What Do I Need to Open a Business Bank Account? Full Checklist

Opening a business bank account is a big step. It can help you build business credit, simplify your tax returns, and protect your personal assets from business losses and liabilities.

Most business owners at some point ask the question: What do I need to open a business bank account? This guide includes the full checklist of all the documents you need, plus tips on choosing the right type of account for your needs.

Benefits of Having a Business Bank Account

Business accounts offer a range of legal, financial, and social benefits for you and your customers. Consolidating your cash flow simplifies bookkeeping, business tax planning, and payroll. Business bank accounts also create a sense of legitimacy and professionalism with customers and investors.

If you own certain business enterprises, you may gain limited liability protection, which means collectors can’t target your personal assets to pay off the business’s debt.

A business account can also guarantee buyer protection for purchases, especially for credit, debit, and mobile-wallet transactions. These protections go a long way in building trust and can improve your reputation and customer retention.

Types of Business Bank Accounts

So what do you need to open a small business bank account? Are there different requirements for different business structures?

Before you start, you need to decide which type of business account(s) you need. Sole proprietorships may only need checking accounts, but small to medium-sized businesses may need more than one type of account.

Do you need to handle payroll, accept customer payments, earn interest, or improve your credit? Depending on your needs, you may want to open a checking, savings, or merchant account — or more than one of these.

Checking Accounts

A business checking account is typically the first account you’ll open when starting a business. You can use it to make deposits and withdrawals, pay bills, and manage payroll. You also get access to business debit cards and checks.

Check out our U.S. Bank Business Checking Review and see how it compares to other options.

Savings Accounts

If you’re starting to gain traction and have extra money sitting around, saving accounts for businesses are ideal for storing money and earning some interest. You can use these accounts for emergency funds, large purchases, future investments, or tax purposes.

A high-yield savings account can be useful for businesses as well as individuals because it will earn you significantly more interest than a typical savings or checking account.

Merchant Accounts

If you need to accept credit/debit card payments in person or online, you probably need a merchant services account. Retailers, restaurants, food trucks, and online stores typically need this type of account, but service-based businesses can also benefit.

Look for merchant accounts that integrate with point-of-sale (POS) systems, have robust security protocols, and incorporate tools like invoicing and payment portals.

Required Documentation

Once you’ve decided on the type of account you want to open, you may wonder: “What documents do I need to open a business bank account?”

In general, you’ll need to provide your preferred financial institution with the following documentation to open a bank account for your business:

• Personal identification: driver’s license, SSN number
• Business information: name, address, and structure
• Business license: document allowing you to operate within a jurisdiction
• Employer identification number (EIN): acts as a federal tax identification number

Requirements Based on Business Structure

In addition to showing your business license, you may need to provide documents proving business formation for your particular business structure:

• Corporation: Articles of Incorporation
• Limited liability company (LLC): Articles of Organization
• Businesses with a trade name: Doing Business As (DBA) certificate
• Partnerships: Partnership Agreement

Choosing the Right Financial Institution

Traditional banks aren’t your only option. Credit unions sometimes offer lower business account fees and smaller minimum payments for business credit cards and loans. Local credit unions usually have a community-focused feel and more customized service that big banks can’t replicate.

Are you wondering: “What information do I need to open up a business bank account at a bank vs. a credit union?”

Many smaller credit unions have fewer requirements to open an account compared to national banks, and they may offer sign-up bonuses. But setting up your account can be slower, and you may not be able to do it online. The process may also be more complicated if you need to close a business account.

If your business operates in multiple states or you need to accept international payments, you’re likely better off with a traditional bank.

Tips for a Smooth Account Opening Process

Starting a business can be overwhelming, but opening a business bank account doesn’t have to be. Applying online makes the process easier and faster.

Though some traditional banks require in-person application and document review due to regulatory standards, many online banks offer fully online applications. If you have to go in person, call ahead to clarify which documents you’ll need and make an appointment.

Banks typically have a minimum opening deposit, maintenance fees, and transaction limits for business accounts. Fees differ widely, so it’s a good idea to shop around and familiarize yourself with each institution’s fee structure to avoid confusion or surprise expenses.

Common Challenges and How To Avoid Them

Common pitfalls when opening a business bank account include incomplete or inaccurate documentation, lack of credit history, or excessive minimum deposits or online fees.

Proper planning can help ensure the process runs as smoothly as possible. When it comes down to it, the best way to overcome these issues is to research, research, and research some more. Make sure you understand the rules and regulations in your state and look into various banks to find one that offers the services you need.

If you need to build credit, look for banks offering business credit cards for bad credit. A positive credit history is necessary to take out a business loan and attract investors. Whether you’re just starting out or you’re recovering from financial troubles, a business credit card is a powerful tool.

Learn More About Business Banking With MoneyAtlas

This guide addresses one of the most common questions new business owners ask: “What do I need to open up a business bank account?” But there are countless other questions you’ll face as you grow your business, and MoneyAtlas can help answer them.

MoneyAtlas is on a mission to help business owners, nonprofit organizers, individuals, and families build their financial knowledge with in-depth reviews of financial products like Found business banking to investment guides and comparisons of business savings accounts.

Compare the best business checking accounts to find the right one for your business today.