Changing Business Banks: What You Absolutely Must Know

By Lindsey Stefanka

Founder & Content Strategist, Mind My Content

As a business owner, switching to a new banking service can feel tedious—after all, there are much bigger tasks on your plate. From researching different banks to importing your automated expenses, each step of the transition can make you want to quit before even starting. But considering how much the right banking platform can transform your business finances, it may be time to say goodbye to your old bank. 👋

Transitioning your current expenses is a critical part of changing business banks. That’s why it’s essential to know the signs that you need to change your bank and the steps you can take to ensure there’s no disruption to your automatic payments. 

Read on to learn if now’s the right time to change business banks, the advantages of doing so and the simple steps you can take to make the switch. 


Signs you need to change bank accounts ⚠

One of the most challenging steps in changing business banks isn’t switching — it’s knowing when to do so. As a business owner, you’re likely busy executing multiple initiatives at once, and it’s only when you run into issues with your bank that you decide to look into other options. 

Because of this, it’s worth looking out for common signs that it’s time to switch, so you can get ahead of any issues before they arise. Let’s take a look at some of the common culprits.

You need more banking services

One of the most frequent complaints we hear from business owners is that their current bank doesn’t offer the services they want. But what are these important services? The right business banking platform will make your finances easier for you. Yes, you heard that right! You don’t need anything slowing you down on your way to the top—especially an outdated bank. 

Necessary bank services include organized cash and expenses, dedicated bank accounts, cards  💳 and team spending limits, to name a few. 

You’re paying a lot in fees

Small fees here and there may sound like a necessary evil, but they can stack up before you know it. 💰And we know that every expense matters when building a business. It’s frustrating, to say the least, when you find a hidden charge or recurring monthly fee. Many banks also have minimum balance requirements, forcing you to always keep a certain amount of money in your account. This can cause a real strain on small businesses and hinder growth, especially if you’re trying to open multiple checking accounts and manage cash using digital envelope budgeting

The right banking solution won’t charge you extra fees. We’re talking about no account overdraft or withdrawal fees. We know what you’re thinking, but it’s not too good to be true. If you’re experiencing these charges, it’s time to ditch the outdated way of banking. 

You have to visit a physical location

If you’re too busy to notice the hidden fees your current bank charges you, you’re certainly too busy to make a trip to a physical branch. Gone are the days when you have to make a withdrawal or get approval at a bank location. 🏦 Now, you can do everything you need as a business owner through an online platform. 

With flexible online banking, you can empower team members to pay bills, issue debit and credit cards and secure spending from anywhere at any time. 

Your bank can’t grow with your small business

With outdated services, your current bank could actually be hindering your growth. We’re talking about a disconnect between banking and accounting services, a limited number of accounts and fees that hijack your savings. 

The right business bank can grow with you, helping you at every step by giving you clarity and control of operating expenses, cash flow and accounts payable. 

You’re experiencing poor customer service

When it comes to your banking relationship, it can be frustrating to experience poor customer service time and time again. This is especially true considering you’re taking time out of your busy schedule to visit a branch location or schedule a call. 

Ultimately, it’s important that your bank provides hassle-free support to help you when you need it most. Whether you’re looking for a simple answer or need help tracking down a charge, the right bank should provide you with the customer service you deserve. 

How hard is it to switch banks?

One of the biggest misconceptions about switching banks is that the process is hard. But the reason you think that is due to your existing outdated banking systems. In reality, switching business banks is not hard and only takes about 10 minutes with a platform like Relay

The right online business banking platform should make the process easy for you. This includes offering a simple online onboarding process, outlining key account steps and ensuring your automatic payments are set up so you don’t experience disruptions. ✅

Keep in mind that different banks offer different services, benefits and fees. So one of the most challenging parts of the process is choosing the right banking experience for your needs. 

How to switch bank accounts ↔

If you’re ready to make the switch, we can help guide you through the process of switching bank accounts. When switching business banks, all you need to do is gather a few key documents to start the process.

1. Research your options

If you’re looking to switch banks, chances are you’re looking for something your old bank can’t provide. Consider the top services and features you’re looking for, like an online platform, expense categorization and multiple accounts, then research which banks will meet those needs.

When comparing different financial institutions, you should consider the features they offer and the fees and rates associated with the bank. A good bank should outline all costs, if any, ahead of time to ensure you don’t get blindsided with charges. Additionally, verifying that your new bank is an FDIC member is also a good idea to protect your money. In the event of a bank failure, this insures deposits up to $250,000.

2. Apply for an account

You’ve picked the right bank; now it’s time to apply for a new business account. Each bank offers a different application process, so it’s hard to say how exactly to do so. But with online banking platforms, you’ll be able to apply online at any time. 

The process should be fairly quick but will depend on the bank you choose. At Relay, the online application process takes less than 10 minutes from start to finish. 

3. Provide necessary documents

The documents needed to open a business bank depend on the type of business you own. In general, you’ll need to provide:

  • 🪪 Photo of Government-issued ID 

  • 🔢 Social Security Number (SSN) 

  • 🏠 Mailing Address

  • 📞 Phone Number

  • 📧 Email Address

For corporations and LLCs, you may need to provide additional information such as your EIN and Articles of Organization.

4. Identify all your incoming and outgoing payments

When setting up your new account, it’s important that you don’t forget to set up your recurring payments, both the ones you send out as well as any incoming deposits. Don’t close your current account until all recurring monthly expenses are posted to ensure there’s no delay in payments. 

While it may seem tedious to identify and update each recurring payment at the start, if your new banking platform offers recurring payment features, you stand to save a lot of time in the future. With Relay, for example, you can manage bill payments with multi-step approval workflows 🔀 and scheduled recurring payments directly from your account. Once you pay a bill, the transaction is auto-synced with accounting software integrations, like QuickBooks Online or Xero, for one-click reconciliation.

You wouldn’t want to miss out on any revenue, so it’s also essential you wait until all incoming payments are posted before closing your account. With a platform like Relay, you can rest easy knowing that we can request payee information, W-9 forms and securely store payee information for future use. Now that’s not your traditional banking service!

Your bank may also provide a “switch kit.” With a switch kit, the bank will notify providers and suppliers when you transfer automatic transactions. 

5. Close your old business checking account

Finally, it’s time to say adios to your old bank! Once you set up your new account, transition your accounts payable and all physical checks 📩on your old account have cleared, you can close your old account without looking back. 

You may be able to call to cancel your account, or you may have to go to a branch to submit a cancellation notice. Additionally, your bank may ask you to fill out certain forms for the account closure. The bank will then release the remaining funds after all transactions are processed.

What are the advantages and disadvantages of switching banks?

When considering if now’s the right time to switch business banks, weighing the pros and cons can help you make the right decision. While the process can be quick and hassle-free with the right bank, there are some drawbacks to consider beforehand. 

Pros of switching business banks: 💁

  • Take control of your cash with a smarter money management platform

  • Obtain more comprehensive banking services

  • Save money on fees and hidden charges

  • Ditch the visits to a branch location by choosing an online platform

  • Organize your cash and expenses into separate, single-purpose checking accounts

Cons of switching business banks: 🙅

  • Can take time to research the right bank

  • May disrupt automatic payments if not executed correctly

  • Requires you to learn how to use the new bank account system

  • Will require you to order and wait for new debit cards and checks

What should you do after switching banks?

Once you’ve switched bank accounts, all there’s left to do is get to know your new system. With an online banking platform, you can gain insight into your spending habits, auto-sync your accounting integrations like Quickbooks and categorize your expenses to manage your finances better. 

Ultimately, it may be worth switching banks if you're paying too much in fees and missing modern features like mobile banking, no-fee ATM withdrawals 🏧 and automated transaction data. At the end of the day, the choice to make the switch is up to you. Choosing a new bank can better meet your business needs and set your finances up for success.

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Additionally, the right bank will grow with your small business by offering areas for you to expand. This includes allowing you to open numerous accounts and providing a platform that understands your spending behaviors. 

If you’re ready to make the switch, consider the benefits of choosing Relay. Spend, save and plan more efficiently with unparalleled clarity into operating expenses, cash flow and accounts payable.

Make the switch to a Relay business bank account today.