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Banking for my business

Managing your money and cash flow is core to your business success and the right business bank account and business services contribute to this, so it’s important that what you choose matches your needs.

Business banking - 101

3 basics to consider:

1. A transaction account

When choosing a transaction account, consider all the transactions you may use. For example, you need to factor in how you will receive and make payments. 

You may also need merchant facilities, so you can take payments from your customers.

Once you know what you need, then look for an account that offers you the most cost effective fees given that usage. Many business accounts offer options so you only pay for the service you require.

Investigate the pros and cons of keeping money in your transaction account and moving some of it into a savings or investment account where it could earn interest and work harder for you. It may be possible for you to link your accounts so transferring between them is easy.

2. A business credit card or debit card?

A business credit card could be useful for short-term cash advances and to cover short-term expenses. Research any fees or charges and interest rates that may apply. Credit criteria will apply to the approval of a business credit card.

A debit card linked to your business transaction account lets you access your own money instead of using credit. However, fees and charges may apply depending on the transactions it’s used for.

3. Overdraft

An overdraft is a rolling line-of-credit that can assist managing the highs and lows of cashflows. Credit criteria apply to the approval of an overdraft. Larger sized overdrafts may need to be secured by residential or commercial property. Compare the interest rates, conditions and fees that apply to overdrafts from particular providers.

FYI: It may be easier and more cost-effective to use the same bank for all of your business banking.

Business banking tips

  • Keep it separate

If you’re a small business, keep your business bank account separate from your personal account. It makes tracking money much clearer and good record keeping is recommended by the Australian Tax Office (ATO).

  • Get mobile

The flexibility of digital and mobile banking to check your accounts for payments, transfer funds, or pay for something you need is essential, especially if you travel for business.

  • Avoid the BAS shocks

Use a separate account to put all your GST tax money into - setting it aside will spare you the quarterly BAS shocks. Or consider putting this money aside in a separate account. Ask your banker  if an offset account is an option worth considering.

  • Fees and relationships

Fees and interest rates are important considerations when choosing your business bank accounts. So is the long-term relationship you have with your bank.

If you want to grow your business, invest in new equipment or take it in a new direction, it’s useful to have experts and advisers who know your business and business track record. Setting up a good relationship with your business bank is a good way of supporting your business.

 

Things you should know

Deposit Accounts for Business Customers Terms and Conditions (PDF 514kb) (PDF 520KB)

To be eligible to apply for Business One – Low Plan, your business must be registered in Australia.

General advice: This information is general only and does not constitute any recommendation or advice. It is current at the time of publication, and is subject to change. It has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on the information, consider its appropriateness, having regard to these matters. Consider obtaining personalised advice from a professional financial adviser and your accountant before making any financial decisions in relation to the matters discussed in this document, including when considering the finance options for your business.