How Many Bank Accounts Should a Business Have? A Guide

Running a small business is exciting, but managing your finances can feel like a whole lot more than you bargained for. One question that often trips up small business owners is: how many bank accounts should a business have? ‍ The thought of multiple bank accounts might be daunting, especially when having just one bank account requires you to:

Make sure you’re aware of all the small business bank account fees and interest rates related to the account.
Jump through hoops to secure SME funding when needed via a chequing account.

Yet having separate bank accounts can help your business in several ways. QuickBooks, a leading bookkeeping software provider, pinpoints five key reasons multiple accounts can help you manage daily operational expenses, customer payments, taxes, payroll and savings.

Despite these uses, it still leaves us with several questions hanging in the air: Is it necessary to have all these different bank accounts? How many bank accounts should a business have?

Read on to learn more about the number of bank accounts you should have, how multiple accounts can help your business, and how Lula’s Unlimited and Free Business Bank Accounts can fast-track your business’s growth.

How Many Bank
Accounts Do Most
Businesses Have?

South Africa has 5.78 million SMEs, but over half of them don’t have a business account, according to data from Moneyweb.co.za.

Many South African small business owners just use their personal accounts.

However, mixing your personal and business finances like this can lead to several difficulties, including:

• Difficulty tracking business income and expenses complicating accounting and tax filing.

• Exposing your personal finances to business-related fraud (or vice versa).

• Missing out on the liability protection that a separate business account often brings.

Opening a single account for your business, then, means you avoid these pitfalls and get an advantage over many of your rivals. However, there are advantages to having multiple business bank accounts.

How many bank accounts should a business have?

The Perks of Having Multiple Business
Bank Accounts

Having multiple business bank accounts offers perks that can help you run your business more efficiently. Here are some of the perks:

Optimise financial management

A dedicated business bank account can help you streamline your financial management processes. For example, you can manage operating expenses (rent, payroll), savings goals (equipment upgrade) and tax payments with one account to improve financial management and budgeting.

Earn interest on your capital

A high-yield savings account for your business savings can earn a higher annual percentage yield (APY) on your idle funds compared to a standard chequing account.

Manage banking fees

Some financial institutions offer accounts with lower monthly fees if you maintain a minimum balance in another of their accounts.

Fraud protection

Spreading your funds across accounts can minimise the risk if one account is compromised.

Managing multiple accounts requires discipline, but if you can do it well and avoid pitfalls like overdrafts, you’ll find that your business will be a lot more secure and well-organised.

how many bank accounts should a business have.

How Many Bank Accounts Should a Business Have?

We’ve already established that having just one business account is a good starting point, but how many bank accounts should a business have? Is it too much to have four bank accounts, for example?

Financial experts often recommend that self-employed business owners have a certain number of accounts to optimise their business operations.

However, the truth is that there’s no magic number: the ideal number of accounts depends on your specific business’s financial needs and size.

Smaller businesses might start with just a chequing account, for example, while larger ones often have several different accounts for various purposes.

Here’s a common set-up for a start-up just finding its feet:

• Business chequing account: For everyday business transactions like receiving payments.

• Business savings account: To save for short-term financial goals like equipment purchases.

After a while, established businesses can upgrade their accounts or add extra facilities to help them move through different growth phases. An example would be an upgrade to a comprehensive business account.

An upgrade on a chequing account, these help businesses process a large number of transactions (without incurring high fees) by offering features like unlimited free electronic funds transfers (EFTs), faster access to business funding, dedicated customer support, and integrated cash flow management tools.

In short, the further you progress along your business journey, the more bank accounts you’re likely to have. This can help you upscale your operations and organise your business expenses, not to mention take advantage of perks available to established businesses.

Which Business Banking Fees Should I Take
into Account?

Having more than one type of account does come with some downsides.

One major concern is the potential for accumulating various banking fees for a small business. These costs are often buried in the fine print of terms and conditions (T&Cs).

It’s important to be aware of the following charges that can creep up on you when you least expect it:

Monthly maintenance fees: Fixed monthly charges for keeping an account open, regardless of activity.

Per-transaction charges: Fees applied for each deposit, withdrawal or transfer you make from the account.

Minimum balance requirements: You may be charged a fee if you don’t maintain a certain minimum balance in your account.

Excess withdrawal fees: Some banks may charge a fee if you exceed a certain number of monthly withdrawals.

International transaction fees: If your business makes or receives international payments, you may be charged a fee for each transaction.

Wire transfer fees: Banks may charge a fee for sending or receiving wire transfers.

Returned cheque fees: You may be charged if your cheque is returned for insufficient funds.

Inactivity fees: Some banks may charge a fee if your account is inactive for a long period of time.

Even just a few of these costs will quickly eat into your profits if you’re not careful. They can be difficult to track, especially when multiple charges are within one account.

The smartest move is to look for a business bank account that comes with a single, transparent fee that the bank clearly explains upfront. This will help you avoid surprises and keep your business finances on track.

How many bank accounts should a business have?

How Can I Get
a Free Business
Banking Account?

For a small business on a budget, a free business account, is extremely helpful, as there are no start-up costs or monthly fees to worry about.

But free shouldn’t mean basic. Some free business accounts come with extra features that can help your business optimise financial management.

Lula’s Free Business Account is a prime example. Specifically designed for established businesses with basic banking needs, here’s why it stands out:

100% free: No monthly fees, no charges for your first physical card, free swipes locally and abroad, free virtual debit cards, and free transfers between Lula accounts. (You only pay a small fee (R3) for EFTs made to other bank accounts.)
Power up your cash flow: Lula goes beyond just free transactions. You also get access to Lulaflow, the cash flow management tool designed to give you insights and manage your cash flow.
1.5% annual interest on your account balance: Earn while you sleep with our interest rate.
Fast and easy: Open your account in minutes, no branch visits or paperwork required. Plus, you get an instant virtual card for immediate use.
Funding options: Lula makes accessing business funding simple – a crucial advantage if you’re seeking growth capital.

With a free account like the one offered by Lula, early-stage businesses can focus on growth, without having to worry about unnecessary banking fees.

how many bank accounts should I have for my business?

How Can I Grow
My Business with
a Bank Account?
Take it to the next level with Lula’s Unlimited Account

If your business has more complex banking needs, then you’re probably looking at expanding your operations to stay ahead of the competition.

Lula’s Unlimited Business Account is perfect for this.

Designed to simplify your finances so you have more time and money to concentrate on growth, it comes with a suite of advanced business banking tools, including:

Unlimited free electronic fund transfers (EFTs) so that you can process a high volume of transactions without worrying about building costs.

Automatic syncing to your other accounts for a real-time view of your cash flow, even sending smart alerts to prevent shortfalls.

Dedicated human support that listens to your concerns instead of sending you a robotic automated response.

Unlimited free EFTs. Dedicated support. Powerful cash flow management. All for a simple fixed monthly fee of R500 that’s easy for you to keep track of.

How many bank accounts should a business have?

How Long Does it Take to Set up a Business Bank Account with Lula?

Running a business is all about efficiency, and that includes your finances.

Forget wasting time at traditional banks with endless paperwork and slow processing.
With Lula, you can open accounts as easily as checking your email.

Free or Unlimited: minutes, not days

Whether you choose the Free Business Account or the feature-rich Unlimited Business Bank Account, Lula gets you up and running in just a few minutes.

No appointments, no long queues, just a quick online banking application.

Simple steps, big results

If you’re applying for an Unlimited Business Bank Account, all you need is basic information, proof of residence (a recent bank statement works), and your business registration documents from CIPC.

No need for notarised copies or signature samples – just a quick selfie
and a picture of your ID.

Focus on what matters: your business

Lula cuts through the red tape so you can focus on what matters – running your business.

Ditch the wait and frustration of traditional banking. Open your Lula Business Bank Account today and experience the difference.

Trusted by business owners like you.

With Lula there is a certain amount of trust that they place in you. They have faith in you.

I love the trust element between myself and Lula – knowing that I'm going to get my cash as soon as I put in my request.

The great thing is that the whole transaction was done in 5 minutes. Lula understands my business.

What we liked about Lula is that the process for application was extremely easy. Within a couple of hours, we were approved.

Lula has enabled me to expand my product offering, buy equipment and, as a result, create jobs in my community.

The biggest challenge we face is access to cash. What Lula has enabled me to do is take that worry about cash flow away.

Having easy access to cash is probably one of the most important things, that’s where Lula comes in.

How Many Bank Accounts Should
a Business Have?

Get up to R5 million in business funding in 24 hours.

How Many Bank
Accounts Do Most
Businesses Have?