Online banking makes sense for most individuals, but it also makes sense for many small businesses. Online banks offer all the services of a local bank including credit lines, term loans, savings accounts, and checking accounts, but they also offer a better interface to run monthly, quarterly, or yearly finance reports, as well as other additional features. Unlike individual accounts where a person uses their social security number as a reference, businesses can be owned and managed by many people, and as such, banks often require incorporation documents, as well as written verification of corporate tax ID. This is in addition to long application. These measures are in place to ensure that fraudulent accounts are not created. The process of setting up an account may take up to a week, but the benefits in the long term outweigh the difficult application process. Many banks claim to offer online business banking, but most just let you transfer funds between accounts, view balances, and order checks. Because there is a distinction, it is important to understand what services are offered before signing up.

If you are a small business owner with few employees, it might be best to open an individual account and try out online banking for several months before taking your business finances online. All businesses should maintain a physical bank until you have absolute confidence in your online bank.

We encourage all those interested in setting up an account with an online bank to follow the steps in our choosing an online bank section. Note that most banks that offer online banking, don't offer online business banking, so we have listed some of the banks that do offer full service online business banking below.

You should consider applying for a business credit card. Not only will it provide you with a more convient way to make purchases, but it can help you keep your business expenses seperate and accessable when it is time to do your taxes at the end of the year. The best business credit cards are available from Advanta. Even if you are a new small business, they have a card for you. Click here for more information or to apply online for an Advanta Business credit card.