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Compare the best free business bank accounts
Compare the features, fees and eligibility requirements of business bank accounts with no monthly fees.
Updated: 22nd April 2026
Written by Harry Jones
Edited by Liam Gray
Best free business bank accounts
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Some UK bank accounts have no monthly fee, but this doesn’t mean they’re entirely free of costs. While several providers offer monthly fees indefinitely, others charge them for an introductory period.
With 73% of SMEs open to switching and 44% seeking fee-free banking, the appetite for value is clear. Yet, all providers charge for something, whether that’s cash deposits, international transfers, or UK payments above a free allowance.
What is a free business bank account?
A free business bank account is a current account that doesn’t charge a monthly maintenance fee. Some are permanently free, while others waive the monthly fee for an introductory period (typically 12–25 months).
Free accounts cover the day-to-day activities expected of a current account, like sending and receiving payments. Not all accounts have unlimited transfers before incurring a fee, and some banks have better expense tracking than others.
Services that you may have to pay for include international transfers, ATM withdrawals, cash deposits, and CHAPS payments.
A free business bank account is not the same as a personal account used for business. Limited companies are legally required to have a separate business account, whereas many personal accounts prohibit business use. Free accounts are available to sole traders, limited companies, and, in some cases, LLPs and charities.
Free business bank account features to compare
Transaction limits
Estimate your monthly payment volume and check whether the free allowance covers it. Some accounts cap free transfers as low as five per month, with a flat fee per transaction after that. At higher volumes, these charges can exceed the cost of a paid plan.
Account software integration
Most providers connect to major platforms like Xero, QuickBooks, FreeAgent, or Sage, but not all do. Some include a free subscription worth £150–£380 per year as part of the account. Check compatibility with your existing tools before committing.
Invoice and expense tools
Several free accounts include built-in invoicing, automatic expense categorisation, and receipt scanning. These vary significantly between providers, so if reducing admin is a priority, compare what's included rather than assuming all accounts offer the same tools.
App quality and customer support
The CMA publishes service quality ratings every six months, broken down into categories like mobile banking, lending, and overall satisfaction. Currently, the three highest-rated providers offer accounts that are permanently free.
Overdraft and lending
Most free digital accounts don't offer overdrafts, loans, or credit cards. A handful do, but approval isn't guaranteed, and credit limits tend to be lower than on paid tiers. If access to borrowing is important, check before signing up.
Multi-user access and team cards
The majority of free accounts are built for a single user. Adding team members, issuing expense cards, or granting read-only access to your accountant often incurs extra costs. If you need additional access rights, check before applying.
Additional bank account fees explained
Monthly account fees
Some accounts are permanently free, while others waive the fee for an introductory period of 12 before reverting to a paid plan. Always check what the account costs after the free period ends, not just the headline rate.
UK transfer fees
Not all free accounts include unlimited UK payments. Certain accounts will cap the free allowance at as few as 5 transfers per month, with a flat fee for each additional transaction. At high volumes, these charges can exceed the monthly fee of a paid plan.
Cash handling fees
Most providers charge a percentage of the deposited amount when you pay in cash via a branch, Post Office, or PayPoint, typically 0.7% to 3% with a minimum charge of £2.50 to £4. For businesses that handle cash regularly, this is likely to be the single largest cost on a free account.
ATM withdrawal fees
ATM withdrawal fees are charged per transaction and vary widely between providers, ranging from completely free to £1 or more per withdrawal. Some include a free monthly allowance before charges apply. Check the terms if you withdraw cash frequently.
International payment & FX fees
International payment fees are fees for sending or receiving payments in foreign currencies. These usually include a transfer fee plus a currency conversion charge. Costs vary, so businesses that process large volumes of international payments should check rates carefully.
CHAPS fees
CHAPS is used for high-value same-day payments, such as property purchases or large supplier deposits. Most providers charge a flat fee per transaction, but not all digital providers and EMIs support CHAPS payments.
The main differences between free and paid accounts
Free accounts cover the basics well, but they come with trade-offs that become more noticeable as your business grows. The table below breaks down where free and paid accounts differ in practice, so you can judge whether the monthly fee is worth it for your situation.
| Free accounts | Paid accounts | Practical difference | |
|---|---|---|---|
| Monthly fee | £0. Either permanently or for an introductory period of 12–25 months before reverting to a paid plan. | £5.99–£25/month depending on the provider and tier. | £60 to £300+ per year, but fully tax-deductible as a business expense. The real cost is often lower than the headline figure once you factor in what’s included. |
| UK transfers | Varies. Unlimited on some providers. Others cap free transfers as low as five per month, charging 20p per transaction after that. | Usually unlimited. Free UK payments with no per-transaction charges. | At 20p per transfer, the break-even point is typically 30–50 payments per month. Beyond that, a paid plan works out cheaper. |
| Cash deposits | A percentage fee on every deposit. Typically 0.7%–3% with minimum charges of £2.50–£4. No free allowance. | Fees still apply. But some paid tiers include a monthly free deposit allowance before charges kick in. | Irrelevant for online-only businesses. Essential for retail, hospitality, and trades. A business depositing £500/week at 1.5% pays over £390/year. |
| Overdraft and lending | Rarely available. A few providers offer overdrafts, but approval isn’t guaranteed and limits tend to be lower. | Usually available. Higher credit limits, business loans, and credit cards are accessible through the same account. | Paid accounts let you consolidate banking and borrowing with one provider, simplifying cash flow management. |
| Accounting integrations | Available on most. Some include a free subscription to software like FreeAgent or FreshBooks. | Available on most. Bundled software is also common on paid tiers. | A free accounting subscription can be worth £150–£380/year, potentially offsetting the entire cost of a paid account. |
| Relationship manager | Not available. Support is handled through in-app chat, email, or general phone lines. | Sometimes included. A named contact who understands your business and can fast-track queries. | The difference matters most when resolving complex issues, discussing lending, or getting tailored advice. |
| Team and employee cards | Limited. Often restricted to a single user. Adding team members typically costs extra, with basic or no spending controls. | Multiple cards. Individual spending limits, real-time notifications, and admin controls included. | Becomes important as soon as more than one person needs to spend on behalf of the business. |
| Interest on balances | Basic or none. Some providers offer savings pots with modest rates. Many pay no interest at all. | Usually available. Higher rates on larger balances with more flexible savings options. | An extra 1% AER on £6,000 returns £60/year, which can cover or offset a monthly account fee. The gap widens as reserves grow. |
| Best for | Low-volume, digital-first businesses. Sole traders, freelancers, and early-stage businesses with straightforward banking needs. | Growing businesses. Those needing lending, handling cash, processing high payment volumes, or requiring multi-user access and dedicated support. |
Pros and cons of free business bank accounts
No monthly fees
Paid accounts often charge between £5 and £25 per month, adding up to £72–£300 a year. For many business owners, that saving alone can justify a free account until transaction volumes make a paid plan more cost-effective.
Separates business and personal finances
A dedicated business account creates a clean paper trail for HMRC and avoids complications if you're ever investigated.
Fast setup with digital providers
Most digital-first providers open accounts within minutes via their app, needing only a smartphone and valid photo ID.
Sometimes bundled with high-value extras
Many provides include extras like accounting software and sign up bonuses. If you're planning on paying for this anyway, these inclusions effectively make the account better than free.
Transaction caps quickly add up
Some providers include as few as five free UK transfers per month, charging 20p per transfer after that. At 70 transfers a month, that's £13 in fees, more than many paid plans charge as a flat monthly rate.
Limited team access
Most free accounts are built for a single user. Adding employees, directors, or even read-only access for your accountant often costs extra or isn't available, which can be a real constraint once you're not working alone.
Cash deposit fees are unavoidable
Rates range from 0.7% to 3% with minimum charges of £2.50–£4. A business depositing £500 per week at 1.5% would pay over £390 a year in deposit fees alone, easily outweighing the savings of having no monthly fee.
Balance caps on some accounts
Some providers cap balances at £500,000 or lower, which can become relevant for growing businesses holding reserves for VAT, corporation tax, or large contract payments. Check limits before committing.
When should you upgrade to a paid business bank account?
The simplest way to know when to upgrade is to compare the per-transaction fees on a free account against the monthly cost of a paid plan. If the fees outweigh the subscription cost, a paid tier becomes the cheaper option.
Take Tide as an example. On the free plan, 70 transfers per month work out to £13 in fees. The same usage on Tide Smart costs £20.49 (£12.49 monthly fee plus £8 in transfer charges, since Smart includes 30 free transfers compared to just 5 on the free plan). On domestic transfers alone, upgrading isn’t worthwhile.
International spending changes the picture. Tide Smart offers 0% FX fees, compared to 2.75% on the free plan. Any business spending more than £275 overseas each month would already be better off on the paid tier, before factoring in the other benefits of upgrading.
Features you can’t get on a free account
Some benefits are only available on paid plans, regardless of transaction volume. These typically include a dedicated relationship manager, higher overdraft limits, priority support, better savings rates, advanced expense management, and team cards with spending controls.
For businesses looking to use these features, the value of upgrading often goes beyond a simple break-even calculation and can be worth it in certain circumstances.
Our full comparison of business bank accounts can help you decide which provider yields you the best return on your monthly fee.
FAQs
Are free business bank accounts really free?
Free business bank accounts have no monthly fee, but have other costs like FX conversion fees or cash deposit fees. Sometimes, the monthly fee is only waived for an introductory period, so check before applying.
Can I get a free business bank account for a limited company?
Most free providers accept both sole traders and limited companies. Some also support LLPs and charities, though options are more limited for those structures. Check eligibility, as requirements around director numbers and UK residency vary.
Do free business bank accounts have transaction limits?
Most free accounts have hard limits, such as daily transfer limits. Within free accounts, limited companies are sometimes granted higher limits than sole traders, but the most reliable way to increase limits is by upgrading to a paid account plan.
Can I get an overdraft with a free business bank account?
It’s less common for digital-first providers, but some free accounts offered by banks like HSBC and Monzo offer overdrafts (subject to approval). If credit access is important to you, check before applying.
What happens when my free banking period ends?
When introductory period ends, you will automatically switch to a monthly tariff, and the amount will be deducted from the account balance. However, you’re free to switch to a different free account provider before this happens.
Are free business bank accounts FSCS-protected?
If the account is provided a bank, it will usually be FSCS protected. Some EMIs partner with a bank to provide FSCS protection, but most use safeguarding instead, where money is kept in a separate account but there’s no government guarantee.
Is it worth paying for a business bank account?
It depends on how you use the account. If you’re making more than 50 UK transfers a month, regularly depositing cash, or holding large enough balances to benefit from higher interest rates, the maths often favours a paid plan.
Factor in bundled perks, too. A paid tier that includes accounting software worth £300/year can offset most or all of the monthly fee, bringing the effective cost to near zero.
Which free business bank account is best for international payments?
Most free business accounts charge 1.5% to 3% on foreign exchange, which adds up fast if you’re paying overseas suppliers or freelancers regularly.
A few providers include fee-free transfers to certain countries, but for businesses trading in multiple currencies, dedicated multi-currency accounts from specialist providers will usually offer better exchange rates and lower overall costs.
Can I open a free business bank account with bad credit?
Several providers don’t run a hard credit check at all, and EMIs tend to have faster onboarding with more lenient criteria. Traditional banks apply stricter checks, but a poor credit score won’t necessarily disqualify you. Active CCJs or bankruptcy are more likely to be an issue than a low score alone.
Written by
Harry Jones
Harry has been a Finance Writer since 2019 and has worked with leading wealth management and fintech brands.
More recently, he has built in-depth domain knowledge on modern payment systems and enjoys helping smaller businesses compare options, find better solutions, and make smarter payment decisions.