How to Escape the High Cost of Business Banking
Say goodbye to monthly charges and hidden costs by switching to a no-fee business banking solution.
We’ve all heard the adage, “There’s no such thing as a free lunch.” For growing companies, extra fees and hidden charges from their business banking platform can be hard to swallow.
If you’re fed up with the high cost of business banking, the good news is that there are modern, no-fee options that can help you save precious capital without compromising on features or services.
Let’s take a closer look at the problem—and what you can do to avoid it.
How banking fees cut into your bottom line
Business banking fees can seem relatively harmless at first—a few dollars here, a small percentage there.
But over time, and as your business scales, these charges can add up to a substantial financial burden. Not only do they eat into your bottom line, they take away capital that could otherwise be reinvested in your company’s growth.
Look out for these common (and sometimes hidden) fees
Traditional banks find several ways to charge you for having and using their business checking accounts. Here are some of the most common fees and surcharges you’ll want to keep in mind:
- Monthly service or account maintenance fees
The most typical charge is the monthly service or account maintenance fee, ranging from $10 to up to $30 per month. Depending on your bank’s terms, you may be able to waive this fee with a minimum balance or by linking your account to other services, but that’s just one more hassle you have to worry about.
- ACH fees
Many businesses use the Automated Clearing House (ACH) network for issuing and receiving payments. And for good reason. ACH is simple, fast, and can be set up to automate recurring payments. While many banks allow you to receive ACH transfers for free, some charge a fee for sending them – ranging from $0.40 to $10. This can quickly add up if you tend to initiate a high volume of payments.
- Wire transfer fees
Wire transfers are another common payment method, especially for larger transactions. Similar to ACH, some banks charge to initiate a payment. The fee is typically around $25 for domestic wire transfers and $50 or more for international transfers.
- Foreign transaction (FX) fees
If you carry out a transaction with a foreign vendor, your bank may impose a surcharge for currency conversion. This fee can be as high as 3% of the purchase price, which can be a hefty expense on large transactions.
- Check purchases
While fewer businesses use physical checks these days, it’s still an essential feature for many companies. Some banks will offer complimentary checks, while others will charge you for a checkbook or require you to purchase checks from a third-party vendor. The cost for printing and issuing checks can range from $4 to $20 per check.
- Excess transaction fees
It’s common for basic business banking accounts to limit how many transactions your account can execute per month. This number can range from 20 to 250. Once you surpass your limit, you could end up paying a small fee up to $0.75 for every excess transaction.
- Overdraft or NSF fees
In the event that your account balance can’t cover a transaction, your bank will either block the payment outright or allow it to go through with an overdraft or non-sufficient funds (NSF) fee. For traditional banks, this penalty is typically around $35 per incident. You may be able to add an overdraft protection plan (at an extra cost) or link to another account to make backup funds available.
- Costs for multiple users or cards
If you have multiple team members using your business accounts or corporate cards, watch out for banks that charge a fee for each additional user.
Adding it all up
When you start crunching the numbers, you may be stunned at the total cost you’re paying for business banking. Here’s a hypothetical example of how unnecessary fees can add up and impact your bottom line.
Switching to no-fee business banking
Modern platforms like Rho offer feature-rich business banking solutions without the exorbitant costs. Since we don’t have brick-and-mortar branches (and when was the last time you went into a bank anyway?), we’re able to streamline our overhead and pass those savings on to our customers in the form of no-fee business banking.
When you switch to Rho, you get an innovative commercial banking platform with no monthly service charge. We don’t impose fees for common transactions and activities that businesses rely on, including ACH, domestic and international wires, bill pay, additional cards, checks, and more.
See how Rho helped Fabric, a fast-growing SaaS company, save over $60,000 in ACH and wire transfer fees.
Instead of sneaky surcharges, we believe in crystal-clear transparency. You can visit our pricing page to get a complete, straightforward list of all our fees (or lack thereof) and terms. With Rho, you’ll never be surprised by a charge again.
Start saving with Rho
Eliminating fees is just one way Rho adds value to your business. To learn more about our unique pricing model and the time-saving features of our integrated banking platform, schedule a quick meeting with one of our business banking specialists.