As the number of different banking options is increasing, businesses are faced with the challenge of selecting the most suitable option. The growing market also has developed a one-size-fits-all approach for companies. However, this approach has proven to be a disadvantage for startups as many large banks and other financial institutions have developed standards and requirements that do not suit startups. The non-supportive system leads to the diminishing of startups’ success.
To help you find the perfect match, we have created a list of factors to consider when looking for a bank account for your startup.
Suit your needs
Although it seems obvious that you should look for a bank account that suits your needs, many startups fail to recognize the meaning of this. Your chosen bank should understand elements of your business like the business model, clientele, and what transactions to expect. If the bank has little understanding of your business model, then you are bound to run into financial complications.
Depending on the legal structure of your startup, you will need to comply with the regulations of the chosen bank. For example, some banks prohibit offshore startups from having a European bank account. However, some banks still offer such services. Before onboarding to a bank, make sure that you understand the regulations that your company must comply with.
For any startup, it is important to be able to transfer and receive money. If you are an online startup or just dealing with international clients or partners, it is vital that your corporate account can transfer and receive funds in different currencies. This is a common issue that startups face in the long term as many banks can support few specific currencies.
Fast account setup
As a startup, you value time more than anything. The speed and simplicity of how you can open a bank account should be your top priority. You should take into consideration the expected timeline and whether you have to physically visit the branch for documentation approval. Today, this process has become more customer-friendly with the help of Fintech. Most online banking institutions allow for digital document submission. Also, some online banking institutions review and approve your submission in just a few days rather than weeks.
We all hate to see chunks of money being taken away in every transaction. As a startup that operates internationally, you should look for a bank account with little transaction fees that can be reduced over time. Try negotiating with a financial institution that once you reach a certain threshold, you get different rates and fees.
No monthly fees
Fees are the burden of startups. Just way too many fees can undermine the success of your startup. Of course, you will not find a bank account with zero fees, however, you should look for bank accounts with no monthly fees. The ongoing charges should be waived for meeting the minimal requirements. For example, you may try to negotiate with the financial institution that your monthly maintenance fees are dismissed if you keep at least $2000 in the bank account.
Online portal and mobile app
People understand the value of simple, fast, and secure virtual banking. As a startup owner, you should be able to access your bank account from anywhere and anytime. You should be able to manage your financial operations without making necessary stops at physical branches.
Bonus: simple software integration
As obtaining a bank account can be a painful process, no one likes to do it more than once. As a startup, you should also think about the benefits in the long term. One important factor, once your startup grows, is the availability of integrating different software into your corporate bank account. You will need payroll, accounting, processing, and automated payments integrations to make your business operations more effective and efficient. Ask financial institutions about those possibilities from the start, as finding new options will be difficult.
It might seem easier to use your personal account for your startup operations, however, having a business account is a better idea. While the process can be irritating at some points, there is definitely a solution to easing the process and obtaining the desired results.