Choose and manage a business bank account

Changing the bank your business uses can be time-consuming and disruptive.

However, the Financial Conduct Authority (FCA) Banking Conduct of Business Sourcebook (BCOBS) can help make the transfer of bank accounts quicker and simpler for customers.

If you are changing banks, you can ensure the process runs smoothly by:

• contacting your new bank and obtaining application forms in advance - check the terms and conditions of your new account carefully and discuss any concerns before returning the forms
• having business information ready for your new bank
• completing the mandate from your new bank to allow them to deal with your old bank on your behalf and request details of regular payments
• checking whether the bank will notify those who make payments to you, or whether you need to - the new bank will arrange for these payments to be switched
• monitoring both accounts carefully to check for irregularities - eg payments being made twice
• if possible, keeping your old account open until you're sure the new bank can deliver the required service

The new bank will notify you once they have completed their responsibilities for the transfer.

Advantages of switching business bank accounts

There are several advantages to switching business bank accounts:

• a new account could offer more attractive interest rates or lower charges
• a new bank might understand your requirements better than your current bank
• many bank accounts come with introductory offers eg free banking for an initial period
• your current bank may not offer 24-hour telephone or internet banking services

Disadvantages of switching business bank accounts

However, switching bank accounts can also have a number of disadvantages:

• if you have security or your accounts are complex, it can still take time and there's no guarantee of avoiding problems altogether
• using one bank for several years can demonstrate financial stability, which can be important for applying for a loan or other sources of finance
• you will lose the benefits of the relationship you have with your current bank
• you may need to assess the possible impact of switching on other arrangements you might have with the bank eg loans or credit cards