When starting a small business, it’s important to be knowledgeable of all the things that you need to get your company off the ground.
While it’s obvious that you’ll need to understand tax laws, how to hire employees, and what laws regulate your industry — we’d be remiss not to include the importance of opening business bank accounts.
There are several kinds of business bank accounts you will want to look into when getting started, and each one will serve a different purpose.
Keep reading to learn more about the different kinds of business bank accounts you can open when starting a small business!
1. Savings Account
A savings account is a type of account held at a bank or other financial institution that provides a place to store money and earn interest. The account holder typically makes regular deposits into the account and withdraws money as needed. A savings account can help businesses save money for future expenses or goals, and the interest earned on the account can provide a source of additional income.
2. Current Account
A current account is a type of bank account that allows businesses to deposit, withdraw, and transfer money regularly. Current accounts are typically used for everyday transactions, such as:
- payroll
- invoicing
- bill pay
Most businesses will have a current account with their main banking provider, as it is the simplest and most convenient way to manage their finances.
However, there several alternative providers that offer current accounts with special features and benefits. For example, some alternative providers offer interest-bearing current accounts, which can help businesses earn a little extra money on their deposited funds.
3. Business Checking Accounts
There are a few different types of business bank accounts, but business checking accounts are the most common. When you open a business checking account, you’ll be able to:
- deposit money
- write checks
- make electronic payments
This type of account is perfect for small businesses that need to manage their finances on a day-to-day basis.
There are a few key reasons why having a separate checking account for your business is a good idea. First, it helps to keep your personal and business finances separate. This can make things simpler when it comes time to do your taxes or other financial planning.
Second, a business checking account can help you track your business expenses and income more easily. This can help manage your business finances and budget. Having a separate checking account can give you access to special business banking services and products, such as business loans and lines of credit.
Know Which Business Bank Accounts You’ll Need
No matter what type of business you have, you will need a business bank account to help you manage your finances. There are different types of business bank accounts, so it is important to know which one is right for your business.
Among the most common types of business bank accounts are business savings accounts, business current accounts, and salary accounts. Each type of account has its benefits and drawbacks, so it is important to choose the right one for your business.
For more informative facts about business banking, visit our main blog page.