Axos vs BlueVine — Which Online Checking Account Is Meant for Your Small Business?

Anyone who runs a small business will tell you that it is not easy. It is very time-consuming and requires a considerable amount of investment.

Updated 9/25/2023
**********************

My small business requires not only financial but also an emotional investment. They are interconnected! Managing everything solo is impossible. I need external support to keep my business turning like a well-oiled machine.

One particular part where I need the most help is in managing the finances. Staying on top of cash flow, payments, etc. is not an easy task.

This is where choosing the right bank and account comes into the picture. In this article, I will explain everything you need to know about small business banks, including a comparison between the top two banks on my list, namely Axos and BlueVine.

Do You Need a Business Checking Account?

If you are a budding entrepreneur who wants to take your business to new heights and make it your main source of income, then you are in need of a business checking account.

A business checking account allows you to separate your business-related transactions from your personal finances and create meticulous records of each transaction.

It is a solid addition to the financial setup of any small startup or business.

How Does a Business Checking Account Differ from a Personal Checking Account?

On the surface, personal and business checking accounts seemingly have no differences. However, there are certain features that come with business checking accounts that are not offered in personal accounts.

For instance, with a business checking account, you can get access to features like multiple debit cards for your employees, services to process payroll, etc.

A business checking account also has different requirements compared to a personal checking account. These differences are noticeable in the minimum deposit and minimum balance required, fees, etc.

Why Do You Need a Business Checking Account?

When you are running a business, having a separate record of your business finances makes sense for multiple reasons. Even as a side hustler, maintaining a separate checking account for your finances is a good idea.

Below are some of the key reasons why a business checking account may be beneficial to you.

Simplified Taxes

While legally, you are not required to have a business checking account from a tax standpoint, it is still considered a smart idea.

In fact, it is recommended to separate your finances as a small business owner. Mixing finances will create a muddle when it is tax season. You will have to spend hours organizing the finances to locate deductible expenses.

However, with a separate checking account for your business, you can greatly simplify the process of filing taxes. The entire process can be nipped accurately.

If you mingle your business transaction with your personal ones, then you are likely to get spotted in the eyes of the IRS, and you may get audited.

Efficient Accounting

A separate business checking account lightens the pressure of bookkeeping. You will get better insight into the performance of your business. It will also be easier for you to monitor cash flow across a dedicated account.

You can further streamline your accounting with integration tools. This makes it easier to handle payroll services, etc.

Liability Protection

With separate checking accounts, you can protect your personal assets from any liabilities associated with business assets. This is an advantage if, for instance, someone decides to sue.

Mixing both your business and personal finances is risky. It makes you vulnerable to liabilities. If someone attacks your business, it does not spell well for your personal assets since, to the outside eye, your business and personal assets are one entity.

A Stamp of Credibility

Opening a business checking account shows a professional side of your small business. Even if your small venture began as a hobby, you will add a touch of credibility to it when your payments are undertaken through an account stamped with the name of your business.

Additionally, your clients can pay you through credit cards if you have set up a business checking account. This is not possible as easily (or cheaply) through a personal account. Being able to accept all forms of payments shines a professional light on your business in addition to adding to your income.

Both these instances reflect in your taxes during an audit. While having a business checking account legitimizes your business, it does not automatically earn it a business status. You have to show profits for at least three years for your venture to classify as a business.

Besides adding credibility and a level of professionalism to your small business, maintaining a checking account for the venture shows legitimacy to the IRS.

Future Growth

Regardless of your plans to expand your business down the line, maintaining a checking account opens up your options for growth. For example, if you require funding like a business loan in the future, it will be easy for you to apply for one since your business has a stamp of legitimacy.

Whatever you intend for your business, a separate checking account ensures ease of management. It adds layers of professionalism, credibility, and legitimacy. It also protects your personal assets and gets you through tax season with ease.

How to Choose a Business Checking Account?

Before you dive into the world of business checking accounts, you should be aware of what to look for when choosing an account.

Various banks offer various benefits. They also come with certain limitations. You have to decide what matters to the financial health of your business before you opt for a checking account.

When weighing different checking accounts, consider the following points.

Online Access

Does the bank of your choice provide a business checking account with online access? There are online-only institutions that are excellent for small business owners who are comfortable with digital banking. They provide numerous benefits, including the ability to conduct business from anywhere at any time.

Interest

Some banks offer higher interest in their business checking accounts than others. This is mostly seen in online-only banks since these institutions forgo a physical location for added features at a lower cost and a higher benefit to you.

While you are not likely to get impressive returns on your funds, a high-yield interest will, at the most, cancel out any fees associated with the checking account.

Fee Structure

When choosing a business checking account, it is of the utmost importance to look into their fee structure. These vary vastly. While you will be levied minimal fees at one institution, another might charge you exorbitant fees for the same service.

Fortunately for you, most banking institutions that offer business checking accounts offer their basic services at negligible cost. You will find a lack of monthly fees, transaction fees, or other account fees, depending on the bank.

However, there are likely to be fees for using out-of-network ATM systems, foreign transactions, etc.

Minimum Requirements

Most banks have a minimum requirement for an in-account balance on a monthly or yearly basis. While some require a minimum deposit to open your account, others require you to maintain a certain balance moving forward.

If you are a small business that is barely making any profits, you have to look for checking accounts that offer minimal or no minimum balance or deposit requirements.

Transaction Limits

Banks have certain limitations, such as the number of transactions you can do per day or month. Once you use up all your fee-free transactions, you will be levied a certain fee to continue additional transactions.

Depending on your business, you have to ascertain if the transaction limits meet your goals and if the fee structure for crossing the limit is worth it.

Cash Deposits

Besides transaction limits, you also have to look into limits for cash deposits. Some business checking accounts in online institutions offer no cash deposit service. If your business does not operate in cash-only mode, then this does not affect you.

However, if you primarily have cash dealings, then you should look for an account that will offer cash deposits along with a sufficient limit for each billing term. The cost of crossing the limits can add up here as well. Therefore, you should be wary of such fees and decide if the expense helps your business.

Incentives

In addition to the above features, look for banks whose business checking accounts come with bundled services and perks.

This factor gets competitive across institutions. Therefore, you will have to look for incentives that make sense and benefit your small business. Such perks could include access to multiple debit cards, sign-up bonuses, a fee waiver with merchant services, etc.

Accessibility and Customer Care

Another thing you need to make certain of is that you have proper access to your funds. When opting for a business checking account, make sure that the bank offers a wide network of fee-free ATM networks for easy access to your money.

Besides accessibility, test their customer care service. Most conventional banks offer in-branch service during office hours. Some online banks, on the other hand, tend to have easy access to live support 24/7. Compare and contrast the availability of customer support before you finalize your decision.

Axos vs BlueVine — Which Ranks Higher?

As a budding entrepreneur myself, I have been on the hunt for the best possible banking solutions for my business. While it is grueling to wade through the vast market of choices, it is rewarding in the end when you land on the perfect choice.

In this section, I will guide you through the two choices that I explored — Axos and BlueVine.

Both these banking institutions are digital. They offer business-friendly services via an online platform rather than the conventional method.

About Axos

Axos Bank came into being in 2000 as Bank of Internet USA. It has since made a mark in the digital banking industry. While it initially only offered basic checking account features, it has since become a full-service digital bank. Currently, there are two types of business checking accounts under its umbrella of service.

Depending on your needs, you can opt for a basic business checking account or a business interest checking account. Both of these options are well-suited for owners of small businesses.

It offers various business banking solutions, lending options, and other products in its digital service.

Axos Bank is a leader in the online banking industry within the United States.

Pros

● You will find many account types for your business, including checking, savings, CD, and market accounts.

● Axos’s basic checking account has low deposit requirements and zero monthly maintenance fees.

● Axos customers enjoy unlimited reimbursements for ATM fees in the country.

● You can open a high-yield savings account with a minimum deposit of $250. You will not be charged monthly fees, nor are you required to maintain a minimum balance per month. The account also offers a free ATM card should you need it.

● The Essential Checking account does not charge any monthly, overdraft, or non-sufficient fund fees.

● You can earn up to 1.25% APY with the bank’s Rewards Checking account. It is a tiered-rate account with increasing interest rates depending on the fund availability in the account.

● First-time checking account openers get a welcome bonus.

● Customer care support is around the clock. You can reach out for help 24/7.

● Axos offers interest-bearing checking accounts designed for older individuals and young teenagers.

● An Axos Money Market account and a CashBack Checking account have no limit on check writing.

● Axos also offers a wide range of loans and lending solutions for your business.

● You can easily set up an account without hassle.

● You can gain overdraft protection for zero cost.

● It is ideal for those looking to conduct bank dealings for their business online.

Cons

● The Business Interest checking account requires you to maintain a balance of $5,000 a day. Failure to do so will incur a monthly maintenance fee of $10.

● Since it is a digital banking platform, there are no physical branch locations anywhere.

● It offers low APYs compared to other banking institutions.

● Compared to other online banking institutions, you are required to pay a higher minimum deposit when opening an account.

● Axos limits fee-free transactions to only 200 each month.

About BlueVine

BlueVine offers online banking solutions for small businesses. It took its place in the neobank world in 2013. Neobanks are online banks that combine technology and security to provide financial services similar to conventional banks.

It linked arms with The Bancorp Bank in 2019. Since then, BlueVine has been dedicated to providing small businesses with the required services to help them efficiently meet their financial goals. It offers credit lines, bill payment services, invoice factoring, and business checking accounts.

Pros

● BlueVine does not charge you any monthly maintenance fees, nor does it charge you any minimum balance fees.

● You do not have to worry about a minimum opening deposit when opening an account.

● There is no limit on the number of free transactions you can conduct.

● It adds a touch of old-school by offering two fee-free checkbooks and check-writing privileges.

● There is a vast network of fee-free ATMs.

● If your business meets the bank’s eligibility criteria, then you can access loans should you need them to further the growth of your business.

● It offers a high-yield checking account with 1.2% APY on balances below $100,000.

● There are multiple payment methods, including wire, check, and ACH.

● You can get your hands on a debit card through a checking account.

● Cash deposits are a possibility with BlueVine.

Axos vs BlueVine

Has the above section made a choice clear for you? The pros and cons should help narrow down the top pick of the two.

While both banking institutions serve small businesses like mine, they vary in the number and quality of services they provide.

Now that the basics have been covered, let’s do an overview of the important points that you should keep in mind before you land on a bank and sign up.

Of the top, my personal choice is BlueVine. If it is not clear why it is my top pick, then you will soon see. Let’s analyze Axos and BlueVine in further detail.

Services

A customer gauges the worthiness of a bank by the number of relevant services it provides. As someone who runs a small business, what are some services that are tied to your business’s financial support?

Of the two banks, Axos has more services than BlueVine. But BlueVine specializes in checking accounts AND services for business owners, whereas Axos has an array of different account types to choose from, depending on your need.

Would you rather trust your business checking to someone who specializes in this service, or someone that doesn’t specialize in anything and offers different accounts for Personal, Business, and more?

For me, the choice is easy in sticking with someone that focuses on small business needs.

Interest Rates

Online banks offer higher interest rates than conventional banks since their overhead costs are minimal. This feature is highly beneficial to business owners since it adds to their savings.

The APY rates for Axos vary depending on the type of account you choose. If you want to opt for the highest-yield checking account, then you should look into the Rewards Checking account. Here you can earn up to 1.25% interest, provided you meet the set criteria. BUT, this high rate is only for Personal checking. For business, it is only 1.01%

BlueVine, on the other hand, offers a 1.5% APY for eligible customers who maintain funds up to 100,000 in their business accounts.

Incurring Costs

Most Axos accounts do not levy a maintenance fee. However, failure to maintain a daily average balance in some accounts comes at a cost. Additionally, the bank charges ATM fees each time you use a system out of the network.

BlueVine business customers are safe from monthly fees. There are no fees for insufficient funds in the account. Customers can also carry out an unlimited number of transactions at BlueVine network ATMs at zero cost.

Minimum Balance

There are no minimum balance requirements across Axos accounts. However, some require a minimum opening deposit. For instance, a savings account requires an amount of $250 to open an account.

You are not required to maintain a minimum balance in a BlueVine checking account. Additionally, there is no minimum opening deposit.

Transaction Curbs

Axos is restrictive with its transactions. You can only do up to 200 fee-free transactions per month.

You can carry out unlimited transactions with BlueVine.

Under this feature, BlueVine is the clear winner since there are no restrictions on the number of monthly transactions.

Customer Support

Axos have customer support around the clock. If you have any banking queries, you can get in touch with them 24/7. This service is accessible via mail, phone, and mobile app.

BlueVine offers customer phone support to its users during weekdays from 8am to 8pm.

The Takeaway

Both Axos and BlueVine have services designed for small business owners. Their checking accounts are based on an online platform. However, their services differ from each other.

While there are multiple benefits associated with each bank, the clear winner of the best checking account for your small business is BlueVine.

BlueVine has great customer support availability. It offers multiple business services, great interest rates, unlimited check-writing, and no fees. Its standout feature is limitless transactions.

However, Axos is not far behind in offering great features. While BlueVine might be my personal pick, it is possible your business goals might align more with Axos than BlueVine. The final pick is yours!