Fee Free Banking Accounts for UK Businesses

Although there is no legal requirement, all newly formed UK companies should separate personal and business transactions in their bank accounts. Various introductory products are available from the big high street banks for start-up enterprises and incentives for existing businesses switching their account. The most popular services are shown below.

Comparison Between the Popular Accounts

ProviderKey InformationStart-ups
free period
SwitchersMore Details
Barclays
  • CreditFocus classic bad debt manager.
  • Marketing training seminars.
  • 2GB of i-sure data backup.
  • Barclays Connector online community.
24 0  
Lloyds
  • Sage Planning system.
  • 90 day trail of Sage Accounting.
  • Relationship Manager support.
  • Over 350,000 customers.
18 6  
Santander
  • Access to Post Office branches.
  • Local branch manager.
  • Online help and tutorials.
  • Credit/ debit card terminals.
12 0  
HSBC
  • Access to knowledge centre tools & guides.
  • 1,000 high street branch network.
  • UK based call centres.
  • Dedicated relationship managers.
18 6  
RBS
  • 2 months insurance.
  • Regus Businessworld.
  • £500 Overdraft.
  • No annual fee credit card.
24 0  
Cooperative
  • Access to Post Office Network.
  • Interest on balances over £1,000.
  • Overdraft and lending facilities.
  • FSB option is free for life.
18 18  

All of the banks also offer additional services to help manage your day to day transactions, including:

  • Telephone banking.
  • Internet access.
  • Overdraft facilities.
  • Yearly account reviews.

(*) After the two year period, you're placed on the automated debit and credit tariff. Manual entries such as cash deposits in branch have additional charges. All automated transactions such as standing orders, direct debits and credits remain outside of the charging structure.

summary of charges

New accounts can be opened online directly via their website, via their customer service centre or over the telephone. Fees could be charged for services outside of normal automated transactions, such as cash deposits and stopped cheques. Please check directly for their terms and conditions.

If you've large credit balances, a money manager or deposit account could earn additional interest. These are discussed here although rates are still at historic lows.

What Flexibility do You Require to Manage Your Financial Transactions?

If you're a high street shop and need to make regular cash deposits, you'll want a bank with a branch network near you. Most of the major banks offer this service and some use the extensive Post Office branch system. You're able to deposit cash if you're with the Bank of Ireland, Barclays, Clydesdale Bank, Halifax, Lloyds TSB, Santander and the Cooperative Bank. You can also withdraw cash for those banks and with HSBC, Ulster Bank, RBS, Natwest, Nationwide and Bank of Scotland.

When deciding which is suitable to your circumstances, ask yourself the following questions:

  • Do I need access to a local branch?
  • Will I require an overdraft facility?
  • Have I large deposits that need a high rate of interest?
  • Will I grow my business and need access to loans?
  • What volume of transactions will I process which may attract a charge?

If you have a low turnover, or simply require an account to pay bills and receive payment for invoices, then Barclays Bank is the recommended option.