This article contains general information and is not intended to provide information that is specific to American Express, or its products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.
Routinely reviewing business expenses — and trying to reduce or eliminate them — may be a key way to help you manage cash flow and control expenses. One area to consider focusing on is business banking costs. Choosing the right bank and type of account could be a relatively small shift in your business practices that could help support your budget.
How to Find a Bank Account That Fits Your Business
You may need a business banking account to pay vendors, cover operational expenses, and receive payments. The key is finding an account that's right for your business and may help keep potential fees to a minimum.
The size and type of business — and your banking needs — may influence the fees you pay. Also consider things like how much cash you intend to keep on hand, your expected transaction volume, and whether you might need to open a business line of credit.
If you prefer in-person interaction, a brick-and-mortar bank might meet your needs. But if you're comfortable with a fully digital experience, an online bank could deliver what you need in terms of features and fees.
How to Potentially Minimize Business Banking Costs
Saving money at the bank may be a matter of applying some practical steps. Consider the following to potentially help reduce business banking costs.
Consider a Bank With Low or No Fees
One way to potentially minimize what you pay for business banking is to choose a bank that charges low or no fees. If you already have a business account, this might mean changing banks, but it may be worth the effort if you end up paying less for more features.
Start by looking for an account with no monthly maintenance fee. Then review the rest of the bank's fee schedule. For example, what is the cost of domestic wire transfers and ACH transfers? Will you pay a foreign transaction fee or foreign ATM fee?
Even small fees could add up. A little number crunching might go a long way towards reducing your business banking account costs.
Link Business Accounts
Linking business accounts could help you avoid bank costs if your bank waives the monthly fee for doing so. Some banks eliminate monthly costs if the combined balance across all accounts exceeds a certain threshold. Maintaining a higher balance in savings could help offset a lower checking account balance that might otherwise require a fee.
Linking accounts also may give you the ability to transfer funds virtually when needed. If you notice your business checking balance is getting a little low, for example, you could move some money from savings to top things up. That could keep your account in the black — and help you avoid overdraft fees if your bank charges them.
Keep Accounts Active
Some business banking account costs may apply when you don't use your account, rather than when you do. These inactivity or dormant account fees may apply when a certain amount of time has passed since your last transaction.
For example, you might receive a dormant account fee for a business savings account that has no new deposits or withdrawals in the space of 12 months. A potential way to help avoid this fee is to have some type of recurring activity set up for accounts you use less frequently.
If you have business banking accounts you have stopped using, you might want to consider closing them and consolidating the balances into other active accounts with low or no fees.
Track Transaction Limits
Some banks offer business accounts with zero transaction fees, which might apply to everyday needs like bill payments or transfers.
If your bank charges this fee and switching to another bank is not an option right now, consider reviewing your transaction limits. Try to pay attention to how many transactions are permitted each month, what dollar amount limits may apply, and what you'll pay for each transaction over the limit.
Consider tracking your transactions to help ensure you stay under the limit and avoid fees. Setting up banking alerts each time a new transaction occurs could help make this task easier.
Watch Payment Timing
Cash flow may affect your business banking costs. For example, if there's a lag between when you pay your vendors and when your customers pay you, that could result in fees if you don't have enough cash on hand to cover your expenses.
Reviewing how you manage accounts payable and receivable could further help you potentially avoid fees if deposits and withdrawals move in tandem. You may also be able to avoid or reduce late payment fees by planning ahead for bill due dates.
Go Digital If Possible
Some business banking transaction costs may be easy to overlook. Paper statement fees or ATM surcharge fees, for example, may be just a few dollars each, but that's still money flowing out of your business.
Enrolling in paperless statements and taking advantage of digital banking tools may help you avoid certain costs. Consider looking for a bank that offers a robust mobile app, with online banking as a back-up option. Key features to look for could include no-fee mobile check deposit, no-fee internal and external account transfers, and a fee-free ATM locator tool.
Review Statements Often
Reviewing your bank statements regularly could be a way to potentially spot business banking account costs that might affect your balance. Whether you get paper statements or view them electronically, try to take time to review each fee your bank charges and consider if there are ways you could reduce or eliminate them.
Building Consistent Savings Habits
By taking a proactive approach to managing your business banking costs, you might be able to not only reduce or eliminate fees but also to create or increase an emergency fund or pay for a new initiative for your business. A business budget is another tool that may help you implement your savings plan. Learn how to create a workable business budget, step by step.
Consider American Express® Business Banking
With Amex® Business Checking and Amex® Business Savings, keep more of what you make with no minimum balance or monthly fees, plus Membership Rewards® points and APY, all with 24/7 support from specialists. Terms Apply. Deposit Accounts offered by American Express National Bank. Member FDIC.
Learn more about American Express® Business Banking.
Photo: Getty Images
The material made available for you on this website is for informational purposes only and is not intended to provide legal, tax or financial advice. If you have questions, please consult your own professional legal, tax and financial advisors.
Terms and Conditions
Terms and Conditions for the Membership Rewards® program apply. Visit membershiprewards.com/terms for more information. Participating partners and available rewards are subject to change without notice.
The value of Membership Rewards points varies according to how you choose to use them. To learn more, go to www.membershiprewards.com/pointsinfo.
