The Best Bank for Startups in 2022

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Best banks for startups looking to scale up

Even new startups need to distinguish between personal and business finances. A good bank will provide a startup all the basic business checking accounts with zero or minimum opening balances and minimal transaction fees, as well as features that correspond to the startup's initial goals - namely cash flow and management at lower interest rates, short-term credit plans and easily accessible features available through online banking facilities.

Best banks for startups ACH transactions

Automated Clearing House (ACH) is a financial network in the US through which payments are remitted for payrolls, vendor invoices, direct deposits, consumer bills for loans, mortgages, etc. The ideal bank for startups will charge a minimal amount for processing these transactions in a hassle-free way. Such ACH facilities should also come with transparent fees and quick processing time so the startup can focus on scaling, expanding, and accelerating. Ideal banks for ACH transactions will have a broader reach in terms of geographic location.

Criteria to use to evaluate banks for startups

1. Minimum account balance

The ideal bank won't require a minimum balance in your account at all times; however, some banks have low minimum account balance allowances. Each bank has its criteria for "minimum balance," especially if the startup holds multiple accounts. Examples include minimum daily balance, average minimum balance, and minimum combined balance (average total money in various accounts).

2. Integrations

The ideal bank integrates your startup's accounts with almost all service providers essential to accounting, such as payroll and CRMs, or necessary for establishing the startup's overall efficacy, such as cloud computing vendors, HR software, etc. Useful integrations go a long way in providing the added benefits of ease of use and minimal hassle.

3. Credit line

The credit line should be congruent with the venture capital investment in the startup. The ideal bank will have minimal interest rates and flexible repayment options for the borrowed amount along the line of credit.

4. Transaction fees

Ideally, most banks for startups should not have any transaction fees. These fees are levied after a set number of transactions or additional transactions. Look for hidden costs that may be added to your transactions, such as fees for ACH payments and domestic and international wires.

Best banks for startups in 2022

Mercury

Description: Online banking for startups through Evolve Bank and Trust. It provides FDIC-insured funds and added benefits for startups.

Best for: Startups, e-commerce solutions, and angel investors

Pricing: Free bank accounts.

Evaluation of key criteria:

Minimum account balance: No minimum deposit for the Standard plan
$250k minimum balance for Mercury Tea Room
Integrations: Available with accounting software and payment processors such as Shopify, Zapier, QuickBooks, Amazon, and Stripe
Credit line: Mercury Bank doesn't offer loans or credit cards yet
Transaction fees: There are no monthly or overdraft fees; free sending and receiving domestic/international wires. 1% charge is levied on currency exchange for both plans.

Pros:

There is a provision to put idle funds in US government securities to yield timely returns via Mercury Treasury.
Mercury bank's mobile app is compatible with Android and iOS and allows you to view balances and manage card settings anytime, anywhere.
Two-factor authentication is available to keep your funds secure

Cons:

Possibility of a delay in clearing deposits and in transferring funds internationally
No allowance for cash deposits

NorthOne

Description: Online banking that empowers startups through digital banking tools and excellent support, so they can focus on scaling up

Best for: Small businesses

Pricing: $10 per month

Evaluation of key criteria:

Minimum account balance: A minimum opening balance of $50 is required.
Integrations: PayPal, Shopify, Amazon, QuickBooks, Gusto, and Wave, to name a few
Credit line: Personal and business credit available. Business credit can be availed via a business bank account. It is rated in terms of lines of business credit applied for in 9 months, punctual payment history, credit utilization, etc.
Transaction fees: $15 levied for sending and receiving domestic wire transfers; no additional fees for ACH payments, purchases, or app integrations.

Pros:

There is no limit to the number of free transactions
No limit to the number of sub-accounts (Envelopes)
The NorthOne business banking app facilitates the sending of unlimited invoices.

Cons:

There is no option to waive monthly charges.
There is no provision for sending or receiving international wires.
ATM operator charges may be levied even if the transaction is within the network.

Chase

Description: The banking auxiliary of JP Morgan Chase provides banking services ranging from credit cards (very stringent rules) and mortgages for all kinds of startups.

Best for: New e-commerce startups and small and medium-sized businesses of all types.

Pricing: $15 monthly fees

Evaluation of key criteria:

Minimum account balance: $15 monthly service fee that can be waived if $2,000 minimum daily balance is achieved (Chase Business Complete Banking), $30 monthly service fee that can be waived with $35,000 combined average beginning day balance (Chase Performance Business Checking), and $95 monthly service fee that can be waived with $100,000 combined average beginning daily balance is achieved (Chase Platinum Business Checking). These three options are best for small, mid-sized, and bigger businesses, respectively.
Integrations: Seamless platform integration is available through developer-friendly APIs, including external payment processors and third-party vendors.
Credit line: Chase Business Line of Credit - ideal for short-term cash needs. Interest is levied on the amount you use, and there's a choice of monthly payment date according to your cash flow—Chase Commercial Line of Credit - ideal for larger capital needs. Interest rates vary based on credit history and banking relationship, and interest-only monthly payments are available.
Transaction fees: With Chase Performance Business Checking, there is no transaction charge for up to 250 transactions per month. The same is true for Chase Platinum Business Checking for up to 500 monthly transactions.

Pros:

Options are available to waive monthly service fees
Chase offers a broad base of credit cards; 6 are specifically designed for small businesses.
Chase Bank customers have access to 16,000 Chase Bank ATMs with no transaction charge. A mobile banking app is available.

Cons:

A minimum daily balance or average balance is required to avoid monthly fees.
Branches of Chase Bank are not widely available in some states.

KeyBank

Description: A KeyCorp subsidiary providing financial services for startups, with added support from bankers often referred to as "financial wellness consultants."

Best for: Small businesses, startups, retail, and investment clientele

Pricing: $25 monthly service fee

Evaluation of key criteria:

Minimum account balance: For KeyBank Business Checking Account, there's a minimum opening balance of $25. $5 monthly service fee that can be waived off with KeyBank Basic Business Checking, $15 waivable monthly service fee for KeyBank Business Interest Checking (for startups keen on earning monthly interest), and $25 waivable monthly fee for KeyBank Business Reward Checking.

Key Business Saver Account: No monthly maintenance fee with a minimum daily balance of $300

Key Business Silver Money Market Savings Account: There is no monthly maintenance fee with a daily balance of $5,000 or more in your account during the monthly statement cycle.

Key Business Gold Money Market Savings Account: No monthly maintenance fee with a minimum daily balance of $25,000

Integrations: QuickBooks Desktop, QuickBooks Online, Sage Intacct, Xero, Oracle, NetSuite.
Credit line: A loan amount between $10,000 and $500,000 is available with minimum monthly payments (varied interest rates), renewable every year.
Transaction fees: 200 combined monthly transactions (KeyBank Basic Business Checking), 100 combined monthly transactions (KeyBank Business Interest Checking), and 500 combined monthly transactions (KeyBank Business Reward Checking); all transactions processed through Treasury Services will be charged against an agreed-upon fee schedule.

Pros:

Excellent customer service, including Twitter assistance and chat support outside of working hours.
Low monthly fees compared to similar banks

Cons:

High overdraft fees
Certificates of deposit come with low-interest rates
KeyBank charges $2.50 in the US and $5 outside the US for ATM transactions at other banks.

US Bank

Description: Fifth largest bank in the US that provides easy money management tools and flexible operations

Best for: Startups of all sizes

Pricing: Three plans are available with varying monthly fees that are waivable:

US Bank Silver Business Checking: $0 monthly fee

US Bank Gold Business Checking: $20 monthly fee

US Bank Platinum Business Checking: $30 monthly fees

Evaluation of key criteria:

Minimum account balance: For a Standard Savings Account, a monthly maintenance fee of up to $4 can be waived with a $300 minimum daily balance or an average monthly collected balance of $1,000. A minimum opening deposit of $25 is required.
Integrations: Quicken, QuickBooks, Plaid
Credit line: Business equity line of credit up to $500,00 with monthly interest-only payments. Also offered is a business line of credit up to $1 million with a monthly interest-only payment option.
Transaction fees: Up to 500 free monthly transactions and 200 free monthly cash deposits, although a service fee is charged on wire transfers.

Pros:

Swift and easy account opening process
Easy-to-use website and app for money management from any place
Check deposit feature available with the mobile app

Cons:

High service fees
Lower interest earnings

Bank of America

Description: Multinational investment bank that synthesizes financial services ranging from savings and checking accounts to loans and credit, covering the entire range of retail bank products

Best for: Startups of all sizes

Pricing: $16 waivable monthly fee.

Evaluation of key criteria:

Minimum account balance: Opening deposit of $25 and minimum daily balance of $500 (Advantage Savings plan) required to waive maintenance charges
Integration: With Integromat, seamless integration with several services is automated, including CashPro API, NetSuite, Salesforce, among others.
Credit line: Line amount from $25,000 available at an interest rate of 3.75% (terms and conditions apply), no interest charges until funds are used. Annual revenue of at least $250,000 is a prerequisite. Unique benefits are available for veterans running small businesses.
Transaction fees: Monthly service fee of $8 (Advantage Savings plan), overdraft fee of $35, and varied wire transfer fees. ATM transactions out of the network amount to a $2.50 fee in the US.

Pros:

Comparatively high daily ATM limits and debit purchases
With 4700 branch offices in 35 states, it provides a nationwide network of banking and ATM services

Cons:

Deposit interest rates are meager.
Lack of premium checking options

Bridge Bank

Description: Customized savings and checking options for startups

Best for: Tech startups

Pricing: Not known.

Evaluation of key criteria:

Minimum account balance: Not known. Contact Bridge Bank for more details.
Integrations: Xero and several other solutions
Credit line: Flexible financing options customized for startups via partnerships with a wide range of investors and IPOs. Contact Bridge Bank for more details.
Transaction fees: $10 per wire for incoming wires and $15 per wire for outgoing ones, $45 per foreign wire

Pros:

Prompt customer support

Cons:

Apple Pay integration is not available.
Complex procedure for setting up an account

Revolut

Description: British financial technology company offering services ranging from interest-bearing "vaults," debit cards, stock trading, and cryptocurrencies.

Best for: US-based startups desiring global expansion

Pricing: Four plans available:

Standard: Free

Plus: £2.99 per month

Premium: £6.99 per month

Metal: £12.99 per month

Evaluation of key criteria:

Minimum account balance: None
Integration: Xero, QuickBooks, Slack
Credit line: Flexible credit limits with the Revolut Credit card, up to 6,000 euros. No interest rates are levied until the credit is used.
Transaction fees: Payment in British pounds, Euros, and Swiss francs cost $4 for domestic transfers and $6 for any other currency

Pros:

Fast transactions and money exchanges with the Revolut app
Excellent customer service with feedback after every transaction
Virtual cards are available for employees.

Cons

Transfer time up to three days for loading the Revolut account via bank transfer may lead to additional costs
Delay in international transfers

Silicon Valley Bank

Description: High-tech commercial bank that helps startups with banking tools stands out as the biggest bank based on local deposits.

Best for: Early-stage founders and startups.

Pricing: $0 for the first three years, $50 per month after that

Evaluation of key criteria:

Minimum account balance: None
Integration: QuickBooks Online, QuickBooks Desktop, Xledger, Yodlee, Xero, and Expensify, among others
Credit line: SaaS credit lines available for growing SaaS businesses with at least 500k euros MRR, on the formula of (2x to 4x MRR). The credit line increases with MRR; however, this option is not suitable for businesses with a high churn rate.
Transaction fees: No monthly maintenance fee, free domestic and international wires in all currencies, several checking accounts available at no extra cost

Pros:

Ideal for early-stage tech companies
Excellent customer service
Efficient small business debit card service

Cons:

Automation of daily transactions is not available yet because SVB is not integrated with NetSuite yet.
Foreign exchange services need further development.

Brex Cash

Description: Cash management tool that provides investment options for uninvested funds

Best for: Startups and small businesses

Pricing: Free

Evaluation of key criteria:

Minimum account balance: No minimum opening balance is required
Integration: QuickBooks, Xero, Sage Intacct, Oracle, NetSuite, and Gusto, among others
Credit line: A cash balance of $25,000 qualifies you to maintain a credit limit. Contact Brex Cash for more details.
Transaction fees: None

Pros;

No limit to free transactions
Option of investing your funds in a money market fund
E-commerce sales qualify for instant payouts.

Cons:

Not for sole proprietorships
Lower money market yields

Best bank for tech startups

Mercury Bank is tailor-made for startups because of easy-to-use financial tools that suit tech-based startups well. When working with limited resources, startups can benefit significantly from Mercury's free online banking and its viable charges for wire transfers. Mercury also provides free transfer of funds and is entirely online. Mercury's only prerequisite is that your startup must be located in the US. This one-of-a-kind bank's services grow along with your startup so that you can add users are you scale. Funds are FDIC-insured with Mercury, and this feature allows startups to recover an amount up to $250,000. With banking options limited to startups, Mercury Bank stands out because of its flexible tools and dynamic perks for startups as they scale.

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