Best Business Savings Accounts 2024

We compared easy access business savings accounts from across the market (October 2024) to arrive at our pick of the best. We compared the interest rates on offer, the minimum and maximum deposit amounts, plus the flexibility of the account in terms of how it can be opened and managed. Find out more at our methodology below.

A business savings account is a cash deposit account which small businesses can use for storing cash reserves, ideally earning a higher rate of interest than they would in a business current account or ordinary bank account.

Often a business savings account is taken out with the same provider as the business’s main current account, so the business can move cash easily between the two accounts as needed.

Other uses for a business savings account include putting money aside for emergencies, holding funds for tax bill payments and paying off debts, such as a business bank overdraft.

If you’re a sole trader or independent contractor, a business savings account allows you to separate your business funds from your personal savings. Although as a sole trader or freelancer you could also open a personal savings account to hold your business savings.

A business savings account works in the same way as a personal savings account, except it’s specifically for business use. The business can deposit cash reserves into the account, subject to its terms and conditions, and then earn interest on the balance, either at a variable or fixed rate.

There are different options for business savings, including:

• easy or instant access savings (where you can usually make deposits and withdrawals freely without penalty)
• notice accounts (which require you to give notice before you can make a withdrawal)
• fixed rate accounts. Also known as fixed rate bonds, these accounts may offer a fixed rate of interest, for example for 12 months or two years, so long as you don’t require access to the funds.

Depending on the bank or specific account, your business may need to meet deposit or balance requirements to maintain a business savings account or earn interest.

While some business savings accounts can be opened in a bank branch or over the phone, others may be online or app only.

It can be important for business owners to keep a separate business savings account. Here are some reasons why having a business savings account might be beneficial:

• safe-keeping. A business savings account gives you a safe place to store cash not earmarked for immediate needs and separate from your everyday business bank account
• interest. A business savings account lets you earn interest on surplus cash while keeping your money easily accessible
• financial safety net. Building up a savings fund for your business gives you a cushion to cover unexpected expenses and emergencies.

While high interest business savings accounts offer several benefits, these accounts might not be right for every business. Here are some advantages and disadvantages to consider:

Pros

• competitive rates. High interest business savings accounts tend to offer better rates than on business current accounts
• no fees. There don’t tend to be any monthly or annual fees or charges on business savings accounts
• accessibility. Funds kept in easy access business savings accounts are accessible through electronic transfers and other methods. Some accounts may even come with a cash card for convenient cash withdrawals.

Cons

• no branch support. The best business savings accounts tend to be offered by online providers with no high street presence. If you have any issues with your account you may have to get in touch via email or online chat
• minimum balance. Most providers will require you to meet minimum balance levels to open an account, this might be £1,000 for example, but it could be higher
• potential missed opportunities. Business savings accounts allow you to earn interest on cash reserves, but it could mean you miss out on opportunities to invest that money back into your business.

There are a range of different types of savings accounts for your business. They tend to vary in terms of the level of access you have to your cash. The three main types are:

• easy or instant access: make unlimited deposits and withdrawals to the account without penalty
• notice accounts: access to your savings is subject to a notice period, such as 30 days. In some cases the notice can be quite long, up to 180 days, for example. You’ll usually notify the savings provider of your intention to make a withdrawal and then wait for the notice period to lapse before receiving the money
• fixed rate accounts: as the name suggests fixed rate accounts or bonds mean you lock away your funds for a fixed term, such as one, two, three or even five years. In return for losing access to your savings during the term you’ll typically receive a higher rate of interest, compared to a notice or easy access account.

Compare multiple banks and other financial institutions to find the account best suited to your needs. These factors are worth considering when comparing accounts:

• interest rate: Compare rates and seek out top paying accounts to maximise the return on your savings.
• customer service: Choose a bank that matches your customer service needs. If you need in-person support, look for a local bank with a high street branch that offers business banking. Consider features like phone support, private messaging and customer service hours when making your decision
• digital banking features: Many banks now offer mobile apps and online account access. Check app ratings and read about the online and mobile banking features offered with the accounts you’re considering.

It’s important to compare the options at traditional banks, online banks and other ‘challenger’ providers before deciding. Online banks can offer higher rates than brick-and-mortar banks due to lower overhead costs.

However, traditional banks are still worth a look, especially if that’s where your business current account is. Check with the provider to find out whether there are any preferential savings rates for existing customers, for example.

As well as the rate, think about the access you’ll need to your business funds. Chasing the top paying account won’t work if it means you have to lock the money up for at least a year. Interest rates are important for your business savings, but they aren’t the only factor to consider when choosing an account.

The amount of cash your business should keep in savings depends on your monthly needs, expenses and how long you’ve been in business.

Experts generally recommend keeping at least three to six months’ worth of operating expenses on reserve in savings as a safety net. Consider your business structure and goals to find a sweet spot for your business.

Established businesses with consistent profits may benefit from keeping more savings in the bank, which can offer the opportunity to earn steady returns on funds not in use.

Start-ups, on the other hand, may need to reinvest profits in order to grow and might not have as much money to set aside.

The process of opening a business savings account depends on the financial institution. Many banks allow business owners to open business savings accounts online or even via an app, but some may require an in-person visit to a bank branch to apply.

During the application process, the savings provider is likely to ask you to give personal and business information to verify your identity.

Depending on the provider you may need to provide the following documentation to open a business bank account:

• photo ID, such as passport or driver’s licence
• email addresses and information about the account signatories
• business name
• business address, (with proof of address)
• details of the business bank account (current account)
• information about the business, such as annual turnover.

Once your application is approved, you can typically fund your new business savings account by linking another bank account and transferring funds into the account.

Business savings accounts aren’t the only option available to businesses. Many alternative accounts offer similar benefits as savings accounts, such as earning interest or the potential for capital growth. Here are some examples:

• business money market accounts. Money market accounts offer high interest rates and often come with benefits like a cash card for more convenient access to the money
• investment accounts. Some brokerage firms offer investment accounts for businesses, with options that often include stocks, bonds, mutual funds and exchange-traded funds (ETFs). Brokerage accounts made up of volatile assets come with greater risk than savings accounts but also offer the potential to earn higher returns.

But when it comes to investments it is important to bear in mind that your capital is at risk and values can fall as well as rise. In addition, the minimum investment amount is likely to be higher for business investment accounts compared to cash savings.

To arrive at our Forbes Advisor star ratings we selected accounts based on:

• gross interest rate
• how the account can be opened (online or in branch, for example)
• minimum deposit required
• range of banking options: eg. branch, online, post and phone
• any restrictions on account opening (eg. must have a linked bank account)

We then ranked the accounts based on these factors to arrive at our pick of the best business savings accounts.

None of the accounts we’ve listed charge monthly or annual fees and all have FSCS protection up to £85,000 per banking institution. We used independent website Savings Champion to reference the best deals.

While account details are correct at time of publication, savings rates can change frequently.