What you need before you walk in

A business bank account is a separate account for your business money, kept apart from your personal checking and savings. Banks require proof that your business exists and that you are authorized to open an account on its behalf. The documents you bring depend on what kind of business you have.

If you are a sole proprietor (you own the business by yourself with no formal business structure), you will need your Social Security number, a government-issued ID, and proof of your business address — a utility bill or lease works. If your business has a name different from your legal name, bring a "Doing Business As" certificate from your county clerk's office, or a copy of the registration you filed.

If you have formed an LLC, S-corp, or C-corp, bring your Articles of Organization or Articles of Incorporation — the document the state issued when you registered the business. You will also need an Employer Identification Number (EIN), which the IRS assigns to your business. You can get an EIN free from the IRS website (irs.gov) in minutes, or by calling 1-800-829-4933. Bring the EIN letter or your confirmation number.

Key Takeaways

  • Sole proprietors need a government ID, Social Security number, and proof of business address; LLCs and corporations need their formation documents and an EIN from the IRS.
  • Banks will ask for a personal may provide, meaning you personally vouch that the business will pay what it owes, even though the account is in the business name.
  • Minimum opening deposits range widely — some banks have none, others require $100 to $500 or more — so call ahead or check the bank's website before you go.
  • The account opens the same day or within one business day in most cases, though some banks mail a debit card separately.
  • You can open an account in person at a branch, by mail, or online depending on the bank and the type of business you have.

What banks ask for during the account opening

When you sit down with a banker, they will ask you to fill out a signature card — a form that records who is authorized to sign checks and withdraw money from the account. If you are the only owner, you sign it. If you have partners or employees who will handle the account, they sign it too, and the bank keeps a record of their signatures.

The banker will also ask for a personal may provide. This means you personally promise to cover the account if the business cannot — it protects the bank if the business fails or runs a negative balance. As the owner, you will sign this even though the account is in your business's name. This is standard practice and does not mean the bank expects you to fail; it is how they manage risk.

Some banks ask for a copy of your business plan or a letter explaining what the business does. Others ask for proof of income or tax returns if your business has been running for more than a year. A few banks, especially for new businesses, may ask for a personal credit check. This is separate from a business credit check — they are looking at your personal financial history to assess risk.

Minimum deposits and monthly fees

The amount you need to deposit to open the account varies by bank and account type. Some banks have no minimum; others require $100, $500, or $1,000 to open. A few require you to maintain a minimum balance each month to avoid a fee — if your balance drops below that number, you pay a monthly charge, often $10 to $25.

Monthly maintenance fees for business accounts typically run $10 to $30, though some banks waive the fee if you maintain a certain balance or set up direct deposit. Ask the banker what the fee is and what would waive it before you open. The fee structure matters more than the opening deposit — you will pay the monthly fee every month, but the opening deposit is a one-time event.

Some banks charge per transaction — each check you write, each deposit, each transfer costs a small amount. Others include a set number of transactions per month and charge for anything over that. Ask how many checks and deposits are included, and what the overage cost is if you think you will exceed it.

Opening in person, by mail, or online

Most banks let you open a business account in person at a branch. Bring your documents, sit with a banker, and the account opens the same day. You will get a temporary debit card or checks on the spot, though some banks mail these separately.

Some banks let you start the process online. You upload photos of your documents, fill out the application, and the bank reviews it. You may need to come in person to verify your identity and sign the signature card, or the bank may mail you documents to sign and return. This takes a few extra days but lets you start from home.

A few banks handle the entire process by mail — you mail in your documents and signed forms, and the bank mails back your debit card and checks. This is slower, usually taking one to two weeks, but works if you cannot visit a branch. Call the bank first to confirm they offer this option for your type of business.

Choosing between banks

Large national banks like Chase, Bank of America, and Wells Fargo offer business accounts at most branches. They have many locations and online tools, but their monthly fees are often higher ($15 to $30) and their customer service for small business is sometimes slower.

Regional and community banks often have lower fees and more personal service. They may waive monthly fees more readily and have fewer transaction limits. The trade-off is fewer locations and sometimes less sophisticated online banking.

Online-only banks like Square Cash for Business, Novo, and Mercury have no monthly fees and lower minimums, but you cannot deposit cash or checks in person — you have to mail checks or use mobile deposit. This works well if you rarely handle physical cash or checks, but not if you do.

Credit unions are member-owned and often have lower fees than banks. You have to be a member to open an account, which usually means living or working in a certain area or belonging to a certain profession. Ask if you are may be able to access before you apply.

What happens after you open the account

Once the account is open, the bank will give you a routing number and account number. You use these to set up direct deposit from customers, to pay bills online, and to receive payments from other businesses. Write these down and keep them safe — you will need them often.

The bank will issue you a debit card and checks. Checks arrive within a week or two if you order them from the bank; they cost $15 to $50 per box depending on the bank. Some business owners use online bill pay instead of checks, which is faster and leaves a digital record.

Set up online banking right away so you can monitor your balance, transfer money, and catch fraud quickly. Most banks let you set up alerts — the bank texts or emails you if your balance drops below a certain amount, or if a large transaction occurs.

Common mistakes to avoid

Do not mix personal and business money in the same account. This creates a mess at tax time and can expose your personal assets if the business is sued. A business account exists partly to keep these separate.

Do not assume all banks accept all business types. Some banks will not open accounts for certain industries — cannabis businesses, for example, face restrictions at most banks because of federal law. Call ahead and ask if the bank works with your type of business.

Do not ignore the fee structure. A bank with no opening minimum but a $30 monthly fee costs you $360 a year. A bank with a $500 opening minimum but no monthly fee breaks even after less than two years. Do the math for your situation.

Do not wait to open the account until you need it urgently. If you are starting a business, open the account before you start taking money in. Mixing personal and business funds from day one creates problems later.

Frequently Asked Questions

Do I need an EIN if I am a sole proprietor?

No. As a sole proprietor, you can use your Social Security number instead. However, getting an EIN is free and takes five minutes online, and it keeps your Social Security number private — a good practice for security. Many sole proprietors get an EIN anyway for this reason.

Can I open a business account if my business is brand new?

Yes. Banks do not require you to have been in business for any length of time. Bring your formation documents (or your "Doing Business As" certificate if you are a sole proprietor), your ID, and proof of address. Some banks may ask more questions about your business plan or personal credit, but most will open the account the same day.

What if I have bad personal credit?

Some banks will still open a business account even if your personal credit is poor, especially if your business has been running for a while and has good cash flow. However, some banks use personal credit as part of their decision. Call a few banks and ask their policy before you go in. Credit unions and community banks are sometimes more flexible than large national banks.

Can I open a business account online if I have an LLC?

Most banks let you start the process online, but you will likely need to verify your identity in person or by video call, and sign documents. Some banks complete the entire process online for LLCs. Check the bank's website or call to ask whether they offer full online opening for your business structure.

How long does it take to open an account?

In person at a branch, usually the same day or within one business day. By mail or online, typically three to five business days. Some online banks are faster — as little as one business day — but this varies. Ask the bank for their timeline when you start the process.