Finding the Best Banks for Small Business in 2019
The top banks for small business don’t just feature strong business checking accounts. They also offer many different small business lending opportunities and have solid experience handing out business loans.
|Wells Fargo Read More||0%||$25|| |
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|BBVA Compass Read More||0%||$100|| |
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How We Determine the Best Banks for Small Business
SmartAsset researched the small business offerings of nearly 30 national, regional and online banks. In particular, our experts examined the number and types of small business loans, small business checking account options and fees, any bonus services (business credit cards, payroll/benefits services, merchant services and small business insurance) and the total number of branches.
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Best Overall Bank for Small Business: Wells Fargo
Wells Fargo is the highest-rated bank for small business in our study. In fact, it’s the most active SBA lender in the nation, both in terms of actual financing and in loan quantity. So this bank has an extensive history in small business lending, backing that experience up with strong checking account offers too.
Lines of credit, secured and unsecured loans and commercial real estate loans are all available through Wells Fargo. This will give a business of any size multiple lending routes to take, affording you ultimate control in how to handle your finances. Depending on the type of secured or unsecured loan you want, terms are available for as much as $100,000 and will last anywhere from one to six years. Fixed interest rates start at 7.25% for unsecured loans, while vehicle loans and equipment loans open at 6.25% and 6.75% each.
In total, you’ll be able to choose between four different business checking accounts, each intended for gradually larger enterprises with higher transaction volumes: Simple Business Checking, Business Choice Checking, Platinum Business Checking and Analyzed Business Checking. At $10, $14, $40 and $22, respectively, these accounts have some of the lowest monthly fees compared to the accounts at other banks on this list. But you can make these fees disappear just by maintaining a monthly balance of $500 for the Simple Business Checking account, $7,500 for the Business Choice Checking account and $25,000 for the Platinum Business Checking account, while Analyzed Business Checking account holders must adhere to a variable fee waiver minimum.
Wells Fargo has quite possibly the most comprehensive set of business and employee services. Not only will you have access to its proprietary point-of-sale program and other merchant services, but the bank can also handle your employee payroll, HR needs and business taxes.
Best Overall Bank for Small Business Runner-up: SunTrust Bank
Regardless of the type of business checking account you open with SunTrust Bank, you will receive a $0 introductory maintenance fee. Those with a Simple Business Checking account get this bonus for 12 billing cycles, while Primary Business Checking and Business Advantage Plus Checking account holders receive two months without fees. All of these accounts still place as some of the cheapest on the business market following the intro offer, jumping to $5, $15 and $25, respectively.
Term loans with SunTrust can last up to 20 years, which is one of the longest terms on this list. This should severely lessen the strain a large loan could place on your business’ finances. As far as loan flexibility goes, this bank offers financing for vehicles, computers, office furniture and equipment for everything from a construction firm to a dental practice.
The SunTrust Small Business Credit Card is one of the strongest business credit cards you’ll come across. New cardholders receive a 0% introductory annual percentage rate (APR) for 12 months, along with no annual fee. The card also includes cash-back rewards, with 5% cash back on the first $2,000 spent a month on office supplies and gas (replaced by 3% cash back on the same categories after your first year) and 1% cash back on everything else.
Best Overall Bank for Small Business Runner-up: M&T Bank
Managing your personal finances can be difficult enough, so getting some help dealing with your business’ expenses should be welcome. M&T Bank tries to help on that account, as it provides business clients with what it calls “experienced relationship managers.” These aides will go over your business’ entire financial situation and build a plan specifically tailored to what you most need.
M&T is also one of the most active SBA lenders on the market, and features many different styles of business loans. These include unsecured installment loans, commercial real estate loans, investment real estate loans, equipment loans and secured term loans with both fixed and variable interest rates. Depending on what you’re looking for, these typically start at $10,000 and cap out at more than $100,000. Term lengths are flexible but generally won’t be more than 10 years.
Most of the checking options with M&T are pretty standard, but its BizFlex Checking account is rather unique. This account allows for a whopping $50,000 to be deposited each month without an extra fee, along with 1,000 free transactions per month. You can also link up to four BizFlex accounts together.
Best Small Business Checking Accounts: KeyBank
Based on our research, KeyBank came out on top as the best bank for business checking accounts. Most checking accounts will allow you to deposit between $5,000 and $15,000 a month before you’re charged fees. However, this bank provides a $25,000 fee-free cap for all of its accounts across the board. Those who decide to open a Business Interest checking account will get unlimited free transactions as well, while the Rewards and Basic accounts afford you only 500 and 50 monthly transactions, respectively.
Each of these accounts charge you maintenance fees every month too, ranging from $5 to $25. At most, you’ll only need an average monthly account balance of $7,500 to rid your account of these excess fees, which is reasonable in comparison to the rest of this list.
All checking account holders receive a debit card to use as they please. But much like a credit card, these can actually earn you rewards through Keybank’s Relationship Rewards® program. You will earn rewards points every time you swipe your debit card, use online bill pay, make ATM and mobile deposits or complete a number of other account-related activities. These points can later be redeemed for cash back, travel credit, gift cards and more.
Best Bank for Small Business Loans: BBVA Compass
Who better to make our list as the top bank for small business loans than the SBA’s top lender in 2015, BBVA Compass. The bank has an impressive array of different loans available for small business clients, like secured, unsecured and SBA Express-eligible lines of credit; short- and mid-term loans; and commercial real estate loans.
Traditional and convenience lines of credit can be as large as $100,000 if that’s what you need, though the SBA Express LOC caps at about a third of that at $35,000. Express lines of credit will be in your account within 24 hours of your application’s approval. This offers a nearly unmatched level of speed that could come in handy in times of trouble.
BBVA also employs stated income programs for up to $100,000 term loans. These loans are given to you totally based on your word, hence the “stated income” title. In other words, you won’t have to supply the bank with tax returns, pay stubs or any other financial documentation when applying for a stated income loan. This level of freedom is virtually never seen.
Best Bank for Start-Ups: U.S. Bank
If you’re looking for a small business loan, U.S. Bank should be one of your top considerations. You can choose from many different styles of loans with this bank, but start-ups should focus on what this bank calls “quick loans.” Although U.S. Bank usually requires prospective clients to have been in business for at least two years, young businesses founded as recently as six months ago can secure these loans.
There are two types of quick loans: one for equipment and expansion and one for vehicles. Each of these options start at $5,000, with vehicle quick loans topping out at $100,000 for up to 72 months and equipment/expansion loans limited to $250,000 for up to 60 months. Also, if you need a vehicle loan, it won’t require a down payment, further minimizing the financial stress such a loan could put on your business.
The Silver Business Package that U.S. Bank offers could be another major boon for start-ups. It comes with a cheap cost, including no monthly fees, 25 free cash deposits and 150 free transactions a month. You will also receive a debit card, remote check deposit and online/mobile banking, giving account holders just about everything they’ll likely need.
Best Online-Only Bank: Live Oak Bank
Live Oak Bank is an extremely industry-centric business loan and savings bank. In fact, it has experience in 17 different industries: accounting firms, investment advisor firms, pharmacies, hotels, agriculture, automotive care, education, family entertainment, funeral home/cemeteries, government contracting, healthcare/dental, insurance, renewable energy, self-storage, senior care, veterinary clinics and wine/craft beverages.
Depending on where you fall on this spectrum, Live Oak Bank will create a particular plan just for what you need, along with the help of an industry expert, if necessary. Aside from this, the bank is very active in financial technology, giving it a very cut-and-dried fact-driven mindset when dealing with small business lending.
While Live Oak doesn’t offer checking accounts, it does have small business savings and certificate of deposit (CD) accounts available. Savings accounts are given a 1.05% APY, which the bank claims is 11x the national average. On the other hand, the bank’s CDs range from six months to five years in length, with a 1.95% to 2.70% APY applied to them, respectively.