Grasshopper vs Lili Business Checking: Which Is Better for You?
This article is part of a larger series on Business Banking.
If you’re planning on opening a business bank account, Grasshopper’s Innovator Business Checking and Lili’s Basic are great options. Both accounts don’t charge monthly fees nor impose minimum balance and opening deposit requirements. Grasshopper is great for businesses that want to earn both interest and cash back, whereas Lili is a good choice for businesses looking to streamline tax preparation.
Here’s a summary of what each provider is best for:
- Grasshopper: Best for cash back on debit card purchases
- Lili*: Best for tax preparation assistance
*Lili is a financial technology (fintech) platform backed and Federal Deposit Insurance Corp. (FDIC)-insured through a supporting bank partnership with Choice Financial Group.
Grasshopper vs Lili Quick Comparison
When To Use Each
When To Use an Alternative
- You want to save on ATM withdrawals: Neither Grasshopper nor Lili offers any ATM fee reimbursements, and Lili charges a fee for out-of-network ATM withdrawals. Businesses that want a wider selection of ATM networks should choose Novo, which reimburses all ATM fees by the end of the month.
- You want competitive interest rates: Lili checking accounts don’t draw interest while Grasshopper’s highest interest rate is 1.00%. Those looking for competitive rates should consider Bluevine as its qualified accounts earn 2.0% APY on balances of $100,000 and under.
- You prefer in-person banking: Both Grasshopper and Lili don’t have physical bank branches. If this is important to you, then look into Chase, which has 4,700 brick-and-mortar branches across the country.
Grasshopper vs Lili Business Checking Account
Grasshopper offers the Innovator Business Checking for startups and the Small Business Checking for small businesses. Aside from the names, there’s little to no difference between the two accounts.
Meanwhile, Lili offers a fee-free account called Lili Basic and a premium account called Lili Pro, which costs $4.99 per month to maintain. Lili Pro offers exclusive features, such as cash back rewards, direct deposit, fee-free overdraft protection, advanced expense tracking, 1.00% APY savings, and invoicing software.
Grasshopper vs Lili Business Checking Account Overview
Grasshopper Innovator Business Checking | Lili Account | |
---|---|---|
Best For | Cash back on debit card purchases | Tax preparation assistance |
Opening Deposit | N/A | N/A |
Interest on Balances | 0.5% APY (balances up to $10,000) 1% APY (for balances over $10,000) | N/A |
Bank Network & ATMs | Free at MoneyPass and SUM ATM networks | Free at MoneyPass locations; $2.50 for nonnetwork |
Accounting Software Integrations | QuickBooks and AutoBooks | Built-In Expense Tracking, QuickBooks, FreshBooks |
Business Software Integrations | Plaid-supported apps | CashApp, PayPal, Venmo, Uber, Lyft, Shopify |
Reserve Accounts | None | Buckets for tax and emergencies |
Open an Account |
Grasshopper is on our list of the best small business checking accounts because it offers a generous cash back rewards program. Users earn 1% cash back on every purchase made with its business debit card, 0.5% APY on balances up to $10,000, and 1.00% APY on balances over $10,000. Meanwhile, Lili’s business checking account earns no interest. Its savings account, which earns interest at a rate of 1.00%, is only available to Lili Pro Users.
However, what sets Lili apart from its competitors is its Tax Optimizer. Available to all Lili users, it lets account holders select a percentage of their income to set aside for taxes automatically on a regular basis. This feature also uses banking and spending information to fill out Schedule C forms automatically and reduce the manual work involved in tax filing.
Both providers integrate with the accounting solution QuickBooks. On top of that, Grasshopper integrates with Autobooks while Lili integrates with FreshBooks and provides its own built-in expense tracking solution. Grasshopper accounts connect with all Plaid-supported apps, such as Venmo. Meanwhile, Lili integrates with payment solutions CashApp, Venmo, and PayPal as well as popular business platforms like Uber, Shopify, and Lyft.
Grasshopper doesn’t offer any reserve accounts. Lili users can create up to two subaccounts within their main account, namely a Tax Bucket for taxes and an Emergency Bucket for emergencies.
Grasshopper vs Lili Business Checking Account Costs
Grasshopper Innovator Business Checking | Lili Account | |
---|---|---|
Monthly Fee | None | None |
Criteria to Waive Monthly Fee | N/A | N/A |
Transaction Fee | N/A | N/A |
Cash Deposit Fee | N/A | $4.95 at Green Dot retail locations |
Both the Grasshopper Innovator Business Checking and Lili Basic don’t charge a monthly fee nor impose transaction limits. However, Lili Pro users will have to pay $4.99 per month to access its more exclusive features.
Lili users can deposit cash through any Green Dot retail location. However, Green Dot charges a fee of $4.95 per cash deposit.
Grasshopper vs Lili Business Checking Account Sample Scenario
Grasshopper Innovator Business Checking | Lili Account | |
---|---|---|
Out-of-network ATM fees | 5 transactions x $3.08* = $15.40 | 5 transactions x ($2.50 + $3.08*) = $27.90 |
Possible Total Fee | $15.40 | $27.90 |
*The average ATM surcharge from the ATM owner in 2021 was $3.08, per Bankrate’s 2021 checking account and ATM fee study.
Businesses regularly using out-of-network ATMs would save money by choosing Grasshopper over Lili. Where Lili users need to pay an additional $2.50 nonnetwork fee on top of operator fees, Grasshopper users only have to pay operator fees.
Bottom Line
Grasshopper and Lili are both great business checking options for those looking for affordable, digital-exclusive banking solutions. However, when comparing Grasshopper vs Lili’s business banking solutions, Grasshopper comes out as the more affordable option. Many of its features, such as cash back on debit card purchases, interest-earning potential, and invoicing software, are available for free.
Meanwhile, Lili users would need to upgrade to Lili Pro, which costs $4.99 per month, to access the same benefits. Grasshopper also offers access to lending products and fee-free incoming wire transfers, which are both unavailable with Lili. However, for businesses needing assistance with tax preparation, Lili is the better option.