Ask These 4 Questions Before Getting a New Small Business Bank Account

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Ready to switch to a new bank account? Read on to see how you can make sure you’re choosing the right one. 

Being a small business owner means being tasked with numerous decisions. Should you raise wages for full-time employees? Should you expand your product or service line? And it is time to swap your current bank account for a new one that will better serve your needs and perhaps make your banking experience a lot smoother?

Moving to a new bank could work to your benefit and make it easier to run your business. But before you open a new small business account, make sure to run through these key questions.

1. What special services and features does this bank account come with?

Some banks offer benefits like free payroll management tools and remote check deposits. Other banks allow your account to integrate seamlessly with accounting or bookkeeping software so it’s easier for you to maintain solid business records. Do some research to see what special perks you’ll be privy to as a new account holder.

2. Is there a minimum balance requirement?

It’s a good idea to leave yourself with a cushion in your bank account in case there’s a period when clients are slow to pay their bills and your expenses come in higher than expected. But you also don’t want to get stuck having to stash too much cash in your bank account.

After all, that’s money you may want to use for other things, whether it’s marketing, equipment, or employee bonuses. Find out what minimum balance you’ll be on the hook for before opening a new bank account and make sure it’s not a problem.

3. Is there a daily or monthly transaction limit?

The median small business has average daily cash outflows of $374 and average daily cash inflows of $381, reports JPMorgan Chase. It’s common for businesses of all sizes to engage in numerous transactions per day.

But some bank accounts limit the number of transactions that can be processed in a day before a fee applies — or limit your daily transactions, period. Others impose monthly limits. If you tend to do a lot of transactions, then this is something you’ll need to be mindful of and check on before opening a new account.

4. Is the nearest branch conveniently located?

There are certain banking matters you may need to tend to in person. And if yours is a cash-heavy business, you might want easy access to a branch so you can deposit those piles of money into your account without having to hang onto them overnight.

That’s why it’s important to consider the location of the nearest branch that’s available to you. And also, look at the hours. You don’t want a branch that closes so early that getting there won’t be feasible based on your schedule.

Opening a new bank account for your small business is something you’d probably rather only do on occasion — say, every few years, if that. So it’s important to choose the right account from the start when you’re making a switch. If you make a point to answer these questions before signing up, you may be quite happy with the new account you end up with.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.

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