Are you looking for a free business checking account? Almost all banks offer some form of a business checking account with no monthly fees. However, there are caveats. Most banks require a minimum average deposit level in order to avoid monthly account fees. In addition, there are typically fees charged if you go over a certain number of monthly transactions or dollar amount of monthly cash transactions.
In this article, we compared free business checking accounts from three leading banks–Bank of America, Wells Fargo, and Citibank–and provide our top recommendation for small business owners.
Best Small Business Checking Account: Bank of America
We recommend Bank of America and use it ourselves. Bank of America offers free business checking if you maintain a monthly average balance of $5,000 or a daily balance of $3,000, which is less than its competitors. The bank also has a large network of physical branches and a great online and mobile banking experience.
|Number of Branches|
|Average Balance Required For Free Business Checking|
|Monthly Fee If Monthly Balance Not Met|
|Varies By State.|
|$14||Varies By State.|
|Free Monthly Transactions|
|200 (45 cents / transaction after that)||200 (50 cents / transaction after that)||250|
|Fees On Physical Cash Deposits|
|Up to $10K: Free|
$10 -$25K: 0.2%
Above $25K: 0.3%
|Up to $7.5K: Free|
Above $7.5K: 0.3%
|Up to $10K: Free|
Above $10K: 0.3%
|Online Chat For Questions||Yes||No||No|
|Debit Cards Designed For Employees|
Bank of America: Best Small Business Checking Account for Small Businesses
Fit Small Business is a Bank of America business checking client. We have been using Bank of America for over 3 years. There are three main reasons we use Bank of America ourselves and recommend them as the best small business checking account:
- Low balance to waive fees – Virtually all business checking accounts have a monthly fee that the bank will waive if you maintain a minimum average balance each month. Bank of America’s Business Fundamentals checking account waives monthly fees for those that maintain an average balance of $5,000. This is significantly lower than the $7,500 average balance required by Wells Fargo. In addition, Bank of America also offers something that its competitors do not–they will waive the monthly fee if your daily balance never goes below $3,000.
- Low cash deposit and transaction fees – Retailers often have to pay large fees for physical cash deposits. In this area Bank of America shines. The first $10,000 of cash deposits each month is free, which is tied for the highest of the three banks reviewed. Above $10,000, Bank of America has the lowest fees of the three. Bank of America offers 200 monthly transactions for free, and after that, charges less per transaction than Wells Fargo.
- Good online banking experience – Of the banks reviewed, Bank of America is the only one where Live Chat was easily accessible on their website. Their mobile app is also well designed.
When you combine the above three factors with Bank of America’s excellent customer service and thousands of branch locations nationwide, it’s clear that they are the best option for small businesses.
Other Options: Wells Fargo and Citibank
Wells Fargo and Citibank also offer good free business checking accounts that may be right for your business. One reason some small business owners may prefer Wells Fargo is that it has more physical branches than Bank of America. Unfortunately, Wells Fargo has a higher minimum balance requirement–$7,500 versus Bank of America’s $5,000.
Citibank allows up to 250 free transactions per month, which makes it a good choice for some retailers and other transaction-heavy businesses. However, Citibank has far fewer branches in the U.S. and their online banking experience is not as good as Bank of America’s.
Also keep in mind that in this review, we compared three specific checking account options from three different banks. Each bank offers multiple business checking options for small businesses. Bank of America has Business Fundamentals, Business Advantage, and Business Interest Checking. Wells Fargo has Business Choice Checking, Platinum Business Checking, and Analyzed Business Checking. Citibank has CitiBusiness Streamlined Checking, and Citibusiness Flexible Checking. It may be that one of the checking account types not covered in this article may be the best for your specific business needs.
In-Depth Review: Bank of America vs. Wells Fargo vs. Citibank
Free Business Checking – How to Avoid Monthly Fees
Even though banks call their products “free business checking,” the monthly service fee is waived only if you meet certain conditions. Most providers of business checking make it fairly easy to avoid paying monthly account fees. If a small business doesn’t meet the conditions for free monthly checking, they are likely to pay $12 – $19 per month in fees ($144 – $228 in annual fees).
Many banks provide several ways to qualify for no monthly account fees. They typically include maintaining a certain average balance over the month, or never going below a certain minimum daily balance. Also, a business may be able to have the monthly fees waived if the business uses the bank’s merchant account services or credit cards, actively uses the account’s debit card, or has other funds with the bank.
Ways To Get Free Business Checking at Leading Banks
|Bank of America||Wells Fargo||Citibank|
|Average Monthly Balance||$5,000||$7,500||$5,000|
|Minimum Daily Balance||$3,000||Not applicable||Not applicable|
|Usage of Business Debit/Credit Cards||$250 In Net New Monthly Purchases||10 Monthly Debit Purchases||Not applicable|
|Combined Assets at Bank||$15,000 In Linked Accounts||$10,000 In Combined Business Balances||Not applicable|
|Services||Not applicable||Payroll and Merchant Account Services or enroll in Direct Deposit||Not applicable|
Transaction Fees & Cash Deposit Fees
There is “free checking” and “totally free checking.” If your company is doing over 200 transactions per month or depositing over $10,000 per month in physical cash currency, chances are there will be some fees associated with the usage of your account.
Citibank’s Business Checking Plus account allows for 250 free transactions per month, which is 50 more than Wells Fargo or Bank of America checking accounts described in this article. Transactions typically refer to electronic or paper based deposits (per item) into the account, and payments made through the account. However, debit card transactions are typically not counted. Bank of America and Wells Fargo offer 200 free transactions per month.
If a business is doing a substantial amount in cash currency transactions, there will also likely be fees. With Bank of America, a company depositing $25,000 per month in cash currency will pay $30 in monthly fees. For Wells Fargo, it would be $52.50.
Transaction and Cash Deposit Fees at Leading Banks
|Bank of America||Wells Fargo||Citibank|
|Number of Free Transactions Per Month||200||200||250|
|Cost Per Additional Transaction||$0.45||$0.50||Not Available From Website|
|Free Physical Cash Deposits||$10,000 per month||$7,500 per month||$10,000 per month|
|Cost For Additional Physical Cash Deposits||$10 - $25K: $0.20 per $100|
Above $25K: $0.30 per $100
|Above $7.5K: $0.30 per $100||Above $10K: $0.30 per $100|
Bank of America offers 200 free transactions per month. Additional transactions are $0.45 each. The bank also has the most generous policy for cash currency deposits of the three banks reviewed.
Wells Fargo offers 200 free transactions per month. Additional transactions are $0.45. The bank has the most expensive fees for physical currency deposits of the three banks reviewed.Bank of America offers 200 free transactions per month. Additional transactions are $0.45 each. The bank also has the most generous policy for cash currency deposits of the three banks reviewed.
Citibank offers 250 free transactions per month. Unfortunately, it was hard to find the fees that Citibank charges on additional transactions. The bank charges $0.30 per $100 for cash currency deposits that exceed $10,000 per month.
Mobile Business Checking App
All three banks have mobile apps that allow companies to check balances, deposit checks, and make payments using their mobile phones (android and iOS). Fit Small Business heavily uses Bank of America’s mobile app. However, we don’t have experience working with the mobile apps from Wells Fargo or Citibank. To compare the mobile apps, we relied on Magnify Money’s 2015’s Best & Worst Mobile Banking Apps.
Bank of America’s iOS app has a rating of 3.3 out of 5, and their Android app has a rating of 4.2 out of 5. Of the 10 largest banks in the US, these scores are in the middle of the pack. In our own experience, Bank of America’s mobile app is easy to use with a great deal of functionality. You can deposit checks, pay bills, and transfer money through the app. The app also uses fingerprint recognition technology, so you don’t have to remember your password each time you log in.
Additional Features: Quickbooks Integration and Employee Debit Cards
Quickbooks integrates with all the banks mentioned in this article. This is beneficial because you can then have your banking transactions and balances automatically imported into Quickbooks. This saves time on bookkeeping and taxes. Basic integration is free and can be accomplished in a couple minutes. However, some companies want to be able to make payments and conduct banking through their Quickbooks accounting software. Unfortunately, this functionality called “Direct Connect” is only available for desktop versions of Quickbooks, and tends to carry an additional fee of around $15 per month.
While all banks offer debit cards for accounts, some banks offer multiple types of debit cards. This is an area where Bank of America excels. They offer regular debit cards, as well as debit cards designed for employees which have tight daily transaction amount and cash withdrawal limits.
Bank of America offers integration with QuickBooks, both Webconnect and Direct connect. Also, the Bank of America Business Fundamentals account offers two types of debit cards, which limits the risk of providing employees a debit card.
Wells Fargo offers integration with QuickBooks, both Webconnect and Direct connect.
Citibank offers integration with QuickBooks, both Webconnect and Direct connect.
Locations & Convenience
The following table shows the top banks by their number of US branches (source: USBankLocations.com and bank websites).
- Wells Fargo has over 10% more branches than its nearest competitor, Chase.
- Bank of America is number three overall in terms of locations.
- Citibank is not in the top 10, though they do have a high concentration of branches in New York and California, so if your business is located in one of these states, this may be a convenient bank for you.
When choosing a bank for business checking, a business owner should be aware of how convenient their branches are to reach, as well as their distribution in the area (in case the business or owner moves locations).
|Rank||Number of Branches||Bank Name|
|1||6,257||Wells Fargo Bank|
|2||5,540||JPMorgan Chase Bank|
|3||4,833||Bank of America|
|6||2,284||Branch Banking and Trust Company|
|10||1,279||Fifth Third Bank|
|12||965||Huntington National Bank|
|13||865||Manufacturers and Traders Trust Company|
Fit Small Business uses Bank of America business checking, and we think it’s the best small business checking account. They require a relatively low average minimum balance to waive fees, low cash deposit fees, and a good online banking experience.