Axos vs Brex — The Best Choice for Online Business Banks

When it comes to handling the financial side of my business, I look for effortless services. I want banking services that offer convenience along with ease of use.

Updated 9/25/2023
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Because of recent changes at Axos, we are now recommending Novo ( Bank Novo ) over Axos due to significant changes at Axos that no longer benefit the customer ( you! ).

Check out our older review of Novo Vs Axos if you wish to review, or simply head over to Novo.
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Running a small business is tough in itself. However, with the right choice of the banking system, the entire process becomes straightforward.

In this article, I am going to break down the best choices among online banks for small businesses.

Why Do You Need Online Banking for Your Business?

If you are running a small business, you are very likely already acquainted with the exertion of scrambling to handle your finances. Managing your personal finances in addition to your business finances can keep you on your toes. Banking tends to consume a fair amount of your time.

However, with the proper banking tools, this cumbersome process can be converted to maximize your productivity and aid in running your business effectively.

One of the many reasons to select online banking is convenience. Instead of stepping inside a bank, most of the banking process can be done from anywhere. All you will require is a laptop or a mobile device, an internet connection, and the right online banking institution; you can set up shop from the comfort of your home.

Here are some of the key advantages of online banking that you need to take into account as a budding entrepreneur.

Convenient Accounting

Accounting tends to be very time consuming for business owners. Online banking offers seamless integration of accounting systems so that all your transactions are perfectly synced without requiring manual input.

This seamless management of your business account will provide you with instant financial statements at any time, with just a few clicks. It will also save you many hours of managing this process. Instead, you can use the saved hours to run your business.

Improved Organization

An often overlooked benefit of online banking systems is how well they help you get your business finances in order. They are convenient in helping you get your statements with a click, monitoring the inflow and outflow of money, and they ensure that you do not miss out on any payments.

You can quite easily set up recurring payments so that you do not end up having to pay any late fees. Such online banking features help you in organizing your finances without any additional stress.

Enhanced Security

Online banking offers more security than traditional banking systems. Security features such as multifactor authentication, biometrics, etc., are built into most online banking institutions to ensure that you do not fall prey to fraudsters, scams, and theft.

With online banking, you can also customize who gets access to what, as opposed to traditional banking. You can control which employees get access to which accounts for the better financial security of your business.

Additionally, since online banking offers a real-time view of transactions, you are immediately notified if something seems amiss. They are built with security triggers that alert you the instant a red flag pops you. This type of financial security is of the utmost importance.

Swift Transfers

Online banking systems offer almost instantaneous transactions than traditional banking. You can transfer funds overnight without any hassle. You will no longer have to wait for long durations for your check to clear before transactions can be completed.

Lower Fees

Yet another advantage of online banking over traditional banking methods is the lower costs. Since there are no overhead fees, online systems offer much lower fees such as monthly, maintenance, transaction, and overdraft fees. This is quite cost effective, especially for small businesses that are already struggling with a lot.

Widespread Access

Online banking offers you widespread access to your account. You no longer have to roll up to your bank’s location to get access to your statements, make vendor payments, verify a check, etc. You can easily get access to all this information at your fingertips from any location around the world.

You can also access your account during off days since there are no restrictions on business hours. Online banking services are available 24/7 for your convenience.

Environmentally Responsible

Unlike traditional banking, online banking systems do not leave a trail of papers since all their services are paperless and conveniently available on a mobile screen. As a business, you can contribute to a greener environment by going paperless in your financial activities.

How to Choose the Best Online Bank for Your Business?

Online banking is becoming the fastest-growing trend in the financial industry. These institutions offer unique tools that cater to your business needs without financial or mental stress.

However, before you get involved in an online banking system, here are a few key points that you should consider.

Banking Requirements

The very first point you need to consider is what are your banking requirements. Take a look at your business.

Are you looking to make a few payments locally, or do you plan on making international transfers? What does your monthly spending limit look like? Will you require a loan? How flexible is the service? Does your choice of bank align with your business goals? Do you work with cash or credit?

These are some of the questions that you will need to answer before you can settle on the right type of online banking institution.

FDIC Insurance

Some of us take this for granted when we walk into a bank. However, this important feature must never be overlooked. Before you open an account, make sure the bank is FDIC insured. The Federal Deposit Insurance Corporation is a safety net for your money.

In case an FDIC-insured bank fails, your deposit account will be eligible for protection, and you will be reimbursed up to $250,000. This limit is not per account, but rather it is set per account holder.

While most online banks are members of FDIC, it is up to you to ensure that your choice of bank falls under FDIC insurance. Do not just rely on the website for this information. Read the fine print.

Fee Structure

The majority of online banks take pride in their cost-friendly fee structure in contrast to traditional systems.

However, despite their overall low-cost fees, you will need to compare various banks to see what works best for you.

Certain online banks do not charge any fees, while others come with a monthly payment plan. Some restrict the number of free ATM withdrawals you can make in a day, a month, and a year. The ATM withdrawal fees vary from institution to institution.

It is also important to know your deposit and withdrawal limits in order to avoid additional fees.

Ideally, you should look for a service that offers access to a wide network of fee-free ATMs, especially if your business requires cash withdrawals. Compare and contrast the various fee structures and see which service incurs you the least amount of cost.

Management Tools

One major point of value for most online banks is that they offer many helpful management tools for businesses. Some offer credit and debit cards, checking and savings accounts, CDs, etc.

Additionally, they offer features that allow users to save money through automatic savings, offer competitive exchange rates, make easy payments across borders, etc.

Depending on your business goals and requirements, you will have to assess whether the banking institution has products that cater to your interests.

Minimum Balance

Besides fee structure, you should also verify if your bank requires a minimum balance to maintain an account. Some online banks require a minimum deposit to open an account. Some require a minimum balance or a monthly deposit to keep the account active.

The best online banks do not require a minimum balance or a monthly deposit in the account. However, if a certain bank requires the user to maintain a minimum balance or a monthly deposit, then failure to follow through could result in a fee being levied upon you.

Interest Rates

Since online banks have no overhead costs compared to conventional banks, they tend to offer much higher interest rates on savings. Some of the best institutions offer 0.81% APY on their savings accounts.

When choosing a business account, verify the rules and regulations that will qualify you for a high APY rate. All online banks do not have the same features, and some may not offer an option that is best for your business.

Customer Support

Since online banking institutions do not have a physical branch for you to walk into and address your banking concerns, you will have to ensure that their customer support is top-notch, regardless.

Before you finalize your bank, research how fast customer care responds to your query and resolves your problem. Of course, the benchmark for high-quality customer support is live support that is available 24/7 at a touch of a button.

In addition to quality customer care, it is also crucial that the institution provides a convenient interface for users to easily handle their finances.

Axos vs Brex — The Best Choice for Your Business

Like you, I have been on the other side, hunting for the best possible online banking system for my business. While it can be slightly difficult to land on the right choice, it is not impossible. I am going to use my experience to guide you between two choices — Axos and Brex.

Since the above section has shed some light on what you should be looking for in an online bank, let’s review my top choices in this section.

Of course, the final decision is yours, but my first pick is Axos — you will see why!

About Axos

Axos was established in 2000 as Bank of Internet USA. This digital bank offered early customers a basic checking account through an online platform. The bank steadily evolved aiming to deliver a universal banking experience to its customers. It became Axos Bank in 2018.

This digital bank currently encompasses a diverse array of products. It offers banking services and other full-service products such as business banking solutions, investment portfolios, lending options, etc.

It has evolved to include five checking account options based on individual requirements, including an account designed for teenagers stepping into the banking world. It also offers high-yield savings accounts.

Axos Bank touts the title of one of the best online banks in America.

Pros

● It offers many types of business accounts such as checking, savings, money market, and CD.

● Axos’s saving accounts with less than a $25,000 balance earn 0.61% APY. Balances up to $100,000 offer a 0.25% APY and anything higher earns 0.15% APY.

● It delivers a 0.20% APY, a much higher rate compared to conventional banks. Its Business Interest Checking account yields 0.81% APY.

● You can get a debit card.

● It allows up to 200 free transactions per month for checking accounts.

● Customer care service is available 24/7 with a live representative to solve any query.

● You will get unlimited refunds on ATM fees if you use an out-of-network ATM.

● Savings accounts do not have balance requirements besides the initial opening deposit of $250. There are also no maintenance fees.

● The money market account offers check-writing privileges.

● There is a low-cost Essential Checking account with zero monthly fees, zero minimum deposits, and zero overdraft fees. It also offers early access to your directly deposited funds.

● Its Rewards Checking account offers a tiered rate of interest of up to 1.25% APY.

Cons

● Some of its accounts offer a lower APY compared to other online banking systems.

● It requires a minimum opening deposit. For example, its Business Money Market account requires an opening deposit of $1,000.

● A monthly service charge of $10 is levied upon checking accounts (other than basic checking) that maintain less than a $5,000 daily balance.

About Brex

Brex was founded in 2017 as a solution for small business owners to get access to credit. Big conventional banks are not friendly towards startups and their founders. The fintech company aimed to provide cash management and other services to various businesses.

It is not considered a bank but rather an alternative for startups and other small businesses that are looking to find their financial footing in the industry.

The founders of this company simplified getting access to finances without the use of any third-party technology. Besides serving the needs of small businesses, they also provide services to well-established companies.

Their wide array of tools is meant to help businesses reach their true potential. One such tool is the Brex Card, a business credit card with tons of incentives.

There are two types of cards based on their repayment schedule. The daily credit card is included with the Brex checking account. However, the monthly repayment card requires an application and approval.

The fintech company’s customer base has been steadily increasing, with over 10,000 customers currently enrolling in its services.

Pros

● The fintech institution offers Brex Card, a corporate credit card, to even the newest of businesses. These cards can be easily availed at zero annual cost, and they do not require a personal guarantee or social security number.

● The Brex Card is easily availed even by those who do not have any credit score. Brex offers two payment schedules — monthly and daily, depending on your funding.

● You can use the card for daily payments and get rich rewards across a wide variety of categories. You are eligible for cashback on certain purchases. Brex allows offers other perks such as sign-up bonus points and up to $100,000 credits for new customers.

● There are no foreign transaction fees, annual fees, or wire transfer fees.

● Brex offers credit limits up to 20 times more than what you would receive with traditional cards, depending on whether you qualify for it.

● Brex offers virtual cards the instant you submit your online application. You can customize limits and get unlimited cards for your employees.

● With Brex Cash, there is a 0% intro APR, meaning you will not be charged any interest.

Cons

● To avail yourself benefits of Brex, your company will need to be registered in the US.

● You are required to showcase your company’s entire information, including the business model, spending pattern, origin of funds, etc.

● To become eligible for the daily repayment fee-free credit card, you must first register for Brex Cash, a business checking account.

● Brex’s credit limit varies depending on your business’ cash flow.

● If your company is backed by professional funds, you are required to maintain a minimum balance of $50,000 for a Brex Card with monthly payments or $100,000 otherwise.

● If you have invested in a money market fund, then Brex charges a certain percentage based on the account’s average seven-day yield.

● Brex is not a typical credit card but rather a charge card. You must settle the entire bill payment at the end of the day or 30 days, depending on your repayment schedule. If you fail to clear the payment, you will be fined, or worse, your account will be terminated.

● If your Brex Card is on the daily payment schedule, you cannot make payments in installments for any big purchases.

● You have to exclusively use your Brex Card to avail the big earning rewards.

● Brex does not offer cash deposits or ATM withdrawals.

Axos vs Brex

The above section dealt with the pros and cons of Axos and Brex banking systems. Now that you have a better insight into the various features of each system, it will be easier for you to decide the best choice for your business.

This section will further clarify any doubts you have and bring forth the clear winner in this battle of banks. Of course, the ultimate choice is yours, but I will still point out why I believe that Axos is the better choice of the two!

Services

The value of a banking institution is determined by the services it provides its customers. Of the two choices I compared, Axos stands out by providing numerous types of accounts and services for various purposes.

Axos Bank works as a full-service online banking platform and offers savings, checking, money market accounts, and CDs.

In addition to each of these accounts providing various services, Axos also offers businesses various banking solutions, investment portfolios, and lending options.

While Axos delivers a full-service deal, Brex falls a little short in this department. However, Brex offers credit and cash management services to businesses that would typically be turned away from banks.

Interest

Most online banking systems have their own set of interest rates. Usually, these rates are higher than the conventional banking institutions.

Axos offer different APY rates on its various accounts. Its highest tiered rate of interest is offered on its Rewards Checking account of up to 1.25%. The savings account can deliver up to 0.30% APY.

Its money market account rates vary depending on the account balance.

While Axos offers varying rates, Brex falls extremely short and offers none at all on any uninvested cash.

Axos stands out as a clear winner by offering an overall higher rate of interest earnings compared to Brex.

ATM Access

Access to ATM services is important because it provides customers with a convenient and easy way to perform transactions such as cash withdrawals and deposits.

Axos provides fee-free ATM withdrawals at almost 91,000 locations across the country. Additionally, most Axos accounts offer unlimited ATM fee refunds for withdrawals at out-of-network ATMs.

Alternatively, Brex cards cannot be used to withdraw any cash.

Customer Care

With any online banking system, customer care is a crucial element.

Axos offers reliable and consistent customer support. They are available for live support 24/7.

On the other hand, Brex offers limited support. They are available seven days a week, but only during the business hours of 5 AM to 8 PM PT.

The Takeaway

Updated 9/25/2023
**********************
Because of recent changes at Axos, we are now recommending Novo ( Bank Novo ) over Axos due to significant changes at Axos that no longer benefit the customer ( you! ).

Check out our older review of Novo Vs Axos if you wish to review, or simply head over to Novo.
**********************

You have finally reached the conclusion of the Axos versus Brex battle. Now, what are your final thoughts? Have you decided which is the best choice for you?

If I was not clear in the above sections, my winner is Axos Bank!

While both banking systems provide unique features, Axos rises above with its high-yield accounts, excellent customer support, and widely accessible ATMs.