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How to set up business banking

6-minute read

Looking for a bank account for your business? Managing your money and cash flow is core to your business success – and choosing the right business bank account and business services will contribute to this. 

Key take-outs
  • Banks offer specific accounts and services for businesses
  • Separate your business banking from your personal banking
  • Research the options and choose services that best match your business needs
  • Establish a relationship with a business bank

What type of bank account do I need when starting a business?

One of the first things you may want to set up is a business bank account3, which for ease of accounting and reporting is separate from any personal accounts. It will record your income and outgoings, making it an important source of information at tax and BAS (Business Activity Statement) time.

 

This 'business transaction account' should be simple and reliable, and easily linked to and from any other business accounts you hold. Armed with an Australian Business Number (ABN) if you are a sole trader or Australian Company Number (ACN) if you are a company, you can generally apply for a business bank account online in minutes. Read more about these company structures in our Choosing a business structure article.

How can I enhance my business banking security?

When setting up your business bank account(s) you'll need to decide how many extra signatories you'll need (if any) and who needs access, such as your accountant or payroll employee.

 

You may also wish to consider extra security, such as a second-factor authentication token. These keyring-sized devices give authorised signatories access to specific account functions, including payments above any pre-determined daily limits.

What's the simplest way to manage my account?

Online banking gives you the flexibility to check balances, transfer funds and reconcile payments on the go 24/7. If you choose Westpac Live3 you can register online as a sole trader or partnership, or in a branch if you're a company.

 

To simplify your bookkeeping, choose a service that integrates with any small business accounting system you use. And for your invoices, if you’re a Westpac online customer with an eligible business transaction account1, you can use our complimentary Biz Invoice invoicing tool. It lets you create an invoice template, then generate, email and manage invoices from your smartphone, tablet or PC.

What are the advantages of a business credit card?

Business credit cards3 could be a useful way to manage and reconcile business purchases, and any interest free periods offered may help with your cash flow. Additionally, business expenses paid using some credit cards can earn rewards points, which can be spent on things such as gift vouchers, travel and merchandise.

 

Fees and charges may apply, so it's best to compare the options available and choose the business credit card that matches your needs.

How can I accept payments for my business?

Business banking offers a number of payment solutions for businesses, but the smart way to get paid faster is to give your customers the simplest possible way to pay. This could be through bank transfers or other types of online payment, or EFTPOS3 if you're operating a shop, café or restaurant.

 

If you use Biz Invoice, your online invoices will feature your bank account details for direct transfers, plus a BPAY® number if you are eligible2 to choose this option – which allows you to accept credit card payments for a fee.

 

Things to consider include any applicable fees, plus the process for moving payments into your business transaction account – always remembering that the sooner you have access to customer payments, the healthier your cash flow will be.

What should I do with surplus cash?

Even if it's just for short periods, it may be worth moving money into a savings account3 to gain extra interest, when compared to non-interest earning transaction accounts. This could also be a good way to set aside funds required for future payments, such as your quarterly BAS submissions.

 

Some savings accounts are free to set up and maintain, so you could open a number to keep your funds segregated for different purposes. Moving funds between accounts is quick and simple through online banking.

 

If you want the certainty of a fixed rate (rather than a variable savings account rate) and are happy to lock your money away for a specific period, a term deposit may be the way to go. If you already have a Westpac transaction account, a business term deposit3 can be set up through online banking, without the need to visit a branch.

 

With so many options to consider, it’s useful to have access to people who know your business and track record. Therefore, it pays to establish and maintain a good working relationship with your business bank, to help support your business.


Read more

4 reasons why you might need a business credit card

Using a personal credit card for business could be good in the short term, but may be tough at tax time.

6 reasons why you need a savings account for your business

We share the benefits of setting up a savings account for your business.

4 reasons to separate business banking from personal

One of the most useful things you can do when starting a business, is to keep your business finances separate from your personal.

Things you should know

1. To be eligible for Biz Invoice you must hold a Business One Low Plan or Business One High Plan account and be registered for Westpac Live Online Banking.

 

2. To be eligible to set up BPAY Payments with Biz Invoice you must be registered for Westpac Live Online Banking and be a Sole Trader who is the sole owner of the Westpac Business One Low Plan or Business One High Plan account to which Biz Invoice is linked. A $150 set up fee may apply and each BPAY® transaction will incur a transaction fee. Read full details at westpac.com.au/bizinvoice before deciding if this is appropriate for you.

 

3. Westpac’s products are subject to terms, conditions, fees and charges; and certain criteria may apply. Before making a decision, read the disclosure documents for your selected product or service, including the Product Disclosure Statement and T&Cs for Westpac business bank accounts, business credit cards, merchant services, business savings accounts and online banking, by clicking the above links; and consider if the product is right for you.

 

The information in this article is general in nature and does not take your objectives, financial situation or needs into account. Consider its appropriateness to these factors; and we recommend you seek independent professional advice about your specific circumstances before making any decisions.

 

BPAY® is a registered trademark of BPAY Pty Limited ABN 69 079 137 518