks require a minimum balance, and some charge a fee if a cash deposit exceeds a set dollar amount. Most banks have a limit of 200 monthly transactions on their business checking accounts. Some of the no-fee business checking accounts don’t place limitations on the number of transactions per month. On the other hand, some allow an even lower number of transactions — roughly 100 — before you incur this fee.
  • Cash deposit fee: Banks set restrictions on the amount of cash you can deposit each month. If you exceed that amount, they charge you for deposits, usually per $100 deposited above the limit. If you’re a cash-heavy business, weigh this fee when you’re shopping for a business checking account.
  • Nonsufficient funds (NSF) fee: The bank charges you when your checking account doesn’t have enough money to cover a transaction. The average NSF fee is around $35 per transaction.
  • Wire transfer fees: This is the cost to send money from one bank to another. It ranges from $15 to $25, depending on the bank.
FYIDid you know
If you keep more than the FDIC-insured limit in your business checking account, make sure you’re aware of strategies to protect your bank funds.

How do you avoid business checking fees?

The fees business owners face run the gamut, from monthly maintenance fees to insufficient funds charges. However, not all business checking account fees are etched in stone; you can use some strategies to avoid many of them.

“Many banks offer easy ways to avoid these fees,” Wright said.

If it’s a traditional bank, meeting the balance requirement typically removes the monthly service fee. Other banks waive the monthly fee if you use the bank’s business credit or debit card. The same goes for the transaction fee: If you stay within your limit, you won’t face extra charges. That strategy also applies to online banks that set limits on the number of transactions.

TipBottom line
Be sure to read more about how to apply for a business credit card if you don’t already have one.

Your banking needs will determine the best type of account for you, which means you’ll need to know how money comes in and out of your business.

“As a small business owner, it’s important to have a sense of how much money you expect to move through your accounts on a regular basis,” Wright said. “That way, you’ll be able to choose an account that works best for you. If you’re not running a lot of transactions through your business checking account, it may make more sense to choose a basic account, which usually comes with a lower monthly service fee.”

What are free business checking account options?

Popular ways to avoid business checking account fees are to sign up with an online bank or to use a financial technology startup’s platform. In recent years, fintech startups have disrupted traditional banks. Aiming to serve the small business community, these fintech companies are slashing fees, lowering requirements and leveling the playing field for the nation’s entrepreneurs. They may not have the deep pockets, extensive relationships or wide array of services that traditional banks offer, but they are applying automation and machine learning to cut costs and improve customer service.

Did You Know?Did you know
Many new online banks don’t charge monthly account fees.

These online banks may not appeal to all businesses — after all, they offer no local branches or human interaction — but they are racking up thousands of customers seeking cheaper alternatives.

“Businesses shouldn’t pay to open a business checking account,” said Kathryn Petralia, co-founder of Keep Financial. “New online-only products eliminate much of the overhead traditional banking accounts require and therefore pass those savings on to customers by eliminating maintenance fees, minimum balance fees and similar costs. Find a product that supports your growth, not hinders it.” [In the market for a business loan to boost your growth? Check out the small business loan lenders we recommend.]

With that in mind, here’s a list of some popular free business checking accounts and what they offer:

  • Bluevine offers a business checking account with no monthly fees and unlimited transactions. Customers earn 2% interest on their balance up to $250,000. Bluevine doesn’t have any limits on transactions or a minimum balance requirement.
  • Novo offers a business checking account with no hidden fees or minimum balance requirements. The bank will also refund all ATM fees. 
  • Axos Bank doesn’t charge a monthly maintenance fee, and it offers access to a surcharge-free ATM network. There is no minimum balance or initial deposit requirement. 
  • NBKC Bank has no minimum balance requirement, per-item fees or NSF fees. The bank doesn’t charge overdraft fees or fees for returned electronic or paper items. 

Both traditional and online banks have advantages and drawbacks, so it’s up to you to choose which is better for your business checking account. Either way, it’s important to do your research, especially on fees, before you settle on a business banking partner.

“Some people appreciate the in-person relationship with banks, which has become more difficult during the pandemic,” Petralia said. “Other business checking accounts are optimized for efficiency online, reducing costs and increasing yields. Every business is different, and preferences vary. But the banking options … are far different than they were even two or three years ago. I’d encourage all businesses to get to know their options.”

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Donna Fuscaldo, Senior Analyst & Expert on Business Operations
Donna Fuscaldo, who has 25 years of experience navigating the convergence of business, finance, and technology, is a trusted advisor to small business owners. Her expertise in business borrowing, funding, and investment strategies equips her to provide reliable counsel on everything from business loans to accounting and retirement benefits. Her analysis has graced publications like The Wall Street Journal, Dow Jones Newswires, Bankrate, Investopedia, Motley Fool, Fox Business and AARP, solidifying her authority in the field. Beyond her contributions to the financial landscape, Fuscaldo also lends her wisdom on employment matters, with her expertise sought after by platforms like Glassdoor and others. Armed with a bachelor's degree in communication arts and journalism, Fuscaldo has the unique ability to simplify complex business and career-related topics into actionable insights. This makes her a valuable resource for professionals seeking practical solutions in today's dynamic business environment.
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