Small Business Bank Accounts Discussion Area

artist2011

I run a small business (limited company) but I have a bad credit score due to the fact that the Halifax pulled an overdraft facility when I was overdrawn and left me with an unauthorised overdraft, interest charges and charges for returned direct debits.I am trying to start another business as a sole trader but am finding it impossible to open an new bank account to service this business. I have thought about registering as a limited company, but again run into the credit score problem, as it appears banks do not separate ltd companies from individuals any more. Does anyone have any bright ideas as to how I can open an account in which to deposit funds generated by this business? I have spoken to two business managers from two different high street banks but have been given no help.

tonycheeseman

Does any know the cheapest way to accept credit & debit payments for our business? It would only be small useage at first! But they all look very expensive! Thanks.

silicondale

I am managing accounts for two companies, and looking for new banks for both. Neither needs an overdraft facility.

The first, currently at an ordinary branch account with Clydesdale, has around £3K in credit, but less than 5 small transactions per year - the company is almost dormant. So far, have had only occasional and small charges, but new monthly charging from July means a continuous drain on the account. I need to move it. Possibly to a savings account and not have a cheque account at all. Thoughts?

The second is with Santander/A&L Commercial and normallly between £1K and £20K in credit. Until recently was fairly happy, though monthly £5 charge is annoying. The online service is messy, but that isn't the main problem. Two weeks ago I had a business trip to Russia. I phoned A&L before I left to make sure the VISA debit card would be usable on the trip for hotel bills etc. I was assured that this would be no problem and my travel plans were recorded. I made doubly sure by putting it in writing in an online message. While away for 10 days, my card was rejected all 4 times I tried to use it. Indeed the first rejection was by a railway ticket machine in the UK before I left. While away I contacted the bank several times through their online messaging, and eventually got a reply to assure me the card had been unblocked and could be used. Needless to say it wasn't and couldn't when I needed to pay a hotel bill the very next day. Phoned after I got back and was given the highly implausible (but all too believable) story that when I had tried to top up my Asda Mobile PAYG phone account before the trip, the card was blocked as ASDA was listed as a retailer in their system, not a phone provider. They said they had left a phone message for me to resolve this - but I never got the message as they had used the wrong number (indeed a number that meant nothing at all to me). Agreed £45 compensation - not yet received - for the inconvenience but no way do I want to stay with Santander. This company needs a cheque acount. What about FSB/Co-op ? Or are there others that I should also consider?

Savvy_Sue

tonycheeseman wrote: »

Does any know the cheapest way to accept credit & debit payments for our business? It would only be small useage at first! But they all look very expensive! Thanks.

Sorry have only just noticed this: would usually have responded earlier to welcome you to the boards.

However, can only repeat what I say at regular intervals: first you need to be clear about what you need - do you need a counter service to withdraw or pay in cash? If you do, then which banks can provide this in a convenient way, and what do they each charge? Bear in mind that some will allow you to use counter services at the Post Office.

If you don't need counter services, you have a wider choice.

Either way, you then work out what your debits and credits are going to be like. If cheques cost more than BACS, can you do the majority of your payments by BACS? Ditto if paying in cheques costs more than BACS.

Then you look at what each bank is likely to charge for YOUR needs. Several offer free banking for the first year / 18 months. If you're a member of the FSB then I believe you can get free banking with the Coop, possibly with a rebate which half covers your membership.

And so on.

The article which started this thread is of course worth a look. But it is difficult for anyone else to say what will suit you, because your needs may not be the same as theirs.

Having said that, I've yet to hear a completely positive comment on Santander in this thread!

silicondale wrote: »

The first, currently at an ordinary branch account with Clydesdale, has around £3K in credit, but less than 5 small transactions per year - the company is almost dormant. So far, have had only occasional and small charges, but new monthly charging from July means a continuous drain on the account. I need to move it. Possibly to a savings account and not have a cheque account at all. Thoughts?

Can't give any concrete recommendations, but I'd have thought online banking would be the way to go, savings or not. Not sure who offers such a service for a business - I can name the usual suspects for charity / not for profit accounts but presume that's not appropriate here.

silicondale wrote: »

no way do I want to stay with Santander.

As I was saying ...

silicondale wrote: »

This company needs a cheque acount. What about FSB/Co-op ? Or are there others that I should also consider?

I think people are generally OK with the FSB Coop account, if it meets your needs. Through work I have a Coop Visa card (we don't bank with them, but they provide the Visa cards for our charity's bank), and any problems have always been swiftly resolved. Although to be fair, we don't use our cards abroad! When there was some suspected fraudulent use we were contacted VERY quickly and it was all sorted out without fuss.

silicondale

Thanks for the answer. I didn't notice any big delay! As you say, savvy_Sue - all depends on needs. I never have cash deposit transactions, and occasional cash withdrawal should be catered for entirely by debit card. Because turnover is small, even the £3 - 5 monthly charges that seems to be common are a proportionately high burden. Apart from FSB/Co-op there doesn't seem to be any business account that offers permanent free-in-credit banking, and the net cost of FSB membership works out similar to the total charges from some of the banks. Yes, I understand there are other potential benefits from FSB, but just like retail marketing, if I haven't felt the lack of the service so far, why wold I want to start paying for it? All I'm looking for is a fairly basic cheque account for company 2. For company 1 it's even simpler, would be happy with a basic savings account, no need for cheques, though a debit card would be useful for occasional use.

For both companies, something like the Nationwide personal 'Flexi' account would be ideal, but Nationwide don't offer any business accounts at all now.

Slinky

silicondale wrote: »

I am managing accounts for two companies, and looking for new banks for both. Neither needs an overdraft facility.

The first, currently at an ordinary branch account with Clydesdale, has around £3K in credit, but less than 5 small transactions per year - the company is almost dormant. So far, have had only occasional and small charges, but new monthly charging from July means a continuous drain on the account. I need to move it. Possibly to a savings account and not have a cheque account at all. Thoughts?

The second is with Santander/A&L Commercial and normallly between £1K and £20K in credit. Until recently was fairly happy, though monthly £5 charge is annoying. The online service is messy, but that isn't the main problem. Two weeks ago I had a business trip to Russia. I phoned A&L before I left to make sure the VISA debit card would be usable on the trip for hotel bills etc. I was assured that this would be no problem and my travel plans were recorded. I made doubly sure by putting it in writing in an online message. While away for 10 days, my card was rejected all 4 times I tried to use it. Indeed the first rejection was by a railway ticket machine in the UK before I left. While away I contacted the bank several times through their online messaging, and eventually got a reply to assure me the card had been unblocked and could be used. Needless to say it wasn't and couldn't when I needed to pay a hotel bill the very next day. Phoned after I got back and was given the highly implausible (but all too believable) story that when I had tried to top up my Asda Mobile PAYG phone account before the trip, the card was blocked as ASDA was listed as a retailer in their system, not a phone provider. They said they had left a phone message for me to resolve this - but I never got the message as they had used the wrong number (indeed a number that meant nothing at all to me). Agreed £45 compensation - not yet received - for the inconvenience but no way do I want to stay with Santander. This company needs a cheque acount. What about FSB/Co-op ? Or are there others that I should also consider?

For the first, the Saffron Building Society may have something suitable

http://www.saffronbs.co.uk/savings/Business-Savings-Accounts

silicondale

Slinky wrote: »

For the first, the Saffron Building Society may have something suitable

Many thanks. I was considering this one. The only problem seems to be that they expect the company also to have a current account, so it doesn't actually solve the problem. If it has a current account, this needs to be fee-free, and company #1 is not in a position to take advantage of any of the FSB services so even the FSB/Co-op deal isn't suitable.

Slinky

silicondale wrote: »

Many thanks. I was considering this one. The only problem seems to be that they expect the company also to have a current account, so it doesn't actually solve the problem. If it has a current account, this needs to be fee-free, and company #1 is not in a position to take advantage of any of the FSB services so even the FSB/Co-op deal isn't suitable.

I only have a savings account with Saffron for my Ltd company.

gloucesteroldspot

I've just read through this thread looking for banking answers for my wife who runs a small business. She started out with Alliance and Leicester's free business banking, which was OK, but since the transfer to Santander it has (surprise surprise) been a disaster.

The lack of references frequently mentioned here is a particular problem - although interestingly they have been leading her to believe that this is a technical problem that they are still trying to solve. Others here suggest that it's a policy decision. I am coming round to the view that they will actually say anything to get you off their back.

The much vaunted 'advantage' mentioned here of being able to pay in cheques and cash at the ATM is meaningless to us - the ATM is nearly always broken and we have to go to the post office 100 yards up the road. It's an old Alliance and Leicester branch so I guess they are just waiting for a break in the lease to close it down and can't be bothered to fix anything.

Worse still has been the bank telling her customers that they cannot pay into her account by standing order. She set up a meeting with the bank's local small business adviser to discuss this, but they never turned up, never rang back and subsequently avoided calls.

Another recent bit of nonsense that had us laughing was when, following a complaint about the amount of time taken to effect a bacs transfer out, she was told that ' there are regulations they have to follow about the minimum time that must be taken over an interbank transfer'. How's that for flying in the face of all attempts to make the banking system fairer and more efficient?

How can a bank be this chaotic? How can it survive if it is? It must surely be a reflection at street level of chaos in management right at the top.

Anyway, I didn't really come on here simply to moan about Santander, although it's difficult to stop once you get going, but rather to say thanks to those who have shared their experiences of getting a decent inexpensive banking service that meets the needs of small businesses. It's obviously very difficult. If the current government really wanted to help small businesses then addressing this mess would be a good way of doing so. I hope it's something that Martin can bring up in his scheduled meeting with the Treasury Minister.

cottager

Standing in the Natwest queue yesterday I saw a poster for 2 years' free business banking -- may have been there a while but I hadn't noticed it before. Don't know if it could be of interest to anyone, but found the relevant details here:
http://www.natwest.com/business/starting-a-business/two-years-free-banking.ashx
It's for startups, in business for less than a year.