Business checking accounts that don't use ChexSystems can be a tremendous help to small business owners with past banking blunders.
In this guide, we’ll break down some of the top online no credit check business bank accounts that don't use ChexSystems. Plus, we’ll go over what documentation may be required to open business bank accounts.
5 Business checking accounts that don't use ChexSystems
If you're looking for a traditional business banking relationship with your local banker, these banks are not them. They are online business checking accounts that operate entirely in the digital banking sphere.
|Novo Bank offers a free business checking account that does not use ChexSystems. Novo is a mobile business banking platform where you can manage your small business transactions online. Novo Bank is completely digital, with no physical branch locations, and deposit account services are provided by Middlesex Federal Savings, Novo’s partner bank.|
Novo Bank Business Account Features
Novo is a fintech, not a bank. Deposit account services provided by Middlesex Federal Savings, F. A.; Member FDIC. FDIC Insurance through Middlesex Federal Savings and virtual cards provided by Patriot Bank, N.A.; pursuant to Mastercard International.
|Found is a financial technology company that offers business banking services for self-employed people. The company is headquartered in San Francisco, California. Found's business banking services are designed to be simple, affordable, and transparent.|
Found Business Checking Features
Found is a financial technology company, not a bank. Banking services are provided by Piermont Bank, Member FDIC. The Found Mastercard® debit card is issued by Piermont Bank pursuant to a license from Mastercard Inc. Found’s core features are free. Found also offers a paid product, Found Plus.
|LiveOak Bank Live Oak Bank is an online-only digital bank that provides small business savings for freelancers, solo-preneurs, gig workers, and micro-businesses. LiveOak offers no monthly fees, free business bill pay, and fee-free access to more than 55,000 Allpoint ATMs.|
LiveOak Bank Business Savings Features
|Axos Bank offers business owners many useful tools and services like cash deposit capability, unlimited transaction limits, 24/7 customer support, free nationwide ATM access and unlimited domestic ATM fee reimbursements.|
Axos Bank Business Checking Features
|NorthOne Banking offers a free business checking account that does not use ChexSystems. The $10 monthly fee gives small business owners access to banking with no overdraft, NSF, or minimum balance fees
. Members can cancel at anytime. NorthOne is a financial technology company, not a bank. Banking services provided by The Bancorp Bank; Member FDIC.|
NorthOne Business Checking Features
Documents that may be required for a business checking account
Banks will have their own policies so you'll have to evaluate on a case-by-case basis. But most banks are required to verify your business as well as the persons associated with the business by obtaining certain documents.
Depending on how you structure your business entity, a bank may run a ChexSystems report to see how you've managed past checking and savings accounts. For instance, a sole proprietor will likely be required to provide an SSN (Social Security Number) that can be used to run a ChexSystems report. However, LLCs and Corporations that have an EIN (Employer Identification Number) may not have a ChexSystems report pulled.
Based on your business type, you may need one or more of the following documents issued by a Government agency:
Sole Proprietor. If the business name does not include the legal first and last name of the owner, you will need additional documentation. For example: If the owner’s legal name is Lisa Phillips, and the business name is Phillips Furniture, you will need additional documentation. However, if the business name is Lisa Phillips Furniture you will not. The additional documentation needed would be one of the following documents:
- Fictitious Name Certificate or DBA (doing business as)
- Certificate of Assumed Name
- Business License
- Registration of Trade Name
Limited Liability Company (LLCs) You will need one of the following business documents:
- Articles of Organization
- Certificate of Organization
- Certificate of Formation
Corporation You will need one of the following business documents:
- Articles of Incorporation
- Certificate of Good Standing
General Partnership You will need one of the following business documents:
- Partnership Agreement
- Fictitious Name Certificate or Statement
- Certificate of Assumed Name
- Business License
Basic Information on the business owner for all types of business structure
- Personal address
- Mobile phone number
- Email address
- Date of birth
- Social security number
ChexSystems is primarily used to report on consumer banking transactions. But just like a personal guarantee may be required to open a business credit card, your personal banking history can impact your business checking account.
Having negative items on ChexSystems is similar to the albatross of bad credit. It attaches itself and screams to banks “Risky – Do Not Approve!”
Banks use your personal checking account management habits as an indicator of how you might manage a business checking account. Separating your personal and business finances is one of the first necessary actions you should take when starting a business.
Why business owners need a business checking account
It's essential for business owners to have a separate business checking account from their personal checking account for several reasons:
Legal Protection. One of the primary reasons to have a separate business checking account is to establish a clear line between personal and business finances. This separation is crucial because it provides legal protection for business owners if their business is sued or audited. It also simplifies accounting and record-keeping, making it easier to track business expenses and profits.
Professionalism. Maintaining a separate business checking account adds a layer of professionalism to a business. It creates an image of a legitimate business and shows that the owner is serious about their business.
Tax Reporting. Separating business and personal finances makes tax reporting much more manageable. Having a separate account makes it easier to identify and track deductible business expenses, which can help business owners save money on taxes.
Financial Organization. A separate business checking account can help business owners keep their finances organized. It allows them to track their business expenses, income, and profits separately from their personal finances. This separation makes it easier to understand the financial health of the business and make informed decisions based on financial data.
Having a separate business checking account is a smart and necessary decision for any business owner who wants to protect their assets, maintain a professional image, and keep their finances organized.
Here are some management tips to help keep your business checking account in good standing:
- Deposit business income.
- Use the business account just for business expenses. Never use a business bank account for personal use.
- Track business expenses; this includes payroll, contractor payments, and investments in furniture or equipment.
- Use tools and alerts to keep track of account transactions.