Choosing the best business banking account for business needs can be challenging.
With so many different types of business checking accounts, all with varying fees and benefits available, it’s easy to get overwhelmed.
One thing you know for sure: using a personal checking account for business is not an option.
So what do you do?
Fortunately, there are certain accounts that are designed to meet the financial needs of businesses.
These accounts offer a range of features from free transfers and access to credit cards to interest-free overdrafts and cash management services.
To help you decide which business checking account is right for your business, here’s my recommendation on the best business checking account online!
Hello, hello, Jamie Trull here, your favorite CPA and financial literacy coach.
Transcript has been edited for readability.
Today we are talking about business banking and specifically what business banking platform I recommend that you use and why.
Okay, so I’m gonna tell you a little bit about the banking platform that I use, and it just rolled out some amazing new features that I wanna make sure you’re aware of.
My Favorite business bank account
I use Bank Novo.
Now Bank Novo is a FinTech company.
So what that means is it’s a banking platform, so that’s what the app on your phone is going to be.
And it is connected to Middlesex Bank, which is out of Massachusetts I believe. And it is FDIC insured up to $250,000.
So it is safe, but these FinTech companies are the type of companies that are more tech companies.
They help make it so that you can reach everything on your phone super easily.
You need a basic business checking account – not a personal checking account
I really like these FinTech companies and also they’re fully online banking.
So that’s kind of rule number one.
If you need cash, you need to be able to have a checkbook.
Now, there is a way that you can still send checks even without a checkbook.
However, if you need a physical checkbook in your hands or if you need to be able to deposit cash, then bank Novo is probably not right for you.
But if you are primarily receiving and paying things online, then likely this business checking account might be something that you could use and it’s totally, totally free.
Business checking accounts can be free
So that was number one. Rule number one, when I was looking at different business checking account options, they had to be free.
Most big banks do charge you fees for banking with business bank or for a business checking account.
Maybe they have minimum balance requirements. Or they have certain limits on transactions, and that drives me bananas.
It was key to me to find a banking platform that did not have extra fees.
I did not want a business checking account that had transaction minimums and maximums that you had to be paying attention to.
No, thank you at all. Not interested.
So now I wanna get to why I love Bank Novo so much and what these new features are.
And these are features that I have been asking for in a business checking count.
I’ve been looking for them, and there are no banks that have them.
And they’ve actually kind of added on to some of the business bank account features that caused me to choose Bank Novo in the first place.
I was searching for a business checking account to replace my previous bank’s business checking account.
That was Azlo Bank, and then they closed.
So I really, really wanted a virtual envelope system, meaning I wanted to be able to open up multiple different sub-accounts for different purposes.
Then I could put money into as sort of a way to reserve that money to put it [kind of like online cash deposits] in different envelopes for different purposes.
For instance, for things like taxes, right?
As business owners, as freelancers, as entrepreneurs, we have to pay our own taxes.
And so I wanted to be able to kind of segregate that into a separate place but not have to go open up a whole bunch of different bank accounts.
So if you’re doing something like Profit First, right?
This type of thing would be great for you.
You can still get the benefits of having various business checking accounts, without actually having to go open different checking accounts.
Novo gives you just one business checking account, but you can move money seamlessly and instantly between these different envelopes or reserves or whatever.
What do you want to call them, sub-business bank accounts, right?
You can move unlimited transactions instantly between them, with no minimum balance requirements.
So one of the big changes too is that they made the business checking account such that you can now have 10 reserve accounts.
The small business checking account used to be limited to five. I actually have six types of checking accounts (or sub-accounts!) that I like to use.
So that drove me crazy.
I had to put two together and then I had to track transactions per sub checking account on my own little spreadsheet so that I knew what the balances in each of these different accounts were.
But I no longer have to do that anymore!
I can have up to 10 sub-accounts for free in Novo.
Okay? And I’m gonna show you exactly how to create a sub-account when you get into your Novo app.
So you can see here I’m creating a reserve, I’m calling this online banking superstar my Rainy Day reserve, and I am putting a description that it’s my emergency fund, right?
This is the amount that I’m going to save for emergencies.
It tells me my available balance that’s in my total checking account, and then I can decide how much to put in it.
And now this is brand new y’all.
This way, you can actually automatically assign a percentage.
So if of all the income that comes into my checking account, let’s say I wanted 2% to go into this emergency fund, it will automatically do that when money gets paid into my account.
Now remember, this is all gonna happen automatically.
If you decide you want to move an amount out, you can easily, seamlessly, instantly move the money out of the reserve.
But this helps you if you’re somebody that likes to automate, right?
And I definitely recommend automating as much as you can when we’re talking about business and personal finances, because it’s going to help you, again, if you set this up for taxes, right?
Novo’s banking services are gonna automate and set aside maybe 20%, 25%, whatever you want to do for taxes or monthly fees, depending on your business.
You can automatically have your bank set that aside for you into these reserve accounts, which is fabulous.
The next thing I wanna show you are some additional updates for business checking accounts that just rolled out in Novo.
I’m recording this video in July of 2022, but likely these are all still out there and have rolled out to you.
So what you can see here is that they’re saying: Hey, we’ve made, made big changes, and they’re automatically allocating those reserves.
So like I just said, you can make payments directly from those reserves so you don’t have to move things back into your operating account to make an ACH payment.
You can do it per cycle, directly from the reserve, which is also awesome.
And you can track expenses by assigning transactions to a reserve checking account.
So you can actually go ahead and assign various different transactions to the reserve that you want them to come out of.
This small business bank account is automatically gonna track it from you.
It’s not going to be deducted from your reserve.
So previously, if you didn’t have enough money in your available balance and you spent more than that, it would automatically deduct from the minimum balance whatever the top reserve was.
It doesn’t do that anymore, it’s gonna show it as negative. It’s not actually going to be an overdraft, okay?
It just means you have to pull from a reserve to then cover that available balance.
So if you use something like yab, it’s actually pretty similar to using an app like that.
YAB is you, you need a budget.
Some people would do the Profit first methodology or my profit planning.
I also teach a separate thing that has some similarities to Profit First, but is different in a lot of ways.
And so they would use something like yab, which is a personal budgeting tool.
They would use it for the best business checking account because this type of functionality within a business bank account did not exist.
But now Novo’s business checking account does, and I am so, so excited about it.
Now, I always try to be fair in my reviews, and obviously I use Bank Novo, I like Bank Novo.
However, that doesn’t mean it’s perfect, right?
Why Bank Novo isn’t the perfect online bank for your business checking accounts.
So I want to be clear about a few things that I don’t necessarily love or some things that they’re very important to you that you might not want to go with Bank. Novo.
So a couple of those things.
One of the things, again, like I mentioned before, is you can’t deposit cash and you can’t write checks.
You can send checks directly from the Novo app and Novo will send those out for you.
So it is still possible to send out checks, you just can’t have a physical checkbook to do it like you would with a brick and mortar bank.
It is fully online. So you wanna feel comfortable with that and understand how to navigate business checking account services online.
You don’t have a local Bank of America branch to go walk into when you have an issue with your business checking account.
And that is one of the things that I think is not my favorite about Novo is that customer service, like a lot of these fintechs, it’s not the easiest to get a hold of.
(Not that Bank of America is either!)
An online small business checking account can be a little bit frustrating sometimes for a business owner, okay?
I also don’t love that when you first join, and this is true with other banks as well, but when you first join, it seems like they set lower limits and things like that for your transactions.
They have longer hold times typically on the money coming in and out of your account, which can be frustrating when you wanna get it right away.
Now, once you build up trust and you have been with them for a little while, that starts to get faster and faster.
Again, that’s true with a lot of banks.
They tend to have these security measures for even the most basic business checking account, and as they trust you, then that is going to get better and better.
And additionally, they finally rolled out, and I’m so glad of this too, a way to request a transfer limit.
So you can request if you need a higher daily limit, if you need a higher monthly limit or per transaction limit, right?
You can request that directly on the app.
It used to be that you had to kind of chat with them and then they would usually do it pretty quickly.
You can also request that to be temporary. Which you then don’t have to show any support or anything for.
Or if you want it to be permanent, they do ask for, you know, invoices, something to show that you need that to be done.
Now, I’ve never had an issue getting those increases, those permanent requests handled.
So it is a little bit frustrating because you know, if you want to, you know, make sure that you have those higher limits from the get-go, it can be frustrating.
The other thing I don’t love about it is that you don’t get any interest on your business checking account.
Novo’s small business checking account doesn’t earn interest.
Like a lot of business banking accounts, this is not necessarily a savings account, it is a business checking account, so it’s not going to have interest like personal accounts.
There are some other business banking specifically savings accounts that you could open up on the side of this too and earn some interest for the amounts that you are saving.
But for me, again, the toss up between the interest that is fairly negligible that I would be earning on business checking.
Especially compared to being able to actually have this amazing sub-account business checking account structure with reserve accounts where I can put things into envelopes and use them as I need them.
That to me is more important than all of those other features and those banking services has worked wonderfully for someone like me.
Okay, so if you want to jump into Bank Novo, I do have an affiliate link.
This is the online banking solution your business has been looking for!
Unlimited free transactions; a separate business bank account that you can then create sub accounts within; Receive customer payments easily and so much more!
I do make a little bit of money off of each of these.
I’d love for you to use my link. If you do decide to sign up.
It does support my small business as well as open a business checking account.
And so I thank you very kindly for that.
But in addition, if you use my JamieTrull.com/novo link, I’m gonna send you a free gift.
(email [email protected] when you fund your account to get your free gift totally free!)
So once you do that, once you sign up and get approved for your account, and you fund your account, then email us at [email protected].
We will check the records, assuming we see your name on our list, then we are going to send you a free gift of our own.
I’m actually going to be GIVING YOU my tax time bundle if you use my link to sign up for Novo, which is worth $149 … at no cost!
That’s what our Tax Time Bundle sells for on our website.
It has lots of things on the checklist, help you save taxes at tax time.
These are really geared towards small business owners, entrepreneurs, and freelancers.
It has a mini course associated with it to help you quickly get ready for taxes.
So if tax time is something that makes you wanna pull your hair out, then this is something that you are gonna wanna have in your tool belt.
It has a couple of awesome worksheets.
I’m known for my plug-in play worksheets, so you can get those too, so that you can track your finances really, really easily.
So all of that, that is free business checking.
Again, email us if you do use that Novo link.
Once you have funded your account, we will send that to you for free.
So you can’t beat that, right? So hopefully you found that helpful.
We have lots of additional resources out there for small business checking accounts.
Regardless of the account you decide to choose for your business, signing up for a free Novo Checking account is a great option.
With no monthly fees and unlimited transfers, along with access to a suite of business solutions and cash management services, Novo Checking is a straightforward business checking account that can help take the stress out of managing your business finances.
Sign up now and start taking advantage of all the features Novo Checking has to offer.