Best banks for small businesses

Running a children’s activity business means wearing a lot of hats (not including a baseball cap if you are outside with your students or campers!). Especially if you are just starting out, you are likely responsible for everything from creating the curriculum and writing lesson plans to balancing your books and making important financial decisions.

At Sawyer, our goal is to help children’s activity businesses spend less time on administrative tasks and more time doing what they love: changing the lives of children. Choosing the right bank for your small business is one way to lighten your load when it comes to finances. In this guide, we outline the best banks for small businesses and provide helpful information so you know what to look for to make sure the bank is right for your business.

What to look for in a bank for a small business

As you begin to search for the right bank for your small business, there are a few elements to keep in mind. These are the top items to look for in a bank for a small business.

Size

The size of the bank can determine the types of services they offer, the support you receive, and the benefits or perks.

Large banks can be convenient since they have branches around the country, but it might be harder for small business owners who are just starting up to get an account or loan. However, if you can get into one, large banks can often offer favorable rates, better perks, and a large variety of credit and loan options.
Small, local banks can provide more attention and support to small businesses who are just starting out. They might be more attune to the local markets and community, which can help new businesses get the lay of the land. Plus, it might be easier to get a loan or credit with a small bank because they are more willing to take risks based on character and overall business profile.

Relationships

Whether you choose a small or large bank, one of the most important elements for success is the relationships you build. Building a strong relationship with your banker can help as you grow and scale your business. If you are a business owner who feels nervous making financial decisions, trusting your banker can help ease your mind and give you a sounding board. Plus, if you ever miss fees or payments, that strong relationship with your banker can come in handy.

Photo of best banks for small businesses

Requirements

Some banks have requirements that need to be met before a small business can work with them. Many look at credit score, current and projected revenue, loans and debt, available funds, and other factors. As we mentioned above, small and large banks often have different requirements. Depending on your business’ age and resources, you can determine which bank is right for you.

Quality

Banking is a matter of trust. Choosing a bank should be a well thought out and well researched part of starting and building your business. Be wary of banks that offer incredible deals, and out-of-this-world interest rates as well as banks that seem to have very lax requirements for their customers. Check reviews from other customers, the Better Business Bureau, and within your community to make sure the bank is safe.

Services

What services are important to you and your business? Here are some examples of services that banks can provide so you can start creating your ideal list.

Checking and savings accounts
Credit and debit cards
Checks
Online and mobile banking services
Employee accounts
Loans
Business support (growth, taxes, payroll, and more)

Now that you have some knowledge of what to look for in a bank for small businesses, you can start your research. In this section, we’ll outline some of the best banks for small businesses. However, it is important to remember that the best bank for one small business might not be the best bank for you. Location, business size, business age, and goals should all be part of your decision making process. Ultimately, the best bank for your small business is the one that fits all of your needs.

Here are some of the best banks for small businesses.

Chase. Chase is one of the most well known banks for both personal and professional services. Their business accounts do have a monthly fee of $15 and overdraft fees of $34, however, they accept free cash deposits and offer a $300 bonus for signing up. Credit card processing is integrated into their system, which can be very helpful for children’s activity businesses.
Bank of America. Bank of America offers three different types of business accounts. While they do charge a $16 monthly fee, $10 overdraft fees, and $100 minimum opening deposit, they accept free cash deposits, a $200 sign-on bonus, and electronic transactions without fees.
American Express. Business banking with American Express has no monthly fee, overdraft fees, and minimum opening deposit amount. They also offer 1.3% APY, $300 signing bonus, and business services like loans, 24/7 customer support, and credit cards. However, customers cannot deposit cash.
Capital One. Capital One business accounts include fee-free transactions, access to credit cards with rewards, free employee cards, and small business loans. However, there is a $15 monthly fee and $250 minimum opening deposit.
US Bank. US. Bank offers three business checking accounts (one is free!) as well as business savings, credit cards, services, and small business loans. They take free cash deposits, have no monthly fee, and offer a $500 sign-on bonus. There are $36 overdraft fees and a $100 minimum opening deposit.

Best online banks for small businesses

Many banks offer online and in-person services. Newer small businesses who are looking for support might benefit from speaking face-to-face with their banker. Likewise, in-person interactions help to build those strong relationships that are so important. However, if you are just looking for a business bank account or you are not interested in gaining support from your banker, an online bank might make more sense. They are often less expensive and can help you accomplish what you need more simply.

These are some of the best online banks for small businesses.

Axos Bank. Axos offers 24/7 customer support, which is especially beneficial for new businesses. There is no monthly fee and no minimum opening deposit. Axos offers a free online business checking account with unlimited ATM fee refunds in the U.S. and business services and loans.
Grasshopper. The Grasshopper business checking account has no monthly fee, no overdraft fees, and an APY (average percentage yield) of 2.25%. They also have business features like invoicing and bookkeeping tools built into their platform. However, they do not accept cash deposits, which can be difficult for young small businesses.
NBKC. Businesses that are looking to spend less on their bank might benefit from banking with NBKC. They have no monthly fee, no overdraft fees, no minimum deposit, and free cash deposits. However, they do not offer weekend or after hours customer support.
LendingClub. Small businesses might like working with LendingClub because they offer an interest-earning business checking account with unlimited ATM fee rebates and 1% cash back on debit card purchases. There is a monthly fee of $10 and a minimum opening deposit of $100, but no overdraft fees. LendingClub also offers money management services and small business loans.
Bluevine. Bluevine has no monthly fee, overdraft fees, or minimum opening deposit. They also offer a 2% APY and unlimited fee-free transactions. On the other hand, Bluevine has a fair number of restrictions on cash deposits and they do not allow joint accounts, which could be tough for businesses with multiple owners.

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Best banks for small business loans

When you are first starting your children’s activity business, raising the money that you need can be difficult. Depending on the type of activities and audience, you might consider applying for a small business grant or loan. Creating a business plan and budget as well as writing out your business goals are usually the first step. Then, you can start looking at your options.

Small business grants are a great place to start because you do not need to pay the money back. However, you often need to meet specific requirements to win a grant, and even if you do, it might not be enough capital. More often than not, small business owners will try for a combination of grants and loans to get their businesses running.

As you start thinking about small business loans, we recommend first looking at the website for the US Small Business Administration (SBA). They have a ton of resources that can help you find the right loan for your business, including a feature where you can search by zip code.

Another resource to find and receive small business loans is your bank. Most banks can help you get the information you need for your application, but some banks even offer small business loans as part of their business accounting program.

Here are some of the best banks for small business loans.

Bank of America. Bank of America is one of the best banks for small business loans because of their reward system. Business owners can qualify for interest rate discounts, no fees on wire transfers, and other benefits when they meet certain requirements. They are also a preferred Small Business Administration lender.
JPMorgan Chase. Chase is also an SBA-preferred lender. They fund multiple types of SBA loans, including SBA Express loans and credit lines, which offer faster funding of up to $500,000. This is beneficial for business owners looking to get their businesses off the ground more quickly.
Citibank. Not only do they have a great business credit card, but also Citibank offers a variety of small business loans. Interest rates for their loans are fixed, but loans do require a personal guarantee.
PNC. In order to qualify for most PNC loans, you must be in business for at least 3 years. That is longer than most other banks, but it also means that PNC can offer larger loans because they are more sure of the businesses. PNC is also a preferred SBA lender.
US Bank. US Bank offers fixed rate, secured term loans of up to $1 million. It also offers a fast business term loan, which has a lower borrowing maximum ($250,000) but a quicker application process.

We hope that this guide has provided inspiration for you to help you find the right bank for your small business so you can grow and scale. If you are looking for additional guidance on managing and running your business, the team at Sawyer is here to help. Use our resources for support as well.

With our suite of tools, like custom forms to record allergies and t-shirt sizes, flexible payment options like gift cards and installment plans, and seamless scheduling and registration on any device, Sawyer saves business owners 28 hours per month. If you are ready to spend less time on admin and more time doing more of what you love, see how Sawyer can help with a free trial or demo.