Starting a small business in Virginia is definitely exciting, but choosing the right bank before you do that is important. The decision might not be as simple as it seems, though. Generally, we recommend Bluevine as the best bank for small businesses in Virginia, but there’s more that goes into that decision.
In this article, we’ll look in detail at the pros and cons of both national powerhouses and regional banks, and cover everything you need to know about opening a business bank account. Most importantly, we’ll help you choose the best bank for small businesses in Virginia. Regardless of what you prioritize, your struggle for finding the perfect Virginia bank for small businesses ends here.
Best Bank for Small Business in Virginia
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Which Bank Is Best to Open a Small Business Account?
It depends on how you like to operate your small business. If you’re more of an online-savvy business that wants convenience without compromising low fees, we recommend online banks like Axos Bank or American Express.
These banks typically have minimal or no monthly maintenance fees, along with user-friendly interfaces and mobile apps that can make managing finances on the go easy.
They also often come with generous transaction limits and some even offer interest-bearing checking accounts, which can be a plus if your business has some extra cash on hand. Online-only banks do have downsides though. For example, the lack of physical branches can be inconvenient if you have to deal with a lot of cash deposits or prefer in-person consultations with bankers.
You can also go for brick-and-mortar banks like Chase or U.S. Bank. These banks have been around for a long time and cater well to businesses that need or prefer face-to-face interaction.
As large banks, these also tend to have a wider range of services on offer alongside well established branch networks, so cash deposits and building relationships with bank personnel for financial guidance are both easy.
As a small business, if you’re looking to finance an expenditure, you’ll often get additional perks like business loans, merchant services, and safety deposit boxes here too. Keep in mind that all of this does tend to come with higher monthly fees and minimum balance requirements compared to online banks.
Best Bank for Start up Business
Silicon Valley Bank is one of the best options specifically for high-growth startups. They have a deep understanding of the unique challenges faced by young businesses, and so, they cater their financial products and services to address those needs as best as possible.
This includes venture debt and equity financing options, which can be the difference makers for startups seeking to scale quickly. Besides, SVB is a well-established bank with a network of connections within the entrepreneurial ecosystem, which means startups can link with investors, advisors, and possibly clients through their help.
Beyond financial services, SVB has a number of mentorship programs, workshops, and events specifically tailored to startups. If you’re a new entrepreneur looking to learn as much as you can about your industry, this can be quite helpful.
The one thing to note here is that SVB has stricter eligibility requirements compared to most other banks. They specifically target startups with significant funding or high-growth, so they might not work for every new business.
What Is the Best Bank to Use in Virginia?
Generally, we advise businesses to determine the “right” bank for themselves based on their specific requirements, since each business has different needs. However, for most Virginian businesses, Capital One has to be the choice that you can’t go wrong with.
They have a massive branch network across the state which comes with the convenience of in-person visits. At the same time, you have all the services you could ever need with their suite of digital banking tools for managing money remotely.
Specifically for small businesses, Capital One offers free checking accounts with unlimited digital transfers, a major money-saver for businesses that make most of their transactions online. They also have competitive rates on loans and credit cards, which can make financing options a bit easier on the budget for your business.
Although they’re not specialized in startups, the bank strikes a good balance between physical presence, digital features, and business-centric services. This makes them a versatile choice for most Virginia-based businesses.
Best Banks in Virginia
There are a lot of banks out there to choose from, so we would not consider this list an exhaustive one. That said, in our findings, we saw the following as being some of the top banks in Virginia.
1. Bank of America
This national giant has all the fundamentals of a bank–branch coverage throughout Virginia, convenient access to ATMs, and in-person assistance. They offer as many financial products for businesses as you could ever want, including checking and savings accounts, loans, merchant services, and investment options.
Bank of America is a solid choice for anyone that needs an all-encompassing suite of services and the security of a well-established brand.
2. Citizens & Farmers Bank
This is a regional bank and it shines with its focus on personalized service. Citizens & Farmers prioritizes building relationships with their clients and have business banking solutions tailored to specific needs in accordance.
At the same time, they do not compromise on their competitive rates on loans and deposits, which helps make their value proposition for businesses even better.
Another reason we like them is their particular focus on Virginia. They’re particularly knowledgeable about the local market, which means that businesses operating within the state can get a degree of localized advice from their consultants that a national bank may not provide.
3. Capital One
Capital One gets a double-mention in this article for being a good, well-rounded bank overall. The fundamentals are all there: physical branches, digital services, and a wide variety of plans that could fit any business of any size.
Their free business checking accounts with unlimited digital transfers are also nice for businesses that need a budget-friendly option, alongside pretty decent loan and credit card rates for financing options. If you need a bank that does everything well, Capital One is a good choice.
What Is the Best Bank to Use for an LLC?
If you’re looking to start an LLC in Virginia, and need a combo of convenience and bang for buck to go with it, consider giving Bluevine a shot. This is an online bank that has maintained small businesses as its primary customers.
Its business checking account with no minimum balance requirement and minimal monthly fees is a testament to that. This one feature aligns particularly well with LLCs that are still building their cash flow.
Beyond low fees, Bluevine also has a well-made, easy to use online portal and mobile app, so digital banking is not a problem at any point. With business checking accounts, you can benefit from their high-yield interest rates too; particularly useful if your LLC has any idle funds. Keep in mind that this bank, being an online establishment first, has a pretty limited physical presence, meaning no branches for cash deposits or in-person consultations, which is its only caveat.
What Do I Need to Open a Business Bank Account in Virginia?
The general documentation and information you’ll need to open a business bank account in Virginia is pretty consistent across different banks and is explained below. Keep in mind that there may be small variations depending on your business and the specific bank you choose, but this is a good starting point.
Business Verification
Proof of Business Formation: This can be different depending on your business structure.
- For LLCs, you’ll need a certified copy of your Articles of Organization filed with the Virginia State Corporation Commission (SCC).
- For corporations, a Certificate of Incorporation is required.
- If you’re a sole proprietorship or partnership, you might need a business license or a document establishing your business formation.
Federal Employer Identification Number (EIN): An EIN is mandatory for tax purposes and often required to open a business bank account. You can get an EIN for free by applying online or by mail through the IRS website.
Personal Identification
Valid Government-Issued ID: This is typically a driver’s license or passport for all owners or members with signing authority on the account.
Social Security Numbers: The bank will ask for the Social Security numbers of all owners or members with signing authority on the account. This is needed for identification and tax purposes.
Business Information
Be prepared to give them your basic business details, such as your business name, business address, phone number, and website (if applicable). The bank will also need information about the ownership of your business, including names, titles, and ownership percentages of all owners or members.
Account Details
Most banks have a minimum opening deposit requirement for business accounts (though not all, make sure to inquire for this option at your chosen institution). The amount can vary, so check with the bank beforehand. You’ll also be designating who has the authority to sign checks, make deposits, and manage the account on behalf of the business.
Other
Depending on your industry and location, you might need a business license to operate in Virginia. It’s not always mandatory for opening an account, but some banks may request it. Some banks might also need a formal resolution from your business authorizing the opening of the account and designating signatories–your mileage may vary.
What Is the Minimum Amount to Open a Business Bank Account?
The minimum amount of money needed to open a business bank account in Virginia changes as you go from bank to bank. Some banks, particularly online ones such as Bluevine, will offer accounts with no minimum opening deposit. However, most traditional brick-and-mortar banks have minimums ranging from $25 to $250 or more.
Make sure that you factor this minimum deposit into your initial budgeting when opening your account. Remember, some banks may waive the minimum deposit if you agree to maintain a certain minimum daily balance in the account, so be sure to inquire about those options as well.
Do I Need a Business Bank Account to Run a Business?
Every guide on how to start a business will mention the opening of a business bank account in their steps. It’s not always legally required, but we highly recommend having a separate business bank account for most businesses, regardless of size or structure.
Separating your business finances from your personal accounts is probably the biggest reason. It makes for clear and organized recordkeeping. You can easily track income and expenses related to your business, which results in much simpler cash flow management and finding areas for improvement.
When tax season rolls around, having a dedicated business will be an absolute lifesaver as it simplifies the process of gathering documentation and filing your tax return.
When you have a business bank account, you also project a more professional image to clients, vendors, and any investors you pitch to. It shows that you take your business seriously and operate with a level of financial responsibility. In fact, some vendors or clients will actually require (or at the very least, prefer) that you have one in order to work with them, as it adds a layer of legitimacy and makes for smoother transactions.
While not an ironclad safeguard, with a separate business bank account (especially for LLCs), you’ll get a level of liability protection too. If your business is sued, a separate account will keep any of your personal assets from being directly targeted. It creates a clearer distinction between your business and personal finances. This protection isn’t absolute though and does vary depending on your business structure, so keep that in mind.
Lastly, you can’t ignore scalability with a business, and scalability all but mandates a separate account. As your business grows, a dedicated business account will not only make payroll management easy, but may even become your only option.
It also separates business loan repayments from personal expenses you make, and will help you establish merchant services for accepting credit card payments. If you have a track record with a business bank, your separate bank account will help with any future loans or lines of credit to support you as you scale up.
Choosing the Best Bank in Virginia
Remember, the “best” bank for you isn’t the best bank for another business. Think carefully about your business needs and priorities, match them with the banks in this article, and select one.
Using the information we discussed here, alongside your own financial goals and banking preferences, you’ll be able to make a decision that sets your Virginia small business up for success.
Also, don’t hesitate to compare plans from several banks before making your final choice. Once you’re done, you can actually move on to the exciting parts of actually doing business as an entrepreneur.