Compare business savings accounts

A business savings account safely stores the funds you might need for equipment or taxes later and boosts your business’s overall credibility — critical for landing solid rates and terms on future loans when business booms. This guide shows you how to find the best savings or money market account for your business.

Compare business savings accounts

Use this table to compare business savings accounts by APY, fees and minimum opening deposits. Once you’ve narrowed down your list, click the “Compare” box next to your top picks to dive into even more details.

How do I compare the best business savings accounts?

To get the most out of a business savings account, compare similar factors across each of your options, including:

• Fees. If you’re a smaller business, you may be on the hook for monthly maintenance fees, though many banks waive these fees if you pick up other accounts or products.
• Features. Think about whether you’ll need regular access to your funds. Most business money market accounts come with ATM cards and check-writing privileges, while savings accounts give you less access to your money.
• Transaction limits. Savings and money market accounts are usually limited to six outgoing transactions a month. But many banks are temporarily waiving this limit due to COVID-19.
• Interest rates. Look at advertised interest rates both around the corner and online, further analyzing fees and limitations that can eat into your bottom line. By shopping around, you can find the best business account available today.
• Accessibility. Many online banks offer higher interest rates than you’ll find at your local bank. You won’t have the convenience of a neighborhood branch, but an extensive ATM network and linked account with your local bank could be worth it.
• Minimum deposit requirements. Money market accounts typically have higher opening deposits than savings accounts, but you may snag a higher APY and easier access to your money.
• Minimum balance requirements. How much you’ll need to keep in your account can range from a few bucks to tens of thousands of dollars, with higher rates applying to higher balances.

Do large bank transfers take longer?

No. Your bank’s system can support transfers of $2,000 to $200,000 without extra lag. Keep in mind that your bank may limit the amount you’re able to transfer in one transaction or to a specific recipient, though you can often make the case to increase your limit as your business grows.

Case study: How keeping surplus capital in a business savings account can help grow your business

Maddy works a full-time government job and has two children under the age of 12. As a single working mother, Maddy started an out-of-home baking business selling custom macaroons to friends and family. Now into the second year of her home business, her client base has grown and her services have expanded to include baking special occasion cakes. Maddy knows she will need to upgrade her oven to accommodate the growth of clients and order sizes. About six months into her business, she opened a Capital One Spark Business Savings account.

Because Spark Business Savings offers a competitive introductory interest rate of 1.75%, she hopes this will help her afford a bigger oven and other industrial-sized kitchen appliances she needs to accommodate her growing business. In addition, the account charges no monthly service fees and offers online and mobile banking services, which means she is able to manage her funds anytime, anywhere.

What are the benefits of a business savings account?

Business savings accounts and money market accounts are designed to separate your capital from everyday transactions, helping you to manage and grow your savings. Many banks offer introductory interest rates that can boost your savings for up to six months or more, and most accounts are protected by the FDIC for up to $250,000.

• Build your savings. Keep your money safe and earn passive income when it’s not needed for everyday business, helping you achieve both short- and long-term goals.
• Avoid fees. Move your money around with minimal transaction fees.
• Boost your business’s credit. A business savings account becomes a part of your overall financial portfolio, demonstrating that you’re able to successfully manage your savings and providing the support for future business loans.
• FDIC-insured. The government insures deposits for up to $250,000, so you can rest assured your money is safe.

What should I look out for?

Unlike investment accounts, there’s no risk of losing your balance with a high-interest business savings account or money market account unless your balance exceeds $250,000. Even then, banks put in place safeguards to protect your money.

To narrow down a business account that fits your business’s needs, weigh into your decision:

• Account fees. Many high-interest accounts waive fees for high balances, but ask about monthly maintenance, deposit or penalty fees for exceeding transactions or dipping below minimums.
• Transaction limits. All savings and money market accounts limit your withdrawals to six monthly, though you can transfer money to a linked checking account for broader access.
• Potentially high minimums. To take full advantage of business perks, you may need to maintain a balance of $10,000 or more in your savings or money market account.

Some of the top business savings accounts

The table lists a few business savings accounts with the highest APYs available today.

Product name	Maximum interest rate
Capital One Spark Business Savings	1.25%
Live Oak Bank Business Savings	1%
Axos Bank Business Savings	0.8%
Prime Alliance Business Savings	1% – 1.71%
First Internet Bank of Indiana	1% – 1.26%

How am I taxed on my business savings account?

The interest you earn on a business savings account is considered taxable income. If you earn more than $10 in interest on your account, you’ll receive IRS Form 1099-INT to file with your annual taxes.

What is a business savings account?

A business savings account is just like a personal savings account, allowing you to store your money and earn interest over time. When you’ve saved up enough working capital that you no longer need constant access to, you can safely grow it with reliable interest until a large purchase comes up.

To entice your business, many banks offer higher interest rates on larger deposits and balances in these accounts. The bigger your business’s savings, the more you earn.

Can I use my personal savings account for my business?

While this is technically possible, it’s not recommended. Keeping your personal and professional savings separate makes it easier to file your taxes and identify what deductions and credits you qualify for. Plus, it protects your personal assets from any potential lawsuits you may encounter as your business grows.

Bottom line

Your business may be ready to set aside some of its hard-earned cash into a savings account that offers high interest to keep it growing. Reliable rates mean steady passive income, and most accounts offer the protection of the FDIC for up to $250,000.

As always, compare your business banking options until you find an account that meets your company’s needs today and in the future.

Common questions about business savings accounts

• Are all business savings accounts high-yield?

  No, not all business savings accounts offer high yields. Different business savings accounts meet the needs of different businesses, but paying a high interest rate certainly makes a business account more competitive. Making sure the account you choose will help grow your capital and accommodate your specific needs is an important consideration.

• I have multiple employees who need to access my business savings. Is this possible with a high-interest business savings account?

  Yes. Look for a business account allows you to designate access for specific employees. Note that you’re responsible for the account and your employee’s actions, however.

• Do I need good credit to apply for a business savings account?

  Generally, yes — but how solid your credit needs to be depends on the bank. Ask how your bank considers your credit history when opening a business account.

• Can I use a high-interest business savings account for personal savings?

  No. Because they’re designed specifically for businesses, these accounts are subject to tax rates that aren’t relevant to your personal savings.

• Do I get instant access to funds with my business savings account?

  Generally, yes. Whether for personal or business use, savings accounts are very liquid and accessible, though watch out for limits on the number of times you can withdraw funds from your account in any given month.

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