What you need before you walk in

A business bank account requires proof that your business exists as a legal entity separate from you personally. The bank will ask for documents that show this, and the exact list depends on your business structure and the bank you choose. Most banks want to see an Employer Identification Number (EIN) — a nine-digit number issued by the IRS that works like a Social Security number for your business.

If you are a sole proprietor operating under your own name, you may be able to open an account with just your Social Security number, though many banks now require an EIN even for sole proprietors. If you have formed an LLC, S-corp, C-corp, or partnership, you must have an EIN before the bank will open an account. You can apply for an EIN online at irs.gov for free, and the IRS issues it immediately.

Beyond the EIN, bring a government-issued photo ID, your Social Security number or EIN, and proof of your business address — a utility bill, lease, or mortgage statement dated within the last 60 days. If you formed an LLC or corporation, bring your Articles of Organization or Articles of Incorporation. Some banks also ask for a business license, though this varies by state and bank.

Key Takeaways

  • You must have an Employer Identification Number (EIN) from the IRS before most banks will open a business account, unless you are a sole proprietor operating under your own name.
  • Bring a photo ID, proof of your business address, and your formation documents (Articles of Organization or Incorporation) if you have formed an LLC or corporation.
  • The bank will verify your identity and business structure, which usually takes a few minutes in person or up to several business days if you apply online.
  • Monthly fees, minimum balances, and transaction limits vary widely by bank, so compare options before you choose — some banks offer free business accounts for the first year.
  • Once your account is open, you will receive a debit card and checks, and the bank will provide you with routing and account numbers for wire transfers and ACH payments.

Getting an EIN if you do not have one yet

If your business is a sole proprietorship and you operate under your own name, you can use your Social Security number instead of an EIN. However, using an EIN keeps your personal and business finances separate in the IRS system and is generally safer for your privacy. Many banks now require an EIN regardless of business structure.

To get an EIN, go to irs.gov and use the online application under "Apply for an EIN." You will answer questions about your business type, location, and reason for needing the number. The application takes about 10 minutes, and the IRS issues your EIN immediately — you can write it down or print it right away. There is no fee.

If you prefer not to apply online, you can call the IRS at 1-800-829-4933 during business hours, or mail Form SS-4 to the IRS address listed on the form. Phone and mail applications take longer — phone approval is usually same-day, but mail can take up to four weeks.

What to expect during the account opening process

If you open the account in person at a bank branch, a banker will review your documents, verify your identity, and ask questions about your business — what you do, how much revenue you expect, and whether you will be receiving checks or making wire transfers. This conversation helps the bank understand your account activity and flag anything unusual later. The process usually takes 15 to 30 minutes.

If you open the account online, the bank will ask you to upload photos of your documents and may require a video call to verify your identity. Online applications typically take longer to process — anywhere from one to five business days — because the bank cannot verify documents in real time. Some banks will give you temporary account numbers while they complete their review, so you can start receiving deposits before the account is fully active.

The bank will run a background check and may check ChexSystems, a database that tracks banking history and fraud. If you have had accounts closed for cause or have unpaid overdrafts, the bank may deny your application or ask you to resolve those issues first. This is separate from your personal credit score — the bank is not checking whether you pay your bills on time, only whether you have been flagged for fraud or abuse of banking services.

Fees, minimums, and account features to compare

Business bank accounts are not free the way many personal accounts are. Most banks charge a monthly maintenance fee ranging from $10 to $30, though some waive the fee if you maintain a minimum balance or set up direct deposit. A few banks offer free business checking for the first year or permanently if you meet certain conditions — for example, maintaining $5,000 in the account or processing a certain number of transactions per month.

Compare the cost of checks, wire transfers, and ACH transactions. Some banks charge per check or per wire, while others include a certain number of each per month. If you will be making many payments to vendors or employees, these per-transaction fees add up quickly. Ask whether the bank offers ACH origination — the ability to send payments directly from your account to other bank accounts — because this is usually cheaper than wire transfers and faster than mailing checks.

Ask about overdraft protection and what happens if your account goes negative. Some banks will automatically transfer money from a linked savings account, while others will simply decline the transaction or charge an overdraft fee. Understand this before you open the account, because overdraft fees can be $25 to $35 per occurrence.

Setting up online banking and payment tools

Once your account is open, the bank will provide you with online banking access — a username and password that let you check your balance, view transactions, and transfer money between your own accounts. You will also receive a debit card and checks, usually within 5 to 10 business days. Checks take longer because they are printed to order; debit cards are sometimes available immediately or within a few days.

Ask the bank whether they offer bill pay — a service that lets you schedule payments to vendors and service providers directly from your account. This is different from ACH origination and is often included free with business accounts. Bill pay is useful for paying rent, utilities, and other regular expenses without writing checks.

If you will be receiving payments from customers, ask about payment processing options. Some banks offer merchant services — the ability to accept credit cards and debit cards — though this usually comes with a separate fee and application. Other banks partner with third-party processors like Square or PayPal, which you can set up independently.

What happens if the bank denies your application

Banks can deny a business account application for several reasons: a history of fraud or abuse in ChexSystems, unpaid overdrafts at other banks, or concerns about your business itself. If the bank denies you, ask them to explain why in writing. You have the right to know the reason, and some banks will reconsider if you can resolve the issue — for example, by paying off an old overdraft.

If you are denied because of ChexSystems, you can request a copy of your report from ChexSystems directly at chexsystems.com. You can dispute inaccurate information or add a statement explaining the circumstances. This takes time, but it may help you open an account elsewhere.

If you cannot open an account at a traditional bank, some credit unions and online banks have less stringent requirements. Credit unions often focus on their members and may be more willing to work with you if you join. Online banks like Novo or Mercury cater to small businesses and may have different approval standards. However, these alternatives may have higher fees or fewer features, so compare carefully.

Keeping your account active and in good standing

Once your account is open, use it regularly. Banks close accounts that show no activity for extended periods — usually six months to a year — because inactive accounts cost the bank money to maintain. Make at least one deposit or withdrawal every few months to keep the account active.

Reconcile your account monthly by comparing your bank statement to your own records. This catches errors, fraud, and unauthorized transactions early. If you spot something wrong, report it to the bank immediately. Banks have different timelines for investigating disputes — typically 10 business days for ACH transactions and up to 30 days for other issues — so the sooner you report, the sooner they can investigate.

Keep your contact information current. If the bank cannot reach you, they may freeze your account or close it. Update your phone number and address whenever they change, and check your email regularly for messages from the bank about your account.

Frequently Asked Questions

Do I need a business license to open a business bank account?

Not always. Most banks require an EIN and formation documents (if you have an LLC or corporation), but not a business license. Some states and cities require a business license before you operate, but the bank does not always verify this. Check your local requirements separately from the bank's requirements.

Can I open a business account if I am a sole proprietor with no employees?

Yes. Sole proprietors can open business accounts, though some banks require an EIN and others will accept your Social Security number. Using an EIN is optional for sole proprietors but recommended because it keeps your personal and business finances separate.

How long does it take to open a business account?

In person, usually 15 to 30 minutes. Online, typically one to five business days for full approval, though some banks provide temporary account numbers while they complete their review. You will receive checks and a debit card within 5 to 10 business days after approval.

What if I do not have a physical business address yet?

Most banks require proof of a business address — a lease, utility bill, or mortgage statement. If you are working from home, use your home address. If you do not have a permanent location yet, some banks will accept a UPS box or a virtual office address, though this varies. Call the bank before you apply to ask what they accept.

Can I use a personal bank account for my business?

Legally, yes, but it is not recommended. Mixing personal and business money makes taxes harder, creates liability issues, and can complicate disputes with customers or vendors. A separate business account costs little and protects you.