How to Open a Business Bank Account for an LLC in 4 Steps

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    Every penny has its place in a small business. The last thing any business owner wants is to be tracking each one down to make ends meet. With a business bank account for your LLC, you can carefully manage funds and access extra services to help your business grow. Read on to learn how to open one in four easy steps.

    How to Open a Business Bank Account for an LLC in 4 Steps

    Determining the best business bank account for your LLC can be an overwhelming task. This guide has everything you need to open a business bank account in no time.

    Step 1. Decide on a Business Bank Account Type

    Before anything else, analyze the different types of available accounts and decide what your business needs. While you may settle on one, you’ll likely select a couple to get the biggest bang for your literal buck.

    Here are the five most commonly used business bank account types:

    Business Checking Account

    In just about every circumstance, you’ll want to have a business checking account as the foundation of your financial operations. These accounts allow your business to transfer funds, make payments to vendors, and accept deposits from customers or other businesses.

    Most business checking accounts also have ways to deposit and withdraw money from ATMs that are part of a particular network. It’s important to keep the lion’s share of your funds in this account to cover outgoing expenses, lest you experience an overdraft.

    The majority of these checking accounts have transaction limits, forcing you to plan out a monthly strategy to avoid penalties. Exceeding a set amount each month typically results in per-transaction fees. Some of the best business checking accounts remove these restrictions. 

    While few and far between, there are interest-bearing checking accounts where you can earn interest each month on money within. Rates tend to be low, although Bluevine sets the bar high here.

    Business Savings Account

    Business savings accounts are often a great place to store funds you don’t plan to use immediately. If you’re saving up for a larger investment, such as a store expansion or equipment purchase, a business savings account is likely the best option.

    Here, your money will accrue interest at an advertised rate. If you shop around, you’ll find accounts with higher interest rates than others. The determining factor here is usually a minimum balance requirement to lock in a rate and negate service fees.

    The downside of business savings accounts is limited withdrawals. It’s not possible to take out funds more than six times in a month, potentially leaving money inaccessible. In most cases, you can’t write checks or use a debit card to pull cash from this account type. Some banks may limit deposits into the account as well.

    Business Money Market Account

    Business money market accounts function similarly to business savings accounts. They often feature higher interest rates and may allow you to write checks or use debit cards to pull money directly from the account.

    This extra flexibility comes at a cost. Money market accounts usually have higher initial deposits and monthly balance minimums. Some may have unavoidable fees and come with a limited number of transactions.

    Business Certificate of Deposit (CD) Account

    Business certificate of deposit accounts take money savings to a whole new level. CDs often have the highest interest rates but come with a significant catch.

    When you place money into a CD, you agree not to touch those funds for a set amount of time, referred to as the term of the CD. Depending on the CD account you choose, this time can range from months to years.

    The rate you earn from a CD comes from the amount of your deposit and the term of the CD you’re storing money in. You need to be sure that this is money you won’t have to use under any circumstance for its duration.

    Should you need to pull your money out before the CD comes to term, the consequences can be dire. Be prepared to pay steep penalties that could destroy any earnings you hoped to attain.

    Merchant Account

    If your small business accepts credit or debit card payments either in person or online, you’ll need a merchant account. Merchant accounts serve as a temporary medium for these payments before automatically moving to one of your other accounts. The entire process can take a few days before you see the result in your account.

    The bank or company you’re using to set up your merchant account likely has hardware or software you’ll need to use to accept payments. In addition to fees for equipment or setup, there will be transaction fees and maybe monthly charges to contend with.

    You’ll usually enter into a contract for a merchant account for one to three years with specific terms. While a merchant account is necessary for accepting card payments, be sure to weigh all these fees before signing on the dotted line. 

    Step 2. Find the Ideal Bank

    With a good idea of which business bank account types your company needs to operate, it’s time to hunt for the perfect bank. Consider the following factors when searching so you don’t end up paying too much or find yourself without the features you really need.


    Banks have staff to pay and lights to keep on, so they have to make money somehow. For businesses, this often means monthly service fees or charges for using certain services.

    It’s pretty common to find banks charging maintenance fees to keep accounts open. The best options provide the means to waive these charges through specific criteria. Some have no way to avoid these fees, so be sure to investigate. Online banks like Axos and Lili have free business banking accounts without any monthly fees at all. 

    Fees pop up in other areas as well. In-network ATMs are free to use, but expect to pay for out-of-network machines. Since online banks don’t have physical locations, they often charge for cash deposits through an ATM.

    Most banks charge for transactions and cash deposits beyond a listed amount each month. You’ll likely pay a flat rate for wire transfers into and out of your business.

    Required Minimums

    Banks typically require a minimum balance to waive those monthly service charges mentioned above. Make sure this amount is well within your company’s capability while keeping in mind your regular business expenses.

    Balances can also set the stage for the interest rate on your checking or savings account. Generally speaking, the more you have, the higher your rate can be. Some banks do have a flat rate you can’t do anything about.

    There may be an initial deposit requirement to create your account in the first place. This amount typically runs higher than any minimum balance needed for maintenance to ensure you won’t go under.

    Interest Rates

    If you have funds to spare, storing them in a savings account or interest-bearing checking puts some extra money into your company’s pocket each month.

    These accounts are known to offer interest rates simply for setting money aside. It’s an even bigger win if this money goes toward a big purchase or upcoming expense and won’t be used for business operations.

    With the national average interest rate at 0.23%, anything around this number or higher should taste pretty sweet.

    Online Banking

    Even before the rise of online banking, many traditional institutions started turning to online banking for the sake of convenience. Not only does an online presence allow a bank to attract members from across the country, it allows businesses to use financial services from anywhere with an internet connection.

    Choosing a bank with a top-tier mobile banking app like Capital One or Chase can make life a whole lot easier. No longer do you have to drive to a location and wait in a queue to render services.

    The best mobile banking apps allow you to perform transactions, monitor accounts, and set alerts to inform you when money moves around. You can even deposit checks with your phone’s camera and find the nearest in-network ATM with a tap.

    Business Services

    Business bank accounts come with additional services you can use to help your company grow. Tools for accounting and payroll are often available, and institutions like Bank of America offer rewards for doing business with them. Make a list of what your business needs and pursue the banks with those services.

    Some banks specialize in a particular field. For instance, Novo is an excellent option if most of your sales come from online sources. The business banking platform integrates with popular e-commerce sites like Shopify and Etsy, making sales easier than ever. 

    Step 3: Gather Your Documentation

    After deciding on a bank, you’ll need to round up your business paperwork. Financial institutions may differ on what they’re looking for, but you should be in good shape if you have the following:

    Articles of Organization: Your articles of organization reveals your company’s structure and purpose. In some states, this document is known as a Certificate of Formation or a Certificate of Organization.

    Employer Identification Number (EIN): As an LLC, requesting an EIN from the IRS is always a good idea. You’ll need one if you have more than one employee or you plan to hire people somewhere down the line. Single-employee LLCs can get by with a social security number, but this muddies the water between personal and business. You can usually get an EIN online quickly through the IRS, but plan for delays just in case.

    Operating Agreement: An operating agreement outlines how your company functions financially and who can sign off on your behalf. Banks will want to know who they can do business with from your company and who doesn’t have the power to make decisions.

    Photo Identification: Have two forms of identification ready when you go to create your account. One of these will need to be a photo ID (driver’s license or passport), whereas the other can be a bill, voter registration card, or credit card.

    Business License: Your business license will come from the state once you’re an officially registered business. It shows the bank you are a legitimate entity and the state you can operate out of.

    Step 4: Sign Up

    With documents in hand, it’s time to make your business bank account a reality. If the bank you chose has a branch nearby, stopping in can be a quick and painless experience.

    A banker will sift through your paperwork and ensure you’ve brought everything you need. While the documents listed above should be enough, researching in advance can save you from making an additional trip if you forget something.

    Some banks can create an account for you on the spot, while others may take a few days to process everything. You’ll need to have all the members of your LLC present at this point to avoid any snags.

    Alternatively, many financial institutions allow you to sign up for their services online. The process can vary immensely from bank to bank.

    Fintechs like Lili boast its signup takes a few minutes from start to finish, with nothing more than a cursory view of your paperwork. Others require careful scanning and submission of documents through an online portal for review.

    Check with your preferred bank before you go down this route, as it can just as easily save time as add several headaches when things don’t do exactly right.

    Does My LLC Need a Business Bank Account?

    By law, LLCs are not required to have a business bank account to operate. Still, every LLC should have one for the many benefits they provide.


    LLCs offer limited liability protection, meaning your personal assets are typically safe in the event a lawsuit targets your business. If you don’t use a business bank account, there may be no way for the court to tell where personal ends and company finances begin.

    In effect, you’re risking your personal assets by not having a separate account specifically for your business. Opening your business account with an EIN instead of a social security number helps protect you from cyberattacks that can sell your identity on the dark web.


    For the most part, it’s quite a challenge to move money around in your business without a business bank account. These accounts allow for all sorts of transfers, from wires to direct deposits and sending money from one account to the other.

    Many offer a number of free deposits and withdrawals each month without you having to pay. Without a business bank account, it’s unlikely that you’ll be able to accept credit or debit card transactions at all.


    There’s no better way to track your business funds than having all your transactions take place from a single location. At a glance, you can see your costs and revenue each month while tallying exactly where those big expenses go.

    Knowing your bottlenecks and what affects your bottom line can help you build a better financial structure. It also gives a sense of how your overall business is doing and areas you can improve.


    With personal funds out of the picture, tax time becomes much more straightforward. A bird’s eye view of all your debits and credits helps you quickly identify what you owe when the IRS comes knocking.

    Having thorough documentation also helps you pick out deductions you might otherwise miss. Clarity on your end may also reduce the likelihood of an audit.


    Setting up an actual business bank account helps you look more favorable in the eyes of potential clients or vendors. Checks and payments coming from a bank account with your business name appeal to the masses. They’re much more likely to jump on board with a company series enough to have a business account of its own.

    Many banks will want to build credibility with you before offering tools like business credit cards or lending options. Starting early puts you in a prime position to get approved when you actually need these services.

    How to Open a Business Bank Account for an LLC Frequently Asked Questions (FAQs)

    Want to learn more about how to open a business bank account for an LLC? This section answers some of the most common questions about the topic.

    Bottom Line on How to Open a Business Bank Account for an LLC

    Opening a business bank account for your LLC starts with careful consideration of the accounts you’ll need. From there, you’ll want to choose a bank offering features to grow your company with fees and balance requirements you can safely manage. Finally, you just need to gather your formation documents and sign up either in person or online.

    Best Business Bank Accounts by State

    Below you will find an interactive U.S map that can help you locate and compare different banks and financial institutions that offer business accounts in your area.