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5 Things to Look for in a Business Bank Account

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Financial institutions frequently offer extra services to help its business customers save time and money. / Credit: usiness check image via Shutterstock

Financial institutions across the country want more business banking customers. To entice new small business owners and entrepreneurs, banks and credit unions offer a variety of bonus features with their business bank accounts. If you're on the hunt for a small business account, here are some popular extra services to look for. (Note: While some of these features may be included as part of your overall bank-account package, others require additional fees.)

As small businesses hire more employees, a bank-offered payroll service may simplify bookkeeping for busy small business owners.

"If you don't quite have the budget for an independent bookkeeper, many financial institutions offer access to payroll software or services to help you get things done," said Jennifer Martin, small business coach and owner of Zest Business Consulting.

Payroll services are also offered by independent payroll companies. Before signing up for the service through your own financial institution, compare the features of bank-offered programs against those offered by outside companies,advised Rohit Arora, CEO of Biz2Credit, an online credit resource for small businesses.

"In the case of bank-offered payroll, one should look at what happens in case of nonsufficient funds," Arora said. Make sure to compare the fees banks charge with those charged by normal payroll service providers, Arora said. [For a side-by-side comparison of the best payroll services, visit our sister site Business.com.]

Editor’s Note: Considering a payroll service for your business? If you’re looking for information to help you choose the one that’s right for you, use the questionnaire below to get information from a variety of vendors for free:

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One new feature popping up in banking packages is fraud insurance coverage.

"Fraud insurance is provided by the lending institution to prevent any loss in the business checking account because of fraudulent transactions," Arora said.

Arora explained that fraud insurance is important for business checking accounts in which more than one person has access to the account, especially when the accounts normally have multiple transactions on a daily basis.

"It's important to have fraud insurance included so that it not only prevents any loss of money through fraud, but also prevents any bounced checks by the vendors," he said. "This can lead to adverse remarks on the business credit." 

If you've been thinking about offering your employees retirement plans such as 401(k) plans or pensions, look beyond your insurance agent to your bank, Martin said. Increasingly, banks are offering retirement-account setup and maintenance as a bonus feature for their business customers. This is an attractive incentive when hiring employees.

"Retirement benefits can be a great way for you to more deeply invest in your staff and may be the difference between a great job applicant choosing you over your competition," Martin told Business News Daily.

If you plan to offer health insurance to your staff, using your own bank to make deposits into a health savings account for employees simplifies the process.  You may even save a little money by doing this.

"Some employers will save money on their payroll taxes as a result of making deposits directly to an employee HSA account, 401(k) or supplemental insurance program," Martin said.

Money-saving offers from other companies are valuable bonus features available with some small business banking packages. Martin noted that some banks offer discounts on partner goods and services because of the sheer volume of purchases by bank customers.

Ask your banker for a list of partner companies offering discounts to small business banking customers. Typical partners include hotels, insurance companies, airlines and office-supply stores.

One risk of issuing company credit cards is that staff may use them for nonbusiness expenses. A service that gives small business owners control over staff spending can reduce that risk.

"Busy employers are concerned about how much or what their employees are spending on their corporate credit cards," Martin said. "One of the newest features added to certain banks' offerings for small business owners is Visa card payment controls."

This feature lets small business owners set limits on daily spending, the days and times of transactions, as well as the locations or geographic areas where the cards can be used.

Banks regularly offer new features to their business banking customers. Keep your eyes open for features such as access to peer groups, bank blogs with useful business content, business-related classes and educational material, and financial planning services.

Originally published on Business News Daily.

Business News Daily Editor

Business News Daily was founded in 2010 as a resource for small business owners at all stages of their entrepreneurial journey. Our site is focused exclusively on giving small business advice, tutorials and insider insights. Business News Daily is owned by Business.com.