Remote Operations

Business Checking 101: Essential Insights for Modern Companies

September 22, 2023
Minh Mai

Business checking accounts serve as the primary financial hub for your operations, helping you manage cash flow, facilitate payments, and track expenses. They can also provide additional benefits, such as access to a line of credit and competitive interest rates.

However, picking the right checking account can be tricky. You must consider the monthly maintenance fees, minimum balances, and interest rates. To simplify the process, we’ve put together this guide to explain some of the different business checking options available. 

How does a business checking account work?

A business checking account helps you manage things like payroll, taxes, and vendor payments more efficiently by providing a dedicated account for all of your business transactions. 

A business account generally works the same way as a personal checking account, though they often come with additional fees, average daily balance requirements, and terms of use. Business checking solutions typically offer check-writing capabilities, online banking, business debit cards, Automated Clearing House (ACH) transfers, and wire transfers.

Typical components of a business checking account include:

  • Check-writing: Write checks to pay vendors, suppliers, or employees.
  • Debit card payments: Complete purchases with a business debit card and track expenses.
  • ACH transfers: Make ACH transfers electronically to pay bills or disburse funds to employees. 
  • Wire transfers: Send and receive funds quickly and securely, within minutes, domestically and internationally.

Key benefits of a business checking account 

Business banking offers more than just a secure way to manage cash flow and facilitate payments. It also provides:

Tax simplification

Filing business taxes can be complex and time-consuming. And if you use your personal accounts to pay for business expenses, sorting through hundreds or thousands of business transactions can be a nightmare.

A business checking account simplifies the tax filing process by separating your personal and business finances, making tracking and reporting income and expenses easier. Come tax time, you’ll have access to detailed reports and a clear record of all your business finances in one place.

Professionalism and credibility

A dedicated business account helps you build credibility and trust with customers, vendors, and partners. It projects an air of professionalism, demonstrating that your business is legitimate and serious about its operations. 

This can help you attract and secure better deals with potential clients, open up business credit cards or lines of credit with financial institutions, and form strategic partnerships.

Liability protection

Risks are an unavoidable part of running a business. You never know what could happen, and the last thing you want is to lose your hard-earned money due to theft, fraud, or negligence.

A business checking account establishes a legal distinction between you and your business, protecting your personal assets from potential legal and financial liabilities. This allows you to keep your finances secure and, should the worst happen, reduces the likelihood of you bearing any personal financial responsibility for your business.

Preparing you for future growth

Growing your business means scaling up operations, which, in turn, requires more funds. Banks and financial institutions are more likely to grant lines of credit and business loans when you have a business checking account in good standing.

The account proves that you have a steady stream of income, a consistent cash flow, and can manage your finances responsibly, increasing your chances of getting approved for a loan. And business credit can help you meet your growth-oriented business needs, such as hiring new employees, purchasing inventory, and investing in marketing campaigns.

Key cash and check deposit challenges for small businesses

Small businesses often face challenges when it comes to depositing cash and checks. These transactions can be time-consuming and costly, especially if you’re dealing with a large number of monthly deposits. Common cash and check deposit issues include:

Processing fees

Most banks charge a fee for processing cash and check deposits. These fees can take a bite out of your profits, especially if you’re depositing large amounts of cash or checks. For small businesses with limited budgets, your cash flow can take a serious hit, cutting into your ability to buy inventory and cover operational expenses.

Security issues

Storing large amounts of cash or checks presents a significant security risk. There is always the possibility of theft, fraud, or human error, which can put your business in serious financial jeopardy. 

Cash deposits, for instance, require manual reconciliation, increasing the chances of incorrect data entry and accounting errors. Identity theft, counterfeit checks, and forgery are also common risks.

Large currency transaction reports (CTRs)

The U.S. government requires financial institutions to file a Currency Transaction Report (CTR) when customers deposit, withdraw, or exchange over $10,000 in one day. It’s a move designed to combat money laundering and other financial crimes.

The CTR must include information about the customer and the transaction, including customer name, account number, Social Security or Tax ID number, and type of currency used. All this data must be verified, recorded, and submitted to the IRS within 15 days of the transaction. 

Failure to file or incorrect filing of a CTR can result in hefty fines and penalties, subject your business to additional scrutiny and audits, and even lead to criminal charges.

The best business checking solutions / tools

Business checking solutions come in many shapes and forms, from traditional brick-and-mortar financial institutions to online banks with modern digital features. The right one for you depends on your business size, cash flow needs, and industry. Here are some of the most popular small business checking solutions tools or accounts to streamline your workflows:

1. Stable

Stable is a virtual business address and mailbox services provider offering a secure check deposits process. Your business can benefit from a dedicated professional address, comprehensive mail management solutions, and digital mail tracking and notifications. 

When you receive a check at your Stable address, you can deposit it directly into your bank account using mail-in deposits. It’s a secure, cost-effective solution that has helped businesses deposit tens of millions of dollars in checks efficiently. 

For a seamless check deposit experience, Stable will collect some information from you, including your bank account number. Each one-time check deposit costs $20, or you can sign up for the monthly check deposit add-on that lets you deposit up to 10 checks for just $50 per month. 

If you need more than 10 check deposits a month, you can build a custom package that suits your needs. And if you prefer depositing your own checks, Stable will forward your checks to you — wherever you are.

2. Stripe

Stripe is not primarily a business checking tool but a global online payment processing platform. It enables businesses to accept payments online and provides a suite of financial tools to manage revenue and transactions. While Stripe isn't a traditional business checking account, it functions as a vital financial tool for companies.

Stripe allows businesses to receive payments from customers and clients, process credit card transactions, manage subscriptions, and handle recurring billing seamlessly. It offers features like real-time reporting, financial data analytics, and automated revenue recognition. Users can set up payouts to transfer funds to their traditional bank accounts.

Stripe's financial tools can help businesses streamline their cash flow, track revenue, and manage payments effectively, making it an essential part of a modern business's financial infrastructure. However, it should not be considered a substitute for a dedicated business checking account, as it serves a different but complementary purpose within a company's financial ecosystem.

3. Bank of America

Bank of America is one of the U.S.’s largest and most recognizable banks. It’s a member FDIC institution that offers a range of financial services for small businesses, including checking accounts with low opening deposit requirements and affordable $0-29.95/month maintenance fees. 

You get free cash deposits of up to $20,000 per statement cycle, and the overdraft protection feature automatically declines purchases when your balance falls below zero, minimizing overdraft fees. 

Customers also enjoy free electronic transactions, including ACH transfers, debit card payments, remote deposits, and online or ATM deposits. BoA’s online banking tools include Bill Pay, Zelle, Cash Flow Monitor, and QuickBooks integration, helping you manage your finances more efficiently and conveniently. 

Bank of America’s online banking platform and mobile app provide 24/7 account access and secure authentication, making it easy to check your balances, deposit checks, transfer funds, and view statements.

4. Chase Bank

Chase Bank’s generous cash bonuses, large network of over 4,700 branches and 15,000 ATMs, and fast card and check processing features make it an attractive choice for small business owners. 

When you enroll as a Chase Business checking customer, you can earn $300 after completing the qualifying activities within 60 days. You also get free online banking, mobile banking access, and 24/7 customer service. 

The bank offers three business checking options: Chase Business Complete Checking, Performance Business Checking, and Platinum Business Checking. Each account comes with different fees and benefits, but all of them offer access to Chase’s extensive network of free ATMs, online payments, ACH transfers, mobile deposits, and credit/debit card processing. 

You can also take advantage of QuickAccept and QuickDeposit, two of Chase’s digital solutions that let you accept card payments through the Chase mobile app and deposit checks from almost anywhere.

5. Comerica

The last business banking solution on the list is Comerica, an FDIC-insured financial institution with a strong focus on small business banking. Its non-interest-bearing deposit account has no minimum balance requirement or monthly service fees. 

You also get powerful cash management solutions to protect your business deposits against fraud and loss. This includes dual control approvals, fraud detection algorithms, Mastercard Zero Liability protection, and real-time transaction alerts. 

Enjoy free online and mobile banking tools, a secure debit card that allows you to download transactions directly to Quicken or QuickBooks, and mobile checkout through Apple Pay, Google Pay, and Samsung Pay. 

Comerica also offers interest checking accounts with competitive yields, overdraft protection, and withdrawals from over 600 ATM locations. Customers can access various merchant services, including credit and debit card processing, point-of-sale solutions, and e-commerce integrations.

Use Stable to save time and resources when depositing checks

Choosing the right checking solution for your business is critical for success, sustainability, and growth. But you can easily manage bill payments, deposits, and cash flow with the right service that fits your unique business needs. 

To find the best business checking solution for you, start by assessing your monthly transactions, cash and check deposits, and preferred tools and services. Weigh your findings against each bank’s offerings, looking at the availability of ATMs and branches, account balance requirements, maintenance fees, and other factors. 

For maximum convenience and streamlined check flow management, use Stable. Stable lets you securely and remotely deposit checks — no bank visit required. 

Sign up for Stable today and simplify your business account management so you have more time for what matters: growing your business.

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