Banking

High Yield Business Savings Account (2023)

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In the dynamic landscape of modern business, the importance of safeguarding surplus funds while earning substantial returns cannot be overstated. 

As entrepreneurs and business owners seek ways to optimize their financial strategies, high-yield business savings accounts have emerged as a compelling option. These accounts offer a win-win solution, combining the liquidity and accessibility of traditional savings with the potential for impressive interest rates, proving to be a valuable asset in the pursuit of financial prosperity.

Among the myriad of options available, four institutions stand out as pioneers in providing exceptional interest rates: U.S. Bank Platinum Business Money Market, First Internet Bank Business Money Market Savings, NBKC Bank Business Money Market and Live Oak Bank Business Savings.

High Yield Business Savings Account Comparison Chart

Product NameU.S. Bank Platinum Business Money MarketFirst Internet Bank Business Money Market SavingsNBKC Bank Business Money MarketLive Oak Bank Business Savings
High Yield Business Savings Accounts U.S. BankHigh Yield Business Savings Accounts First Internet BankHigh Yield Business Savings Accounts NBKC BankHigh Yield Business Savings Accounts Live Oak Bank
Annual Percentage Yield (APY)0.05% to 1.15% (bonus rate of 4.25% for the first six months available through July 31, 2023)3.45% to 5.33%2.25%4%
Minimum Deposit$100$100$0$0
Monthly Fee$15 (waived with a minimum balance of $10,000)$5 (waived with a minimum balance of $4,000)NoNo
Transaction LimitNoUp to 6 a monthNoUp to 6 a month

What is a high-yield business savings account?

A high yield business savings account is a financial product offered by banks and financial institutions specifically designed to help businesses maximize their savings while earning competitive interest rates. Unlike traditional savings accounts, which may offer nominal interest rates, high-yield business savings accounts provide substantially higher returns on the funds deposited.

These accounts are an attractive option for businesses with surplus cash reserves that are not needed for immediate operational expenses. By placing their excess funds in this type of savings account, businesses can earn more interest on their money, allowing it to grow over time.

U.S. Bank Platinum Business Money Market

High Yield Business Savings Accounts U.S. Bank

At first glance, the Platinum Business Money Market Account of U.S. Bank may not be the most appealing option. After all, it only offers a 0.05% APY for accounts with less than $50,000 and tops out at 1.15% for those with $3 million or more. It’s worth noting that there’s an opening deposit of $100, and then there’s a monthly fee of $15, though it’s waived with a $10,000 minimum daily balance.

That said, clients stand to earn a 4.25% bonus interest rate for six months starting from the date they open their account and complete qualifying activities. As is usually the case, it’s subject to certain terms and limitations. At the time of writing, this promo is valid through July 31, 2023.

To be clear, what you need is a minimum balance of $25,000 to be eligible for it, and among the limitations is that it isn’t valid for balances of $3 million or more.

First Internet Bank Business Money Market Savings

High Yield Business Savings Accounts First Internet Bank

For parking huge amounts of money, First Internet Bank’s Business Money Market Savings account is arguably among the most ideal choices out there. For starters, it can be opened with $100, and its monthly fee of $5 is waived with a daily balance of $4,000. The best part is, it can earn a 3.45% APY for a balance of $5 million and below, and it goes up to 5.33% for balances above $5 million.

It should be noted that it doesn’t have any physical branches you can visit, but the upside to that is the cost of maintaining locations is more or less passed to the customers in the form of competitive rates. However, you should keep in mind that ATM cards are available only to sole proprietors, and there’s a transaction limit of up to six per month.

NBKC Bank Business Money Market

High Yield Business Savings Accounts NBKC Bank

There are plenty of reasons to love the Business Money Market account from NBKC. First off, you stand to earn an APY of 2.25%, and you only need $0.01 in your balance to start doing so. On top of that, there’s no monthly fee at all, and there’s no opening deposit required to boot. It doesn’t end there either, as there aren’t any fees for nonsufficient funds, overdrafts, stop payments and incoming domestic wire transfers.

It does cost $5 to send domestic wire transfers and $45 to send and receive international wires, but those are pretty much the only fees you’ll have to take into account.

Click here for our explainer about the difference between wire and ACH transfers.

Live Oak Bank Business Savings

High Yield Business Savings Accounts Live Oak Bank

The interest rate you can get from Live Oak Bank’s Business Savings account isn’t just one of the most competitive in the industry, but it’s also among the most accessible. For one thing, you only need $0.01 in your balance to enjoy its 4% APY. You don’t even have to worry about monthly fees or a minimum deposit, and opening an account is as easy as 1-2-3 via its website. The bank even has a mobile app, making it simple to manage your account.

At the risk of grasping at straws here, the only potential caveats are that it doesn’t have any physical branches you can go to, and there’s a transaction limit of up to six per month. Those hardly outweigh the advantages, though.

Advantages of High Yield Business Savings Accounts

Competitive Interest Rates: High-yield business savings accounts typically offer significantly higher interest rates compared to standard counterparts. This means your idle funds can generate more substantial returns, helping your business grow its savings faster.

Maximized Earnings: By earning more interest on your deposits, your business can maximize its earnings without taking on additional risk. These accounts can be an essential component of a well-rounded financial strategy, helping your funds work harder for you.

Liquidity and Accessibility: High-yield business savings accounts provide the flexibility of withdrawing funds whenever needed. Unlike long-term investments, your money remains accessible for emergency expenses, unexpected opportunities or working capital requirements.

Low Risk: These accounts are typically offered by reputable financial institutions, and the Federal Deposit Insurance Corporation (FDIC) insures deposits up to the legal limit (currently $250,000 per account holder per bank). This safety net provides peace of mind, knowing your funds are protected against unforeseen events.

Separation of Funds: Opening a high-yield business savings account allows you to keep your operational funds separate from your savings. This clear demarcation can aid in better financial management, budgeting and planning for future investments or expansion.

No Lock-In Period: Unlike some long-term investment vehicles, high-yield business savings accounts do not have a lock-in period or penalties for withdrawals. This flexibility allows you to access your funds without restrictions, making it ideal for short-term savings needs.

Easy Account Management: Managing a high-yield business savings account is typically straightforward. Many financial institutions offer user-friendly online platforms, enabling easy transfers, monitoring account activity and setting up automated transfers for savings.

No Monthly Fees: Numerous high-yield business savings accounts come with no monthly maintenance fees, ensuring that your earnings remain intact without any deductions.

No Minimum Balance Requirement: Some high-yield accounts waive minimum balance requirements or have lower thresholds compared to other types of accounts, making it easier for businesses of varying sizes to open and maintain the account.

Relationship Benefits: Establishing a high-yield business savings account with a bank where you already have a business relationship may open doors to other valuable financial products and services, such as business loans or lines of credit, fostering stronger ties with the institution.

Diversification of Funds: High-yield business savings accounts offer a safe way to diversify your company’s financial portfolio without exposing the funds to market fluctuations or investment risks.

Things to Consider when Choosing a Business Savings Account

Interest Rates: Compare the interest rates offered by different financial institutions. Look for accounts that provide competitive yields to maximize your earnings on idle funds.

Fees and Charges: Check for any monthly maintenance fees, transaction fees or other charges associated with the account. Opt for accounts with minimal or no fees to preserve your earnings.

Minimum Balance Requirements: Some accounts may require a minimum balance to be maintained. Assess if your business can comfortably meet the minimum balance without affecting your day-to-day operations.

Accessibility: Evaluate how easy it is to access your funds when needed. Look for accounts with online banking options, mobile apps and quick transfer capabilities to manage your savings efficiently.

Account Restrictions: Check for any limitations or restrictions on withdrawals or transfers. Ensure the account’s terms align with your business’s cash flow and savings needs.

Bank Reputation: Choose a reputable bank or financial institution with a track record of stability and excellent service. Established institutions often provide added peace of mind.

Special Promotions or Incentives: Some banks offer promotional interest rates or sign-up bonuses for new accounts. Take advantage of any special offers to boost your initial earnings.

Verdict

Considering their rates and terms, it isn’t surprising that U.S. Bank Platinum Business Money Market, First Internet Bank Business Money Market Savings, NBKC Bank Business Money Market and Live Oak Bank Business Savings are among the best high-yield business savings accounts to park your surplus funds and reap substantial rewards. 

Needless to say, each one has its own unique benefits and downsides, but one thing is for sure: Your hard-earned cash is in good hands with any of them. After all, they’re well above the national average of 0.42% APY, according to the FDIC. What’s more, the upkeep is minimal and nonexistent in some cases.