For years the only difference between business bank accounts and personal bank accounts has been that business bank accounts cost a lot more in fees.
But the Cyclopean eyes of Canada's big banks have finally alighted on small business banking and, having decided that small business owners are a worthy market, the banks are actually competing with one another to create business bank accounts that small business owners will find attractive - and that means creating small business bank accounts with lower bank fees.
Here are the best business bank accounts for Canadian small businesses based on their monthly costs. (Note that this article discusses Canadian dollar accounts only.)
Business Bank Accounts for Low-Volume Businesses
HSBC's Business Direct Account may be just the business bank account you're looking for if your Canadian small business doesn't have a high volume of banking transactions and you have Internet access.
As you see in the page linked above, the HSBC Business Direct Account features include:
- Unlimited free Business Internet Banking, ATM and Business Telephone Banking, including free transfers, bill payments and electronic deposits and withdrawals
- 20 free cheques deposited per month
- Write up to 20 cheques free per month
There are charges, of course, for services above what the account offers, but still, a business bank account with chequing and no monthly fee is something a lot of us have been looking for a long time.
Compare Business Bank Accounts
The small business bank account I've found that comes closest to this HSBC Business Direct Account is the Bank of Montreal's Small Business Banking Plan, which can be free if you maintain the required monthly minimum balance of $4000. Otherwise, there's a $9.50 account maintenance fee. You are allowed 15 monthly transactions and 20 monthly items on deposit; transactions over the limit cost $1.00 each.
The Royal Bank offers an RBC Business Essentials Fixed-Fee Account™. For a monthly business bank account fee of $20.00 you get:
- Up to 20 debits/cheques each month
- Up to 15 credits/deposits each month
- Up to 20 items deposited each month
- Up to $2,500 cash deposited each month.
Pay-As-You-Go Business Bank Accounts
If your small business doesn't do a lot of banking business each month, you don't regularly maintain enough of a bank balance to possibly get your business bank account's monthly fee waived, and you want to use the services of a bank teller now and again, the most inexpensive business bank account for you may well be an account where you pay by the transaction. Best bets for business bank accounts are:
RBC's Business Essentials Variable Pricing Account™, a pay-as-you-go account that charges $0.90 for each paper-based transaction, $0.60 for each electronic one, and up to $2.25 for each $1,000 deposited, although there is a $6.00 monthly minimum charge. Online and telephone banking are included with the account.
Scotiabank's Basic Business Account is a chequing account which has an account maintenance fee of $9.00 a month. In addition, you're charged for all your transactions on a pay-per-use basis. Each cheque, for instance, costs $0.85, while each item deposited to your account costs $0.18.
CIBC's Basic Business Operating Account's maintenance fee is $8.00 a month, while each transaction cost $0.90.
On the next page, you’ll find information on what I think are the best business bank accounts for savings and other small business bank accounts with special features that you may want. Click to continue reading.