Business bank accounts with overdrafts UK 2026

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From a piece of equipment breaking to the cancellation of a major order, business owners often have to deal with unexpected costs that can push their business account balance below zero.

An overdraft facility can be a solution, but only once you’ve ruled out the alternatives, because it can be quite expensive.

Compare business bank accounts with overdrafts

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Finder Score	Account fee	Bank transfers	Requires credit check	Account management	Key benefits	Business bottom txt
Finder score 9Excellent Allica Bank Business Rewards Account	Finder score 9Excellent	Free	£0	Sage, Xero	Online & app	Earn up to 4.08% AER (variable) on your business savings*.	*Rate includes standard rate of 2.83% AER (minimum balance applies) plus a 0.5% boost each month if you make 15 bank transfers out of the account in the previous month, a 0.5% boost for six months if you complete a switch with CASS and a 0.25% welcome boost for 3 months when you deposit £50,000 or more within 14 days from opening account. Eligibility criteria and T&Cs apply. You must be incorporated for a minimum of 12 months and keep a balance of £50,000 or more in your account.	Go to site More info Compare product selectionCompare	loading
Finder score 8.3Great NatWest Startup Account Free Trial	Finder score 8.3Great	Free	£0.35 Free for 2 years, then standard tariff applies	FreeAgent	Branch, online, app & phone	Free banking on everyday transactions for the first 2 years*. T&Cs apply.	Available for businesses trading for <1 year with a turnover of <£1m that are registered for income or corporation tax in the UK. Other fees & charges may apply. Standard Tariff applies after the free banking period. To apply you must be 18+, owner or director of the business and can't have been declared bankrupt or received a County Court Judgment or Court Decree.	Go to site More info Compare product selectionCompare	loading
Finder score 9Excellent Zempler Bank Business Go	Finder score 9Excellent	Free	£0.35 Free for first 3 payments sent each month (£0.35 for every transfer thereafter)	Clear Books, FreeAgent, KashFlow, QuickBooks, Sage, Xero	Online & app	Go to site More info Compare product selectionCompare	loading
Finder score 8.9Great Zempler Bank Business Extra Offer	Finder score 8.9Great	£9 per month	£0.35 Free for first 20 payments sent each month (£0.35 for every transfer thereafter)	Clear Books, FreeAgent, KashFlow, QuickBooks, Sage, Xero	Online & app	No annual or monthly fee when you apply using the Finder link	More info Compare product selectionCompare	loading
Finder score 9.4Excellent Monzo Business Lite	Finder score 9.4Excellent	Free	Free	FreeAgent, QuickBooks, Xero	Online & app	Only sole traders or limited company directors in the UK can apply. Ts&Cs apply.	Go to site More info Compare product selectionCompare	loading
Finder score 9Excellent Monzo Business Team	Finder score 9Excellent	£25 per month	Free	FreeAgent, QuickBooks, Xero	Online & app	Only sole traders or limited company directors in the UK can apply. Ts&Cs apply.	Go to site More info Compare product selectionCompare	loading
Finder score 9.9Excellent Monzo Business Pro	Finder score 9.9Excellent	£9 per month	Free	FreeAgent, QuickBooks, Xero	Online & app	Only sole traders or limited company directors in the UK can apply. Ts&Cs apply.	Go to site More info Compare product selectionCompare	loading
Finder score Not yet rated Unity Trust Bank Unity Current Account (under £100k)	Finder score Not yet rated	£7 per month	£0	N/A	Branch, online & phone	More info Compare product selectionCompare	loading
Finder score Not yet rated HSBC Business Banking Account Free Trial	Finder score Not yet rated	£10 per month (waived in first 12 months)	£0	QuickBooks, Sage, Xero	Branch, online, app & phone	More info Compare product selectionCompare	loading
Finder score Not yet rated AIB (NI) Business Current Account Free Trial	Finder score Not yet rated	£9 per quarter (waived in first 24 months)	£0.430	N/A	Branch, online & app	More info Compare product selectionCompare	loading

Showing 10 of 56 results

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What’s a business overdraft?

A business overdraft is not unlike a personal overdraft: it’s a feature of your business current account that allows you to keep spending even if your account balance goes below zero.

Just like with personal accounts, you can choose whether or not you want one as part of your account. There are quite a few fees and costs (more on this below), so you should weigh up options carefully before applying.

Business overdrafts are a flexible, if not cheap, way of borrowing money, and can help you with unexpected costs (bills, invoices and so on) as well as with occasional cash flow issues.

Can I get a business bank account with an overdraft?

Most traditional banks offer business overdrafts with their business accounts, and even some challenger banks will let you apply for one.

Business overdrafts are more often unsecured, but some banks may also offer a “secured” option, which means you’ll have to use your business assets as collateral.

Limits, interest rates and fees will depend on the bank, on your business’s turnover, and on how much you borrow during the year.

How much does a business bank account with an overdraft cost?

There are two main sets of costs to take into account:

Interest rate. This is only charged if you do in fact end up using your overdraft. The rate you are offered will often depend on your business turnover and credit score. The final cost will also depend on how long it takes you to pay the overdraft back. The rate is usually variable, which means that it changes with the Bank of England official base rate.
Fees. These tend to be fixed and are charged annually or monthly. Some banks will charge it whether you use the overdraft facility or not (and call it something like “arrangement fee”).

The advertised interest rate on business overdrafts is often quite decent, but do keep in mind that it is not necessarily the same as what your business will be offered (which will largely depend on its credit score).

On fees, make sure you have read the terms and conditions carefully so you know what and when you’ll be charged. You should also watch that you don’t go beyond your arranged overdraft’s limit to avoid any unauthorised borrowing fees, which can be quite hefty.

Will I be credit-checked if I apply for a business bank account with an overdraft?

Yes, the bank will check your business credit score. Depending on how it is, your business may be refused the overdraft application or offered a higher rate.

However, many banks will let you check your eligibility first. Using a so-called “eligibility checker” is always a good idea because it will tell you how likely your business is to get accepted without leaving a trace on your credit record.

Who might open a business bank account with an overdraft?

An overdraft can be a good option for a number of businesses, from very small to bigger ones.

However, it should be seen as a safety net you can fall on if something goes wrong more than as a line of credit to use regularly. It is a fairly expensive way of borrowing money, so if you need it often, you may want to look for a cheaper solution.

For example, you can consider a business credit card, which can help your business cash flow and lets you borrow interest-free as long as you always pay back your bill on time. Fees also tend to be lower than with overdrafts and you might get additional benefits too.

Pros and cons of business overdrafts

Pros

Business overdrafts are a great safety net to cover unexpected costs.
You can use the funds for any purpose.
They are very flexible; you can borrow money anytime and pay it back anytime.
You only have to pay interest if you do in fact use the overdraft facility.
Quick to arrange as it's just an extra feature of your business account.

Cons

Fees can be quite high, even if you don't use the facility.
As overdrafts are part of your business account, shopping around for the best deal is a bit hard unless you are prepared to switch the whole account.
Only available to businesses that have a pretty good credit score.

Bottom line

Just like personal overdrafts, business overdrafts shouldn’t be used all the time; but they can be good to have if anything goes wrong and your business has to face extra costs.

Be especially careful when applying and make sure you have read and understood all the fees and costs (particularly what happens if you go over the credit limit).

Frequently asked questions

Sources

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you. Most of the data in Finder's comparison tables is provided by Defaqto. In other cases, Finder has sourced data directly from providers.

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Written by

Valentina Cipriani

Writer

Valentina Cipriani was a writer at Finder UK. She wrote news, features and guides about banking and credit cards, helping people to improve their financial lives. She holds an MA in International Journalism. See full bio

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