It used to be simple to set up a simple business account, but today ID checks and tough measures to get approved, means the small indie shopkeeper or online entrepreneur may have trouble even getting an account, especially if you don’t want to pay huge fees. See how to (simply) verify your identity and set up a virtual office address.
Ethical Business Accounts
These are not instant, so you’ll have to go through the usual rounds of getting approved. But at least you know in these cases, your money is being used to do good.
- Reliance Bank is owned by the Salvation Army, so profits help homeless people. You get free banking for the first 6 months (conditions apply), a visa debit card, Internet banking and access to high street banking services.
- Unity Trust Bank is a Carbon Literate Bank part-owned by employees (who are offered up to 5 paid days a year to volunteer in their communities – it also pays a Living Wage and pays Fair Tax). This bank is much simpler to join than others (just ID needed) as there are no debit cards (their safety net is that you need £500 to open an account, so wait until you start earning!)
- Charity Bank has a range of business savings accounts (minimum £10,ooo) that are simple to operate by post or email. Money is used to do good in local communities.
Online Business Accounts (smartphone needed)
- Tide has over 350,000 business customers. Create statements and manage direct debits in the app, schedule payments and export transactions. You can instantly link to accounting software, and review account limits (and request changes) in the app.
- Starling Bank offers a digital account used by over 400,000 businesses, with free 24/7 support and no monthly fees. Or for a small monthly fee the Business Toolkit creates invoices, does your taxes and records VAT. There are also accounts for Euros or US dollars.
- Monzo has a lite (free) version of its online bank account. You get Tax Pots to put money aisde, there is a small charge to pay in cash.
- ANNA has very low costs and you can earn points to pay for train travel. You also get a web page with link to your personal profile.
A Business Account (with no credit checks)
Card One Money offers something many people would like – guaranteed acceptance for bad credit (some reviews say the opposite, so check first), so ideal for someone who is trying to better their life by setting up a small business. There is a £55 joining fee (and small monthly fee).
This ‘bank’ is NOT covered by the Financial Services Regulation (but has its own system with funds are held in a safeguarding account). But you could always ‘get on the ladder’ with this account to get a business account, then swap later on as you start to earn more money, if you wish to be more legally covered. No credit checks here, but you do need (as ever) to proof your ID and residency.
Simpler Alternatives to Paypal
Paypal may be used by millions, but has many critics (1 star average over 20,000 reviews). Some simpler alternatives to explore are:
