Best banks for business

When it comes to business banking, working out which financial service institution best suits your needs can be a tricky affair.

South Africa’s big banks each offer various accounts tailored towards businesses, and each account has structures, fees and added services catering for specific needs.

First National Bank’s business account has two payment options: a fixed-fee bundle account – which offers a number of transactions and services for a fixed monthly fee – or a pay as you use (PAYU) option.

The fixed-fee payment plan costs R169.00 per month, and bundles 30 electronic debit transactions (subject to a maximum of 5 FNB ATM Advance withdrawals) and 10 cash deposits (as long as they’re at FNB ATM Advance terminals).

According to FNB, its business account is suited to sole proprietors, partnerships, close corporations, companies, incorporated businesses, trusts and co-operatives.

The bundled transactions do not include cheque transactions; branch transactions; online banking enterprise; non-FNB transactions; as well as any special instructions or penalty
fees, which are all charged at PAYU rates.

Absa offers the Small Business Cheque Account and the Absa Biztransact Account – with the latter being a current account for small businesses which require a transactional account, but have no immediate need for a cheque book or overdraft.

The fees associated with both accounts remain similar, with the exception of the cheque-book and overdraft fees attached to the cheque account.

Absa’s Business Internet Banking (BIB) is charged at R105.00 per month, and the bank offers small businesses its Absa Business Essentials software package (QuickBooks Pro; planning, marketing and business and software skills courses) for R185.00 per month.

Nedbank‘s business account offers “a full-featured current account specifically designed for small businesses,” according to the bank.

It’s a pay as you use account, that provides banker services to assist with specific business needs, as well as customizable Internet banking.

Aside from Standard Bank‘s business banking current account, the bank has also targetted business start-ups and entrepreneurs with its Bizlaunch account.

The Bizlaunch account provides many of the bank’s electronic transactions and services in a bundled package and is available for a fixed monthly fee of R90.00 for the first 12 months of opening your business.

The bundled services include eight ATM cash withdrawals and unlimited cheque card purchases, electronic account payments, debit orders, inter-account transfers and others.

The account includes a merchant device for R325.00 a month, at a 3.25% commission rate as well as a wealth of other services to kick-start a business. Once the 12 month window is over, the Bizlaunch account converts to a transactional business account.

Capitec does offer business services to banking customers, but does not offer any business account.

“We don’t provide business banking for close corporations, companies, partnerships or trusts,” the bank’s website states.

Capitec is thus not included in the following comparisons.

Business accounts, head-to-head

When it comes to comparing business accounts with each other, all of the various offerings listed above should be taken into consideration.

However, in the end, it boils down to fees. Who is charging you the most to do the most basic or most common transactions?

In this instance, BusinessTech is looking at PAYU fees when dealing in specific transactions to give a clearer picture as to which bank provides the best value.

Monthly fees

A bank’s monthly fees differ depending on the account one uses (service fees, overdraft fees, internet banking fees, etc). The fees depicted below are the rudimentary amounts taken each month for the account to simply exist.

Cash deposits (Brand ATM)

Cash deposits have different fee structures in place that take into account where the cash is being deposited (cash centre, branch, ATM etc.) as well as different structures for the amount of cash being processed.

In this instance we look at the amount of R15,000.00 being deposited at a bank’s native ATM.

Debit orders

When it comes to processing transactions such as debit orders, the banks have set fees for internal processing, and for external processing, where a flat fee is not present, there is a fee cap in place.

Cash withdrawals

The comparison below looks at how much a business account holder would pay in service fees to withdraw R1,000.00 from a native and competing bank’s ATM, based on business account withdrawal fees.

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