Small Business Bank Accounts Discussion Area

Savvy_Sue

Deleriad wrote: »

Well she wouldn't be accepting cards for purchases under £5 but she has worked in retail for about 25 years and I very much doubt that the money you save by refusing cards is going to make up for the customers you turn away.

This place has recently changed hands, so maybe they haven't yet got their card side set up yet, you certainly need to shop around to avoid paying over the odds as far as I can see. Just thought it was worth mentioning.

Also I'm used to seeing no cards for under £10, and quite accepting of that: I never used to offer a card to a small biz for less than £5 anyway, being conscious of the costs, but now tend to offer cash for up to £10.

Deleriad wrote: »

BTW did find the article on MSE about small business banking after posting the above. The consensus seems to be that there is no such thing as a bank with a good customer service.

:rotfl: I always say you should think about the services you need, and then find where you can get them, and then see how little you can pay for them.

Your OH needs to be able to pay cash in. She may sometimes want to withdraw cash, and may sometimes want that cash in coins. On that basis, she needs to be able to do it reasonably locally. So, who is local, and what do they offer, and what do they charge? If there is a PO nearby, some banks will let you do some transactions at the PO, so bear that in mind.

I live and work in a bank free zone, but there is a PO fairly close to both, so I'd always want to use that rather than have a 2 mile hike to the bank!

zozitufnell

FrugalTopCat wrote: »

I'm thinking that going for either the NatWest or Lloyds options may be right for me:

• I'm planning to set up as sole trader from next month
• freelance copywriter/marketing consultant
• low start-up costs which I can finance myself
• relatively few transactions per month (if I can make it work!)
• prospective customers are marketing agencies (subcontracting work to me as a freelance) and small-to-medium sized businesses
• therefore I would expect to invoice clients and be paid either by BACS or cheque
• I wouldn't be seeking loan or overdraft facilities

Given the above details, am I right in thinking that one of the above named high street banks would be more appropriate to my needs? (after reading some of the feedback earlier in the thread that it's hard to track individual transactions with Santander's account). I realise that the downside is that I will have to shop around again after 18 months/two years if I want to avoid charges.

Thanks for any up-to-date feedback!

I'm in exactly the same position - starting my business from home, no real expenses, half my customers are overseas agencies who will transfer money directly into my bank account, the other half are private individuals here who I would transfer money directly to as well, so I don't need a branch at all. But what I do need is a good bank internet account, and not too pay too much in charges as my account will usually have lots of money in it.

I've also read here about Santander's lack of identification on transfers, which was very important, so thanks to those who pointed it up. I used to be a happy Abbey (personal banking) customer until Santander took over, whereupon the service became dire, and am very happy with Halifax now.

I did try to open a Santander business bank account over the phone in the past month. For my own reasons I didn't want to open it over the phone, but wanted to make an appointment at the branch. First call: we have no trace of your branch (it's a branch on the A1 in London has been there at least 20 years), second call: no-one at the branch is answering the phone; third call: the business advisor is on holiday and will get back to you when she returns - three weeks later and no call back.

So I'm also thinking of Natwest or Lloyds, though I've just read on this forum that Natwest customers may be sort of transferred to Santander - I really don't want to bank with them again. You get what you pay for, my mum always says, and I think it's true with their free banking.

But there doesn't seem to be a 'good' business bank............

Paulgonnabedebtfree

zozitufnell wrote: »

I'm in exactly the same position - starting my business from home, no real expenses, half my customers are overseas agencies who will transfer money directly into my bank account, the other half are private individuals here who I would transfer money directly to as well, so I don't need a branch at all. But what I do need is a good bank internet account, and not too pay too much in charges as my account will usually have lots of money in it.

I've also read here about Santander's lack of identification on transfers, which was very important, so thanks to those who pointed it up. I used to be a happy Abbey (personal banking) customer until Santander took over, whereupon the service became dire, and am very happy with Halifax now.

I did try to open a Santander business bank account over the phone in the past month. For my own reasons I didn't want to open it over the phone, but wanted to make an appointment at the branch. First call: we have no trace of your branch (it's a branch on the A1 in London has been there at least 20 years), second call: no-one at the branch is answering the phone; third call: the business advisor is on holiday and will get back to you when she returns - three weeks later and no call back.

So I'm also thinking of Natwest or Lloyds, though I've just read on this forum that Natwest customers may be sort of transferred to Santander - I really don't want to bank with them again. You get what you pay for, my mum always says, and I think it's true with their free banking.

But there doesn't seem to be a 'good' business bank............

It was probably me that mentioned the lack of info supplied by Santander on incoming bank transfers. Even if they started supplying the info again (they used to do it then stopped), I cannot trust them to change such an important item without warning.
Santander do supply the name of the payer (or the name of the business), the type of transfer (e.g bank giro credit/faster payment etc.), and the amount. This may be sufficient for many businesses. It wasn't sufficient for me because most of my work is relatively small transactions for private householders (I clean their windows). This means that there is a lot of replication of surnames and amounts. Therefore I supplied them with a reference to quote as <housenumber/1st 4 letters of housename>+<postcode>. Santander showed this info then suddenly stopped without warning. It left me struggling to know who had paid me in some cases.

Although some on here have knocked Co-op Bank, I do wonder if they may be suitable for you - particularly as you run your business from home.

If you join the FSB (Federation of Small Businesses), one of the benefits is a free business account with the Co-op. You can use your local post office for any rare occasions you may need to deposit cash or cheques. One benefit of being in the FSB is that you get help if the taxman ever wants to investigate. This can otherwise be a costly process even if proven totally innocent of any wrongdoing.

Assuming you are a sole trader, the annual fee for being an FSB member is £100 (c. £150 for the first year). However, the fee is tax deductible. On top of this the Co-op give you £25 a year bonus for banking with them.
So, the effective membership fee (after year one) is about £70 (assuming basic rate tax and NI) minus the £25 bonus which brings it to £45 a year. If you were to look around for anti-investigation insurance, that alone would cost you a lot more.

BTW. Co-op DO show the incoming BACS references.
I'm in the ludicrous position of using two accounts for one business.
I have the Co-op for receiving bank transfers. I still have Santander for depositing cash and cheques. This is because I live near a branch and can do this free 24/7 via the ATM.
What a palaver - but this does actually work for me.
Hope this info issome help to you.
I've not tried business accounts at any bank other than the two I've mentioned. It may well be that you can do better elsewhere.

zozitufnell

Thanks for that, and yes, like you, I will (hopefully) have numerous payments from the same company of the same amount but for different sales, so I do need to have the bank transfer have some sort of reference. But the mere fact that Santander acts like it does, ie change things without warning, is enough to put me off. Their customer service is so awful I really don't want to give them my money!

zozitufnell

Oh, and last year I opened a bank account with the Coop for a campaign I was involved in, as a joint signatory. They made us jump through so many hoops, and were so inefficient that it has really put me off banking with them. It wasn't the opening of the account that was the problem, but any time we had to do anything like change a signatory due to people leaving the campaign we had to fill out exactly the same form as to open the account and get everyone, even the leaving signatory, to sign all over again, fill in all the same details, it was far too complicated and lengthy. And then they took forever to do anything.

zozitufnell

I don't know if anyone is still reading these posts, but I have a question I wonder if anyone could help me with.

I've just spoken to HSBC about having my own invoice number shown attached to any payment I will receive from abroad into my business internet bank account so that I can see not only who it's from but which invoice they are paying. Not only do they not do this, but if I get a payment from Europe I won't be able to find out any details about it until they send me the details BY POST!! I will be able to telephone them when it gets in to find out these details, but I hardly want to do that when the essence of the business is getting money transferred in from Europe all the time.

Does anyone know if this is usual? Do other banks do this? By post in 2011!!

Paulgonnabedebtfree

zozitufnell wrote: »

I don't know if anyone is still reading these posts, but I have a question I wonder if anyone could help me with.

I've just spoken to HSBC about having my own invoice number shown attached to any payment I will receive from abroad into my business internet bank account so that I can see not only who it's from but which invoice they are paying. Not only do they not do this, but if I get a payment from Europe I won't be able to find out any details about it until they send me the details BY POST!! I will be able to telephone them when it gets in to find out these details, but I hardly want to do that when the essence of the business is getting money transferred in from Europe all the time.

Does anyone know if this is usual? Do other banks do this? By post in 2011!!

I don't know about the rest of your question re posting paperwork but I have encountered issues re invoice numbers.
Generally, bank transfer payments should only need to be set up once with the sort code, acc no. etc and any reference that you ask the customer to supply. Presumably you would want the customer reference to be the invoice number. However, I know that some banks would require the whole payment to be set up again if there was only one slight alteration. If you think about it, this part may be reasonable as an alteration could be an indication of a hacked account - the bank probably having to make up any losses.
However, I see no reason why they wouldn't show the sending companies' names. Then perhaps the amounts would enable you to deduce the invoice number. Alternatively, could this not be done by email? i.e. the company sends you an email informing you of the payment and the invoice number so that you can check it off on your account.

surfing-mtber

See my full thread under Small Biz and Charities section for advice on how to beat the indifference and greed of at least one high street bank.

Ask any questions.

Beewee_2

Does a sole trader need a business account or can they just use a separate current account to the one they use for personal finances?

Paulgonnabedebtfree

Beewee wrote: »

Does a sole trader need a business account or can they just use a separate current account to the one they use for personal finances?

As far as I know it's not a legal requirement to have a business account. However, if your bank notices and realises what you're doing, they may get a bit stroppy and try to force you onto a business account and charging you (though they may have free startup deals). The people you might need to be concerned about are HMRC. Even though you may be scruplously honest, you need to be able to show that. So if you do go down this route, make sure it's all trackable - just in case they ever want to take a look.