Can’t open business account- advise please

DGDG

Hi,
husband and I have a Ltd company, 50/50 owners. Financial industry but not regulated activity, very straightforward business purpose registered with companies house. We now finally have a £50k payment on its way from a deal with an FCA regulated company but we are unable to open a business account. Starling and Barclays both recently turned us down; Metro turned us down in 2022. We don’t know why, I can only assume it’s because husband has credit card debt since being laid off during Covid (he is in full time employment now and we run this on the side, his employer knows and approves).

We are trying to rebuild our finances but it’s taking time. 

As things stand we don’t seem to be able to accept payment for our one successful deal! If anyone has any advice I’d be so appreciative, because I don’t know where to turn next.

Hoenir

Nat West, HSBC or LLoyds.  

DGDG

Every time we apply they make another credit check which affects us your score negatively so we don’t want to just randomly apply, unless we have a reason to believe we can achieve a better outcome. Clearly we have to change something about our application/the company/ourselves, I just don’t know what

DGDG

Hoenir said:

Nat West, HSBC or LLoyds.  

thanks - are they known for being more helpful than other banks? We are Barclays customers since 20 years and that didn’t help. 

PloughmansLunch

Have you looked at Tide or Mettle or similar app-based business accounts? They should be pretty quick to set up. I used the former for an incoming payment (and there was no hard credit check).

eskbanker

DGDG said:

Every time we apply they make another credit check which affects us your score negatively so we don’t want to just randomly apply, unless we have a reason to believe we can achieve a better outcome. Clearly we have to change something about our application/the company/ourselves, I just don’t know what

Have you both checked your credit files with all the agencies, to verify that everything there is factually correct?

MattMattMattUK

At what stage were you declined? Opening a business account is a lot more complicated than it used to be, you individually will need to be able to be verified as directors as well as the business properly matching, for me that has meant full Know Your Customer stuff, so showing passports, certificate of incorporation as well as the address matching the registered office. For me (and other directors where they exist for those companies) that meant that they needed to be able to verify us via the CRA they were using and we had to be on the electoral roll as well (already were). The searches on our personal files were also soft searches to not visible by other lenders. Finally, ignore your credit score, it is a made up and entirely meaningless number. 

DGDG

Thanks @PloughmansLunch will try Tide

@eskbanker everything is correct but obviously not looking great these days, trying to rebuild our lives

I wonder if I should resign as director so it’s just my husband on the application. I am a stay at home mother so am not contributing financially to the household, could I be the main liability here? 

DGDG

Call credit equifax and Experian are the ones we have checked with, I think that’s the main ones?

DGDG

…unrelated to this query but if anyone happens to have any advice for what to do with the incoming payment if we can’t open a business account with anyone, I’d be so interested to hear it. The contract is with our company so they can’t just pay the fee to our personal accounts, correct? 

lr1277

The following might not be applicable in your situation, but I post it on the basis of forewarned is forearmed.

2-3 years ago, a business came on this site looking for an alternative to Tide. This was because said business had received a grant, and the grant providing body stipulated that any bank the grant was paid into must have FSCS protection. At the time Tide did not have FSCS protection.

Now I don't know if Tide now has FSCS protection. And I can't remember how that situation was solved.

But I note that you said your client is FCA regulated so make sure there are no stipulations/caveats that might trip you up.

Additionally:

I use the site finder.com to find various financial products. You can search finder for business current accounts. On google I typed in:

Finder business current account

Many results are returned but I don't know how many would be suitable in your situation.

I also don't know how your company will be paid. Cheque perhaps? A couple of years ago the care agency looking after my dad used Cashplus business account (now called something else) and they did not take cheques. The other problem was at the time they were not on Confirmation of Payee. This caused my mum a load of problem paying them as she had to go into branch to authorise setting up the payee and the 1st transaction. The transaction failed when done on Nationwide's website until the payee was authorised in branch.