Best Online-Only Business Bank Accounts May 2024

Compare different online business bank account options

This article aims to guide you through the top online-only business bank accounts available in the UK, focusing on those that offer exceptional digital-first banking experiences.

Tailored for businesses looking to operate primarily in a digital space, these accounts promise convenience, flexibility, and innovation. We will explore the key features that set these accounts apart, including user-friendly apps, advanced security measures, competitive fees, and responsive customer support, to help you choose an account that aligns perfectly with your digital-first approach to business finance management.

The Best Online-Only Business Bank Accounts

Tide Business Account – Free

Tide has made a name for itself with a very streamlined, and efficient business bank account that now serves over 10% of the UK SME market. If you’re looking for a simple, well-priced and convenient digital-first account with quick set-up, Tide has much to offer. They’re currently offering a £50 cash-back if you sign up through Business Expert, which makes it even more appealing.

With Tide, you’ll also get access to a host of other useful functionality, which includes accounting software, in-app invoicing, quick approval for business loans, expense cards and the ability to integrate with Tide’s portable card reader. They don’t offer overdrafts which may be a downside for some.

ANNA Money

ANNA (Absolutely No-Nonsense Admin) is another bank account designed to simplify financial management for busy entrepreneurs. While it doesn’t provide an overdraft, ANNA compensates with features like invoice management and instant payment notifications, making it easier to stay on top of your business finances.

Anna has put a lot of thought into creating a business account designed to make the lives of business people easier. Every account comes with functionality like payment links, cash deposits at any Paypoint, plus the ability to use Anna money with Apple Pay. With Anna, you can give your coworkers their own debit card, while easily setting spending limits so that they can manage their expenses. You also have the ability to earn 1% cash back over a range of business expenses meaning the account could pay for itself.

Revolut

Revolut sees itself as a financial super app. With its suite of quick-to-open bank accounts, Revolut Business offers the ability to transfer money and access your funds in 25 plus currencies, plus easy ways to accept payments worldwide via Revolut payment processing.

Get physical and virtual company debit cards, control spending and permissions from one place, plus easily integrate with accounting software like Xero and Quickbooks.

Revolut also offers a host of integrations to further the capabilities of the account. Their business API allows technically savvy account owners to integrate their own tools and automate payments.

Monzo Lite Business Account

Monzo Business is another pioneer in the digital-first bank account sector. If you are a sole trader or limited company in the UK, you can apply for this fully regulated bank account straight from your phone. They offer 24/7 customer support, instant payment notifications, savings pots, and a host of useful integrations.

Choose from the Monzo Lite account, which is free or the well-priced pro account, which only costs £5 per month. This is a more affordable premium account than either competitor’s Tide or Starling.

One noticeable downside to Monzo is the £300 limit on cash deposits at any one time, and a £1000 cap every 6 months.

They are one of the few business current accounts in the challenger sector that is signed up to the easy switching service making migration to Monzo very easy.

Another downside to note is that you can’t currently receive international payments, and if you choose the free account, there are no accounting integrations available.

Starling Bank Business Account

Starling Business has quickly become a favourite among UK business owners, thanks to its straightforward, efficient banking solutions. Like Monzo and Tide , Starling offers a fee-free business account, ensuring your costs are kept to a minimum. The account supports seamless cash deposits and comes with an overdraft facility, which is a rarity amongst challenges.

Starling’s award-winning app provides an intuitive banking experience, complete with tools for budgeting and saving, making financial management simpler and more accessible. The bank’s commitment to transparency and customer service excellence makes it a standout choice for businesses looking for a reliable and user-friendly online banking partner.

Mettle Business Bank Account

Mettle by NatWest presents an enticing option for sole traders and limited companies aiming for simplicity and efficiency in their banking. This account charges no monthly fees and offers a digital-first banking experience, focusing on agility and ease of use.

The inclusion of FreeAgent accounting software as part of its offering is a notable advantage, simplifying bookkeeping and tax submissions for businesses. With Mettle, cash deposits are possible, enhancing its flexibility for businesses that handle physical cash.

Allica Bank Business Rewards Account

Allica Bank differentiates itself by focusing on businesses with a certain scale, offering a free business rewards account that caters to those with higher turnover or employee counts. It stands out with its cashback offers and the absence of fees for many transactions, making it a valuable option for businesses looking to maximise their banking benefits. While it does not support cash deposits, it offers an overdraft facility and a unique proposition in the form of relationship managers for tailored support and advice. Allica Bank’s approach is suited to businesses looking for a blend of traditional banking support with the benefits of modern financial technology.

Cashplus Bank Business Go Account

Cashplus Bank offers a Business Go Account that is ideal for entrepreneurs and SMEs seeking a straightforward and hassle-free banking solution. With no monthly fee and a straightforward approach to transactions, including three free bank transfers per month, it appeals to businesses keeping a close eye on their expenses. Cash deposits are also supported, adding a layer of convenience for businesses dealing in physical currency.

Cashplus focuses on making business banking as simple as possible, boasting a quick and easy account opening process. This makes it an attractive choice for businesses eager to get started without delays or complicated paperwork, all while ensuring they have access to essential banking services.

Benefits of Choosing an Online-Only Bank for Your Business

Opting for an online-only bank offers significant advantages for businesses prioritizing ease, speed, and app-based management:

• Simplified Banking Experience: With user-friendly apps, businesses can effortlessly navigate their accounts, conduct transactions, and monitor financial activities, all designed to minimize the time spent on banking operations.
• Instant Access and Control: The ability to manage your account from anywhere at any time ensures that you can make swift financial decisions, transfer funds on the go, and keep an eye on your cash flow without the need for physical bank visits.
• Fast Transactions: Online-only banks are known for their rapid processing of payments and transfers, facilitating quicker cash flow management and operational efficiency.
• Quick Account Setup: The digital account opening process is straightforward, requiring just a few minutes to complete without the need for in-person meetings or paperwork, allowing you to start managing your finances sooner.
• Innovative Features: These banks often introduce cutting-edge features for financial management, such as accounting software integration and spending analytics, directly accessible from their apps.
• Cost Savings: With competitive fees and often no monthly account charges, online-only banks can offer a more cost-effective solution for business banking, thanks to their lower operational costs from not maintaining physical branches.

For business owners focused on managing their banking efficiently through an app, the transition to an online-only bank can significantly enhance operational agility and financial oversight.

Are There Downsides to Online-Only Bank Accounts?

While online-only bank accounts offer numerous benefits for businesses, there are some potential downsides to consider. These limitations may impact businesses depending on their specific banking needs and preferences:

• Limited Cheque Services: Some online-only banks do not support cheque deposits, which can be a drawback for businesses that still receive payments via cheque. This limitation requires finding alternative ways to process such payments, which might not always be convenient.
• No Overdrafts: Not all online-only banks offer overdraft facilities. For businesses that rely on overdrafts for cash flow management, this absence can be a significant constraint, limiting financial flexibility.
• Lack of Physical Branches: The absence of branch access means that all banking must be done digitally. While this is a benefit in terms of convenience and efficiency, it can be a disadvantage for businesses that prefer in-person banking services or need to deposit cash frequently.
• Personalised Bank Manager: Online-only banks typically do not provide a personalised bank manager. Traditional banks often assign a dedicated manager who can offer tailored advice and support based on an understanding of your business. The lack of this personal touch can be felt by businesses that value and rely on such insights for financial decision-making.
• Customer Service Concerns: While many online-only banks offer robust customer support through digital channels, the experience can sometimes lack the immediacy and personalisation of speaking directly with bank staff. This can be particularly challenging during complex issues that require detailed resolution.
• Perception of Security: Despite online-only banks adhering to strict security protocols, some businesses may have concerns about the security of online banking. The digital nature of these banks can lead to perceptions of increased vulnerability to cyber threats, although this is often mitigated by advanced security measures.
• Limited Product Range: Online-only banks may offer a narrower range of financial products and services compared to traditional banks. This can be a limitation for businesses looking for a one-stop-shop for all their financial needs, including loans, mortgages, and more specialised banking services.

While online-only banks are an excellent option for many businesses, it’s important to weigh these potential downsides against the benefits. For some businesses, a hybrid approach, utilising both online-only and traditional banking services, may be the best solution to cover all financial needs and preferences.

How to Choose the Best Online Business Bank Account

Selecting the best online business bank account requires careful consideration of your business’s unique needs and banking preferences. To ensure you make an informed decision, it’s important to ask yourself a set of critical questions that address the core aspects of your banking requirements. Here’s a useful list of questions to guide your selection process:

1. Do I Need FSCS Protection?: Determine if the Financial Services Compensation Scheme (FSCS) protection is crucial for your business. This protection covers your deposits up to a certain limit, offering peace of mind in the event of a bank failure.
2. How Important Is the Ability to Pay in Cash?: If your business frequently deals in cash transactions, consider whether the bank offers convenient options for depositing cash.
3. Will My Business Need Overdrafts During Its Startup Phase?: Evaluate the necessity of having an overdraft facility to manage cash flow, especially in the early stages of your business.
4. What Are the Fees Associated With the Account?: Understand the fee structure, including monthly fees, transaction fees, and any other charges, to ensure the account aligns with your budget.
5. How Comprehensive Are the Banking Features and Services?: Assess the range of features and services offered, such as invoicing capabilities, integration with accounting software, and financial management tools.
6. Is International Banking Important for My Business?: If you conduct business internationally, consider whether the bank supports multiple currencies and offers competitive rates for foreign transactions.
7. How Responsive and Accessible Is Customer Support?: Consider the quality of customer support, including availability hours, response times, and support channels (e.g., phone, email, chat).
8. What Security Measures Are in Place?: Ensure the bank employs robust security measures to protect your account and personal information from cyber threats.
9. Can the Account Scale With My Business?: Look for an account that can grow with your business, offering scalability in terms of banking services and transaction limits.
10. What Do Other Customers Say?: Research customer reviews and testimonials to gauge satisfaction levels and identify any recurring issues.

By thoughtfully considering these questions, you can narrow down your options and select an online business bank account that best suits your business’s financial needs and goals.