The market has changed, and so have the checks
A few years ago the choice was simple: walk into a branch, take what the manager offered. Branches have thinned out since then, and app-based providers have taken a large share of small business banking. What has not changed is the paperwork. Opening an online business bank account in the UK still means proving who you are, what you trade, and where the money will come from.
Three frictions come up again and again.
The first is identity. Directors and people with significant control now need to verify themselves with Companies House and hold a personal code before they can be attached to a company record. Banks check this alongside their own anti-money-laundering questions, so a mismatch between your registered details and your application is one of the most common reasons an account sits in review for weeks.
The second is feature mismatch. A freelance consultant and a market trader need very different things from an account. One wants invoice matching and a tax pot; the other needs to pay in takings on a Saturday afternoon without losing a slice of every deposit. Choosing on brand recognition alone usually ends in a monthly fee you do not use.
The third is protection. Not every app account sits inside the Financial Services Compensation Scheme. Starling, Monzo and Mettle hold banking licences, so eligible deposits are covered up to £85,000 per person. Tide and some Revolut arrangements operate under e-money rules, where your money is safeguarded rather than covered by that scheme. Revolut's UK entity now holds a banking licence, but what applies to you depends on which entity holds the funds, so read the account terms rather than the homepage.
Then there is tax. From April 2026, sole traders and landlords with qualifying income above £50,000 must keep digital records and send quarterly updates under Making Tax Digital for Income Tax. An account that talks to Xero or QuickBooks removes a chunk of that admin; one that exports a clunky CSV does not.
What the main options cost
Prices below reflect published plan information and shift with promotions, so treat them as a starting point.
| Provider | Typical monthly cost | Best suited to | Deposit protection | Main drawback |
|---|
| Starling Business | No monthly fee; optional toolkit around £7 | Sole traders and small limited companies wanting a full bank licence | FSCS, up to £85,000 | Cash deposits cost about £2 each at the Post Office |
| Monzo Business | Lite no monthly fee; Pro around £5 | Owners who want tax pots and simple bookkeeping | FSCS, up to £85,000 | Less suited to heavy cash handling |
| Tide | Entry plan no monthly fee with a per-transfer charge; Plus around £9.99; higher tiers up to roughly £50 | Freelancers who invoice through the app | E-money safeguarding | Transfer charges add up on busy accounts |
| Revolut Business | Basic around £10; Grow £30–£35; Scale £90–£125 | Businesses paying suppliers and clients overseas | Depends on the entity holding funds | Plan allowances are easy to exceed |
| ANNA Money | Pay-as-you-go option; Business around £22.90; larger plan around £59.90 | Very small firms that want invoicing and receipt capture in one place | E-money safeguarding | Support is app-first only |
| Wise Business | One-off setup fee around £45 | Importers, exporters, contractors paid in euros or dollars | Safeguarded, not FSCS | Not a full UK current account replacement |
| Mettle | No monthly fee | Sole traders and very small companies backed by NatWest | FSCS through NatWest | Fewer features than larger rivals |
| NatWest Start-up | No monthly fee for the first two years, then pence per automated payment | New businesses wanting branch access later | FSCS, up to £85,000 | Charges begin once the startup period ends |
Matching the account to how you actually trade
A common pattern among UK freelancers is a designer or consultant turning over somewhere between £30,000 and £60,000, working alone, paid by bank transfer, with a handful of software subscriptions. For that profile, Starling or Monzo Lite usually covers everything. Transfers within the UK are included, the app separates tax money from spending money, and there is no monthly charge to justify. The step that catches people out is forgetting to move existing Direct Debits and client payment details across, which leaves two accounts alive and one of them unfunded.
Limited companies with employees need to think about access before they think about price. You want at least two users, separate permissions for a bookkeeper, and payments that can be approved rather than made by whoever holds the card. Tide's paid tiers and Revolut Grow both handle this; the entry plans often do not. A limited company is also a separate legal entity, so running company income through a personal account creates a paper trail that is hard to unpick at year end and awkward during an enquiry.
Cash-heavy businesses deserve their own calculation. If you take several hundred pounds in notes each week, a 1% deposit charge quietly becomes a real cost. Compare the per-deposit fee at the Post Office against a per-£100 cash charge at a high street bank before signing up, and check whether the nearest branch or Post Office counter is a bus ride away.
For anyone invoicing clients in euros or dollars, a multi-currency business account is usually worth more than a slightly cheaper domestic account. Wise and Revolut publish their conversion margins up front, while Starling charges a percentage on international transfers. Compare the all-in cost of a €5,000 payment, not just the headline monthly fee.
Setting up without the back-and-forth
Work through these in order and most applications clear in a day or two.
- Verify your identity with Companies House through GOV.UK One Login and keep your personal code to hand. Directors cannot be added to a company record without it.
- Confirm your business details match everywhere: registered address, SIC code, trading name, and the turnover figure you expect over the next twelve months.
- Prepare one document showing your address and one showing your business exists, such as a Companies House filing confirmation or a recent invoice.
- Apply to two providers rather than one. A licensed bank and an app-based platform give you a genuine comparison if one stalls.
- Fund the account with a small deposit, then connect your accounting software and set up a tax pot before the first invoice arrives.
- Move Direct Debits, standing orders and card payments across, then close the old account once a full statement cycle has cleared.
Mistakes that cost money later
Chasing a headline monthly price while ignoring per-transfer charges is the most expensive habit in this market. Tide's entry plan, for example, charges per transfer, so a business making fifty payments a month may pay more than it would on a £10 plan elsewhere. Read the transaction schedule, not the plan name.
Another common slip is treating an e-money account as if it were a bank account. Your money is protected differently, and for a company holding a large tax reserve that distinction matters. If your balance regularly sits well above £85,000, split funds across institutions or ask about additional protection.
Finally, do not open four accounts "for sorting". Two is manageable; four means statements nobody reconciles. Tax pots inside one account usually do the job that people open extra accounts to solve.
Start with one application to a licensed bank and one to a platform that matches your cash flow. Run both for a month of real trading, compare the statements, then commit to the one whose fees you can predict. The right online business bank account in the UK is the one that makes your month-end shorter, not the one with the better advert.
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