As a small business banking can be expensive and difficult to find the right account for you and it is probably low on your priorities list.
Finding a free business bank account is a great way to keep your costs down and if you don’t mind switching accounts you can continue to receive free banking by moving accounts every 18-24 months.
This guide gives you the details for the best deals for free business bank accounts from the leading banks through to the lesser known providers.
The table below gives a quick comparison of the top UK free business bank account providers.
|Company||No of months free for new businesses*|
|Lloyds Bank||18 months new businesses only|
|Metro Bank||Permanently no account maintenance fee as long as balance stays over £5,000|
|Bank of Scotland||6 months new customers or 18 months for start-up businesses|
|Yorkshire Bank||25 months|
|Cooperative Bank||30 months|
|Clydesdale Bank||25 months|
|Tide||Permanently no account maintenance fee|
|Starling Bank||No monthly fee as long as you have your account|
|Coconut||Start plan is free and grow plan is £5/month|
|Counting Up||Starter plan is free for businesses with under £750/month in revenue|
* The prices included here come from each company’s website and were accurate at the time of writing (July 2019) but may have since changed. Also, please keep in mind these may not be apples to apples comparisons as each provider charges different fees for different transactions. This guide should be used as a starting off point for more research on your part.
Below we profile each company’s plans and features in a bit more detail.
1. Lloyds Bank
Some of the features and benefits of Lloyds Bank’s free business bank account.
- 18 months free business day-to-day banking for new business start-ups
- Free electronic payments
- Free cheques and cash withdrawals/deposits
- Simple pricing
- Dedicated support from the UK-based business management team
- Additional financial support including loans, hire purchase, overdrafts, invoice finance and credit cards
- Mobile business banking app
- Guides to support businesses
- Access to financial and digital tools
- Eligible for sole traders, partners or company directors
Lloyds Bank is part of one of the largest banking providers in the UK, Lloyds Banking Group, and the group is formed of Bank of Scotland, Halifax, TSB, and Scottish Widows.
Lloyds Bank offers a free introductory day-to-day business account offer to new business startups. To be eligible the person opening the account needs to be a sole trader, partner or company director.
Once the free banking period ends you will be placed on their standard business current account tariff which still offers free electronic payments, cash withdraws from a cash machine and paying by debit card. Monthly account maintenance fee is £6.50 after the free period.
2. Metro Bank
Some of the features and benefits of Metro Bank’s free business bank account.
- If the daily balance is over £5,000 there is no monthly account fee
- Over £5,000 balance gives you 50 free transactions per month
- No charges for transactions in many European countries
- Stores are open 7 days a week
- No appointments necessary in branch
- Local Business Manager
- 24/7 Customer Support team
- Flexible banking over the phone, online and in store
- Mobile app
Metro Bank offers a different style of banking for businesses that do not operate 9 to 5 as they are open 7 days a week not just online or over the phone but in store as well where appointments are not needed.
To take advantage of Metro Bank’s free banking offer you will need to keep your daily balance over £5,000 for every day in the month. If your balance goes below £5,000 the standard monthly fee of £5 will be applied to the account for that month. With this offer, you will also benefit from the first 50 transactions free although some transactions such as international payments, CHAPS payments and an Auditor’s Certificate of Balance are chargeable.
3. Bank of Scotland
Some of the features and benefits of Bank of Scotland’s free business bank account.
- Free day-to-day business banking for new customers for 6 months
- Free day-to-day business banking for new business start-ups for 18 months
- Easy switching process that will complete in 7 working days using the Current Account Switching Service
- Simple pricing
- No charge for electronic payments after the free banking period ends
- Business support available in branches, over the phone and online
- Support for new start-up businesses and small businesses to help them grow
- Flexible banking available in branch, online and over the phone
- Mobile banking and text alerts
Royal Bank of Scotland offers free day-to-day business banking to new customers switching to them for 6 months and new start-up businesses for 18 months. This includes most transactions. After the free banking period ends the account maintenance fee is £6.50, but you still get free electronic payments, cash withdraws from a cash machine and paying by direct debit.
Their business bank account has a simple pricing structure and an online calculator to help you work out what the account will cost you once the free period ends.
Royal Bank of Scotland also offers a range of other financial support for businesses such as loans, hire purchase, overdrafts, invoice factoring and charge cards.
4. Yorkshire Bank
Some of the features and benefits of Yorkshire Bank’s free business bank account.
- Free day-to-day business banking for 25 months when you switch to them
- Free day-to-day business banking for 25 months for new start-ups
- Basic account management for everyday business banking needs
- Optional agreed overdraft
- Supportive bank who wants to help its customers to grow
- 24/7 access to your bank account online
- Mobile app to manage your account whilst anywhere
- Current Account Switch Guarantee
Yorkshire Bank’s free day-to-day business banking offer is available to businesses who are wanting to switch their current account or to new business start-ups. To be eligible you must have a turnover below £2 million per year. New businesses must have been operating for less than 12 months.
Most transactions are free but there are a few that are still chargeable which include international payments and CHAPS payments, and there are some limits on cash withdrawal and deposits.
At the end of the free banking period, customers are moved on to the business banking tariff which charges a monthly account charge of £5 per month. All transactions occur a charge between 30p-£1.30.
Some of the features and benefits of HSBC’s free business bank account.
- Free day-to-day business banking for 12 months for new customers
- Free day-to-day business banking for 18 months for new business start-ups
- After the free period, you will get 12 months fixed banking with no transaction fees
- Choice of two business current accounts after the 12 months fixed period
- Best Tariff Promise to review accounts annually to ensure you have the best tariff
- Access to finance and borrowing to fund expansion or improve cash flow
- Access to your account in branch, telephone, internet and mobile banking
- Access to deposit cash or make withdraws at Post Office branches
- Access to their online Knowledge Centre for support
- Access to Business Specialists in branches across the UK
HSBC offers both new customers and new business start-ups a free day-to-day business banking period that lasts 12 months for new customers and 18 months for new business start-ups. All customers at the end of the free banking period are switched to their fixed price tariff which gives 12 months free transactions (excludes cash deposits over £3,000 per month) with a monthly account fee of £5.50. After this period, you will be switched to one of their two current accounts.
The Electronic Banking Tariff is most suited to business who predominantly do business electronically. The Small Business Tariff is most suited to those that have more cash-based transactions. Every year HSBC will conduct an account review to check that you are on their best account tariff.
Some of the features and benefits of TSB’s free business bank account.
- 18 months free day-to-day business banking for new customers and business start-ups
- Start-ups will get support from a relationship manager
- Switchers will receive dedicated support to take the hassle out of switching
- Choice of tariff to suit your business
- Guaranteed smooth switch with the Current Account Switch Guarantee
- Internet banking offering 24/7 account management
- Access to Faster Payments
- Export statements into your finance package
- Free text alerts services
- Relationship Manager available over the phone
TSB offers 18 months free day-to-day business banking to both new customers and new business start-ups as long as the account stays within the agreed limits and does not go overdraw without prior arrangement.
TSB participates in the Current Account Switch Guarantee which means that you should receive a smooth transfer between current account providers within 7 working days. They also offer a choice of business tariffs so that you can select the best tariff for your business.
TSB state that they are a local bank with 550 branches across the UK and that the money invested with them stays locally as they do not deal in investment banking, overseas speculation or corporate finance.
7. Cooperative Bank
Some of the features and benefits of Cooperative Bank’s free business bank account.
- Free day-to-day business banking for 30 months for new customers
- No monthly service charges for 30 months
- All automated credits and debits are free for 18 months
- Writing 30 cheques per month are free
- Manage your account online 24/7
- Telephone and postal banking
- Network of branches
- Access to your account through Post Office branches
- Overdraft facility and lending options
- Backed by the Current Account Switch Guarantee
Cooperative Bank offers a free day-to-day business banking period to all new customers who operate within the rules of the account. To be eligible you must maintain a credit balance of a minimum of £1,000. The offer also limits certain transactions to a maximum of depositing 100 cheques per month, depositing £2,000 cash per month, and writing 30 cheques per month.
At the end of the free banking period, you will be transferred to their standard Business Directplus tariff which charges £5 per month account maintenance fee.
Switching your account to Cooperative Bank is simple as they have signed up to the Current Account Switch Guarantee service which will guarantee that your account switches over within 7 working days.
8. Clydesdale Bank
Some of the features and benefits of Clydesdale Bank’s free business bank account.
- 25 months free day-to-day banking for new customers
- 25 months free day-to-day banking for new business start-ups
- Free automated transactions including direct debits
- Free cash deposits and withdraws up to £250,000 per year
- Internet banking services
- Mobile app
- Optional agreed overdraft
- Borrowing facility available up to £250,000
- Automatically switch to their business banking tariff at the end of the free period
- Member of the Current Account Switching Service and backed by their guarantee
Clydesdale Bank’s free day-to-day banking offer for 25 months means that you will not be charged an account fee or service charge which includes direct debits, automated transactions, cash deposits and withdrawals up to £250,000. It does, however, exclude international payments and CHAPS payments.
To be eligible for this 25 months free banking offer your business needs to have an annual turnover below £2 million. New business start-ups need to have been trading for less than 12 months
Clydesdale Bank has designed their business current account for small businesses who need basic account management to meet their everyday business banking needs. The account offers the full services of a current account with an optional agreed overdraft facility.
Some of the features and benefits of Tide’s free business bank account.
- No monthly or annual account fee
- Membership bank service
- Free card usage home or abroad
- Free money transfers to other Tide members
- Use Post Office branches for transactions (charges apply)
- Make deposits at PayPoint (charges apply)
- Mobile banking app
- Simple pricing with low transaction costs
- Simplified banking to minimise time spent banking
- Designed with small businesses in mind
Tide’s business bank account is different to other business bank accounts in the market as it does not charge a monthly or annual account charge or subscription, its bank account is free, but they charge for some transactions. They operate a simple pricing structure and keep their charges low as they do not have the branches and multiple levels of management to pay for.
Free transactions include card usage at home or abroad, and free transfers to other Tide members.
Tide charge for sending and receiving money from non-Tide accounts at 20p per transaction. Cash withdrawals at cash machines at £1 per withdrawal. Cash deposits at Post Offices are charged at £1 per transaction and at PayPoints at 3%.
10. Starling Bank
Starling Bank’s free business banking features:
- No monthly fee
- No interest is payable on positive balances
- 15% EAR on overdrafts
- No separate fee for overdrafts
- Free to send money via Faster Payments, Direct Debits and Standing Orders
- Deposit up to £1,000 in cash at the Post Office for just £3
- No charge for withdrawing £ Sterling from ATMs in the UK
- No charge for withdrawing cash in foreign currency outside the UK (currency exchange rates apply)
- £20 fee for certifying documents relating to your Account
- No fee for debit card payments
Starling Bank offers a huge range of features for a free, no fee business account. And unlike many other accounts listed here their account remains free so long as your business has fewer than 10 employees and less than £1.7m in annual turnover. Moreover, unlike some of the accounts listed below they are a fully regulated bank which means that all eligible deposits are protected by the FSCS up to £85,000.
Coconut’s free business banking features:
- Free UK current account
- Only offers two plans: start which is free and grow which is £5/month
- Free automated bookkeping
- Free receipt capture
- Instant notifications
- Ability to easily share and export banking data
- Free tax estimate
- Ability to invoice from the app (limit of 3 per month on free plan)
- Free replacement cards on grow plan (£4 per card on start plan)
- No currency exchange fee on grow plan (2% on start plan)
Coconut is geared to smaller businesses and freelancers who need an all-in-one banking package. They offer not only a free current account but also tax, accounting and bookkeeping features as well.
Just be aware that Coconut is not a bank and doesn’t have a banking licence, which means that money deposited with them isn’t reinvested or lent out. Deposits held with Coconut fall under the Electronic Money Regulations 2017. This means that any funds that are held with them are stored in a segregated, safe-guarded, ring-fenced account with Barclays Bank.
ANNA’s free business banking features:
- First 3 months free (Or 6 months via Know Your Money)
- Plans are just £11 after the free period is over
- No transaction fees
- No fees for cash withdrawals
- Same-day set up
- Can chase outstanding invoices
- 24/7 UK-based support
- Ability to freeze your ANNA Mastercard® in the app
- Personalised reports
- Smart invoicing
ANNA stands for Absolutely No Nonsense Admin. This means you can have your free account set-up quickly, sometimes in as little as 10 minutes (assuming you have all your documentation ready). However, be aware that ANNA is a business current account and digital admin assistant, not a bank.
13. Counting Up
Counting Up’s free business banking features:
- Plans vary in price based on amount of incoming funds
- Free plan remains free so long as your monthly income is below £750
- Most expensive plan is only £4.95/month (once monthly income above £1,750)
- Bank account number & sort code
- Automated bookkeeping
- Invoicing from the app
- Profit and Loss report
- Receipt capture
- £1 per ATM withdrawal (all plans)
- 20p per bank transfer in or out
Counting Up is geared towards smaller businesses who want not just a current account but also help with accounting and bookkeeping. You never pay a fee if you’re monthly incoming funds stays below £750/month. Counting Up is not a bank, however all customer funds are held securely in a segregated, ring-fenced Client Account at Barclays under the FCA’s Safeguarding Rules.
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