Starting a new business venture without a dedicated bank account may seem tempting, but it’s not a wise decision in the long run. As your business grows, it’s essential to separate your personal finances from your business finances. Mixing your personal and business finances can lead to complications down the line. New business owners tend to have a habit of commingling their finances, but it’s essential to treat your business like a business, no matter how big or small. Various business current accounts have different fees and expenses, so it’s crucial to shop around for the best options. If you’re a limited company, you legally need a dedicated business account. Still, if you’re a sole trader or part of a partnership, it’s not necessary but highly recommended.
Incorporating your business finances with your personal finances will make it difficult to prove to the government that you’re running a legitimate business. It’s essential to keep clear records and use a separate account to avoid any misunderstandings. Your business should operate with professionalism, and using a separate business account is a demonstration of that.
Opening a business bank account with various banks means you’ll have access to financial products such as loans, credit cards, and overdrafts. You should ask eight essential questions before choosing a business bank account. These questions range from whether they offer free banking periods, overdraft facilities, a business relationship manager, quality mobile and online services and how long it takes to open an account. It’s also essential to know the fees and when you’ll have to pay them.