Scaling your business comes with its fair share of growing pains. As a result, you may find that you’ve outgrown your business checking account too. 

Choosing a new bank account — and then transferring all of your financial operations accordingly — requires careful thought and hand-holding on your part. However, the sooner you make the change, the sooner you can use your bank’s services to elevate your company to greater heights. 

But before you can initiate the transfer, you’ll want to find the best checking account for your business. Here are some tips to make both processes easier for you. 

What to look for in a business checking account

The best business bank account doesn’t just fulfill your company’s needs right now — it should also offer the right mix of benefits to support your organization in the years ahead. Here are five factors for your consideration:

  • Low fees: Service and maintenance fees vary widely between banks, from fees that can start at $100 a month to accounts that don’t charge you anything at all. Some banking institutions will also waive these fees if you meet certain conditions, like a minimum daily balance. 
  • Multiple services: Look for features like online banking, bill pay, a banking app and an extensive ATM network. You’ll also want to consider whether you need professional assistance managing your business’s finances. A study conducted by Intuit QuickBooks found that 69% of small business owners stress over cash flow. If you find yourself in this category, you may want to take advantage of banks that offer services such as payroll and tax preparation. 
  • Generous transaction limits: Some banks will place a monthly limit on transactions such as withdrawals, wire transfers and deposits. You may find that your bank restricts the amount of cash you can deposit every month or the number of monthly transactions, for example, by tacking on a fee after a certain amount. If you conduct a high volume of transactions or make many cash deposits, you’ll want to look for a bank that offers a high limit — or no limits at all.
  • Seamless software integrations: With more and more small business owners enlisting the help of software to run their company, you may find a checking account that integrates with your existing platforms extremely helpful. Financial services software, including those you use for accounting, invoicing and payroll, can all benefit from integration with your bank account.
  • Introductory offers and bonuses: Just as some credit card issuers offer promotions to bring in more customers, some banks also offer bonuses like gift cards and cash to business owners that sign up with them. Although these offers shouldn’t be the main reason why you choose one bank over another, it may very well be the deciding factor between two viable options. 

How to switch banks without interrupting your workflow

Open your new business checking account

First, you’ll want to apply for your checking account and supply any documents that the banking institution requires. This usually includes your Employer Identification Number (EIN), business formation documents, ownership agreement and your business license. 

Once you’re approved, you’ll be prompted to set up online banking for your account. You’ll also receive your business debit card and checks in the days following. 

Make sure that everything is working correctly before you make any changes to your old account. You don’t want to close your original account, only to realize that an issue on your new one prevents you from making or receiving new payments temporarily. 

Initiate the transfer process with a transfer kit

Some banks offer new account owners a comprehensive transfer kit containing a checklist and additional documents to help speed up your transition process. Ask your banker if they have one available and follow the steps outlined in it. If they don’t have one, you can use another bank’s switch kit as a general guideline or ask your bank if they have any resources to help you through the process. 

During the transfer, you may also want to keep some funds in your old account for any outstanding checks and payments you need to make in the next few days. This ensures that your financial obligations are still met and can help you avoid unnecessary stress during this time. 

Identify recurring payments 

Next, go through your past financial statements and look for any recurring payments that need to be transferred to your new account. These transactions include: 

  • Payroll for employees
  • Payments to vendors, suppliers, contractors and providers
  • Monthly subscriptions to software programs
  • Utility bills and insurance premiums
  • Company cell phone bills
  • Recurring invoices from clients

Notify parties about your switch to a new account

Once you’ve compiled a list of the people and organizations affected by your account transfer, send them a message to let them know about the changes that are taking place. 

Banks that offer transfer kits often include notification letters you can use to inform these groups. These templates notify the party about the change and give them your new account details so they can update their billing information accordingly. If you aren’t provided with a transfer kit, you can also draft up your own letter to send to each organization yourself. 

If you own a monthly subscription or work with a service provider that automatically bills you every month, make sure to change your billing information on these accounts as well.

You may also want to keep each party in the loop in case any issues come up during your transition period. 

Close your old bank account

Once everything is set up and your transactions go through on your new account without issues, you can now close your old bank account.

Transfer any remaining funds from your original account into your new one. Then contact your old bank, letting them know that you’re closing your account and moving over to a different institution. During this time, double check to make sure you haven’t missed anything during the transfer and cancellation process. 

Finally, shred any remaining blank checks and cut up your debit cards from your original business checking account. You’ve successfully completed your bank account transfer — and taken huge steps to securing your company’s financial future. 

Remember, you run your business. Don’t let it run you.

When deciding on a business checking account, choose one with the features and products you need to help manage your finances effectively and easily. 

About the Author(s)

 Ting  Pen

Ting Pen is a ValuePenguin Co-Founder. She previously evaluated corporate mergers and acquisitions as a Financial Analyst at Citigroup. Her experience in financial services combined with her entrepreneurial spirit allowed for her to start her own fin-tech company. Her passions lie in problem solving, growth, and travel.

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