Compare free business bank accounts

December 2024

Tired of being overcharged and underserved on your business bank account?

Depending on your businesses circumstances, you may be able to use a free business bank account. Ensure you’re getting the best deal with our quick and simple comparison tool.

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What is free business banking?

Free business banking is simply business banking with no fees attached. In other words, if you open a free business bank account you won’t have to pay a monthly or annual fee and there will be no charge for setting up the account itself either.

The main advantage to choosing free business banking is that it will enable you to keep some of your overheads low, which can be particularly beneficial when you’re just starting out and building your business.

You’ll be legally required to open a business bank account if you’ve set up your business as a limited company in the UK and it’s registered with Companies House, so it may be worth looking for one with no fees. If you’re a sole trader, such as some freelancers and contractors, you won’t be obliged to open a business bank account but having one can make keeping your business and personal finances separate that much easier.

Are there still charges with a free business bank account?

Although your business bank account may not charge a monthly, annual or set-up fee, you may still have to pay for certain services. These can include:

Electronic payments: such as faster payments, bill payments, direct debits and standing orders
Cash payments: including deposits and withdrawals via a bank branch as well as transactions at a Post Office counter. If this is something you’ll be doing regularly, look for an account that offers the lowest fee
Cheque payments: you may have to pay for writing and depositing cheques
Additional payments: some accounts will charge for CHAPS payments and issuing a banker’s cheque
International payments: you may also be charged for sending money to an overseas account or for any purchases or cash withdrawals made using your card abroad
Overdrafts: some banks charge an overdraft set-up fee, as well as a daily fee, or you may be charged interest

Note that fees can vary depending on the business bank account you choose, and some won’t charge many fees at all, so it’s worth shopping around and comparing your options carefully.

You should also keep in mind that some business bank accounts have introductory offers that waive monthly or annual fees for 12 to 18 months. Once this period is over, you’ll have to pay a fee so if you’re considering one of these accounts, make sure you check in advance how much you’ll be charged.

Which is the best free business bank account?

The best free business bank account for you will depend on the type of business you run and how you plan to use the account. The quickest way to find the most suitable business account is to compare your options using our business bank account comparison tool. You’ll be able to select ‘free banking’ on the features tab to view all free business bank accounts from providers such as Anna and Revolut.

Anna’s free business bank account offers services such as invoice management which can help you to create and send invoices, and it automatically matches payments and invoices to help you organise your accounts. The account also offers:

Free ATM withdrawals up to £100 per month
Free UK transfers up to two per month
1% cashback on purchases
Free direct debits

Meanwhile, Revolut’s free business bank account allows you to send and receive funds in more than 28 currencies at the real Interbank exchange rate. It also offers five free local transfers a month (after which you’ll be charged 20p per transfer), while international transfers are competitive at just £3 each and a 0.4% fee applies to all foreign exchanges.

You’ll also be able to link your account up with third-party software providers such as Xero, QuickBooks, FreeAgent and Sage.

Best UK business bank for customer service – 2023 survey

In August 2023 the BVA BDRC published the findings from its Business Banking Service Quality survey. Undertaken as part of a regulatory requirement and published at the request of the providers and the Competition and Markets Authority, the study surveyed 18,000 SME bank account customers between July 2022 and June 2023.

Each customer was asked how likely they would be to recommend to other SMEs –

Their provider?
Their provider’s online and mobile bank services?
Services in-branch and in business centres?
Their provider’s SME overdraft and loan services?
Their provider’s relationship/account management services?

The results show the proportion of customers of each provider, among those who took part in the survey, who said they were ‘extremely likely’ or ‘very likely’ to recommend each service. A detailed breakdown for each category can be seen in the table below.

Source: BVA BDRC

Ranking	Provider	Score
1	Monzo	84%
2	Starling Bank	82%
3	Handelsbanken	74%
4	tide	73%
5	Metro Bank	63%
6	Santander	59%
7	Lloyds Bank	58%
8	Bank of Scotland	54%
8	NatWest	54%
10	Barclays	50%
11	TSB	49%
11	Royal Bank of Scotland	49%
13	Money	48%
13	The Co-operative Bank	45%
15	HSBC	42%

Ranking	Provider	Score
1	Monzo	87%
2	Starling Bank	86%
3	tide	76%
4	Lloyds Bank	68%
4	NatWest	68%
6	Barclays	64%
6	Metro Bank	64%
6	Royal Bank of Scotland of Scotland	64%
6	Bank of Scotland	64%
10	Santander	59%
11	Handelsbanken	56%
11	TSB	56%
13	Money	55%
14	HSBC UK	54%
15	The Co-operative Bank	38%

Ranking	Provider	Score
1	Handelsbanken	64%
2	Lloyds Bank	57%
3	NatWest	56%
3	Metro Bank	56%
5	HSBC UK	53%%
6	Bank of Scotland	51%
6	Santander	51%
8	Royal Bank of Scotland	50%
9	Barclays	49%
10	Money	45%%
10	TSB	45%
	*The ranking does not include any brands where the eligible sample size is less than 100 (Starling Bank, tide and TSB are excluded from this table)

Ranking	Provider	Score
1	Handelsbanken	81%
2	Monzo	73%
3	Tide	69%%
4	Starling Bank	68%
5	Metro Bank	63%
6	Lloyds Bank	58%
7	NetWest	54%%
8	Santander	53%
9	TSB	51%
10	Bank of Scotland	50%
11	Royal Bank of Scotland	49%
11	Barclays	49%
13	Money	44%
14	The Co-operative bank	42%
15	HSBC UK	40%

Ranking	Provider	Score
1	Metro Bank	70%
2	Handelsbanken	61%
3	Lloyds Bank	55%
4	NatWest	53%
4	Bank of Scotland	53%
6	Santander	50%
7	The Co-operative Bank	47%
8	Money	46%
9	Royal Bank of Scotland	42%
10	Barclays	40%
11	TSB	39%
12	HSBC UK	33%
	*Monzo, Starling Bank and tide are excluded from this measure as do not operate a branch network

Frequently asked questions

Who can get a free business bank account?

You’ll usually be able to apply for a free business bank account if you’re a sole trader, private limited company, public limited partnership or limited liability partnership.

Many free business bank accounts are aimed towards smaller businesses and startups which means your business may need to have been trading for less than a year and/or have a turnover of less than a specified amount. Check the terms and conditions carefully so you know whether you’ll qualify.

Note, too, that you’re more likely to get accepted for a business bank account if you have a good credit rating and no history of defaults or arrears. A credit check will usually be carried out when you apply for a business bank account and if your credit score is poor, you’re more likely to be turned away.

Fortunately, some app-based providers, such as Anna, won’t require a credit check as part of the application process which can make them a good option if you have a poor credit history – although keep in mind you may not be offered an overdraft.

How long does it take to get a free business account?

You can usually apply for a free business bank account online or via the provider’s app in as little as 15 minutes. The approval time will then depend on the business circumstances.

If you choose a digital bank, your free business bank account will usually be up and running within just a few days – in some cases your account can even be opened on the day you applied for it. If your account comes with a debit card, this should also be with you within around five working days.

Note that due to the COVID-19 pandemic, many high street banks are taking longer than usual to process business bank account applications, so you may find opening your account takes a matter of weeks. However, this will depend on the provider.

How do I open a free business bank account?

The quickest way to apply for a business bank account is online – simply compare your options using an online comparison tool and click through to the account you want to open. You’ll then be able to fill in your application form online.

Alternatively, you may be able to open your account over the telephone or in branch depending on which account you’ve chosen.

As part of the application process, you will need to provide proof of ID such as a passport or driving licence, along with proof of address such as a utility bill or bank statement. If you’re applying via a digital bank, you will be asked to upload photos of your ID and record a short selfie video for identification purposes.

You may also need to provide:

Your full business address and contact details
Estimated annual turnover
Details of your company’s registration at Companies House if you’re a limited company
Tax and VAT registration details

Once you’ve provided the required documents, your chosen provider will set up your account and you’ll be ready to go.

Written by

Rachel Wait

Rachel has been writing about finance and consumer affairs for over a decade, helping people to get to grips with their finances and cut through the jargon. She's written for a range of websites and national newspapers including MoneySuperMarket, Money to the Masses, Forbes UK, and Mail on Sunday. Rachel has covered almost every financial topic, from car insurance and credit cards, to business bank accounts and mortgages.

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