December 19, 2024

Best Banks for Small Business in California

By Alyssa Supetran
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The right bank can help you navigate California's diverse business landscape. Discover the top 10 banks that can help your small business succeed.

What is the best bank for small business in California?
Here are the 10 best banks for small businesses based in California:
  1. Bank of America for flexibility
  2. Chase Bank for built-in credit card processing
  3. Wells Fargo for SBA loans
  4. U.S. Bank for national bank with free checking
  5. Capital One for unlimited fee-free transactions
  6. Tri Counties Bank for tailored solutions
  7. Hanmi Bank for local community bank
  8. Bluevine for high-interest checking accounts
  9. Axos Bank for minimal fees
  10. Relay for multiple checking accounts

California has more small businesses than any state. It's home to over 4 million small businesses, which is 99.8% of all businesses in the state.[1]

Whether you're a startup or a growing company, choosing the right bank can make all the difference. Fortunately, the Golden State offers a wealth of banking options - from national names like Chase to local favorites like Tri Counties Bank.

Read on to find your perfect financial partner.

10 Best Banks for Business Accounts in California

These banks have the resources and expertise to help your business navigate California's dynamic and competitive market. Whether it's a new venture in Los Angeles or an expansion to San Francisco.

Also check out these California financial programs designed to support and incentivize small businesses in different industries.

Which banking service do you need for your small business in California?

Bank of America

Best for: Flexibility; cash management

Bank of America is one of the largest brick-and-mortar banks in the United States. It has a massive footprint in the Golden State, with over 740 financial centers across 350 areas, mostly in Los Angeles, San Diego, and San Francisco.

Bank of America offers a unique flexible Business Advantage Banking account with two tiers you can switch between. The basic tier is an ideal starting point, thanks to its low requirements. You can seamlessly move up or down as your business needs change.

It also has better digital tools than other basic accounts. With their Cash Flow Monitor®, you can connect to apps like QuickBooks and Expensify to track your business metrics all in one place. Plus, get cash flow projections to help you plan for possible shortfalls.

If you need help with anything, Bank of America's team of Small Business Specialists is ready to provide valuable advice and hands-on support whenever you need.

Pros:

  • Flexible business checking
  • Built-in cash management tools
  • Access to Small Business Specialists

Cons:

  • Less access to SBA loans
  • Many banking fees like overdrafts and wires

Do you take credit card payments? This next bank will make payment processing a breeze.

Chase Bank

Best for: Built-in credit card processing

Chase Bank is another national bank with a large range in California. It has 900+ branches across the state, so finding a branch is easy if you prefer banking in person.

Chase is a great option if your small business accepts credit card payments from customers. It's good for small retail stores, restaurants, and service-based businesses.

The Chase Business Complete Banking account includes built-in credit card processing. No need for a separate merchant account.

And with the QuickAccept feature, all payments are deposited into your account on the same day. So you can keep your cash flow moving and prevent business interruptions.

Chase also has excellent customer service and a wide selection of business products. In particular, its popular business credit cards give generous cashback and travel rewards.

Chase Bank often offers new customers bonuses for opening business bank accounts. Check back regularly to see current promotions.

Pros:

  • Checking with built-in payment processing
  • Highly rated mobile app
  • Unlimited electronic transactions
  • Offers promotions for new customers

Cons:

  • Many banking fees
  • Low interest rates

As your business expands, you may need more capital. This next option could help you achieve the growth you need.

Wells Fargo

Best for: SBA loans; extensive business services

Wells Fargo is a financial giant deeply rooted in California with over 800 branches in the state. You'll find most of them in Los Angeles, San Diego, and San Francisco, where its headquarters are.

Wells Fargo offers a comprehensive suite of business products, including banking, insurance, payroll services, and more—all under one roof.

Need capital to start or grow your business? Wells Fargo is one of the country's top SBA 7(a) lenders. It can help you secure small business loans quickly with more favorable terms, such as longer repayment times or lower interest rates.

For business checking, the Initiate Business Checking Account is a great starter account for new businesses with less activity. As your business grows, you can easily upgrade if you need more features.

Pros:

  • Top SBA lender
  • Comprehensive small business services
  • Several business checking options

Cons:

  • Many banking fees like wires and overdrafts
  • Low interest rates for savings accounts

If you're a new business with inconsistent cash flow, a bank with free checking can help you keep more in your pocket.

U.S. Bank

Best for: National bank with free checking

U.S. Bank is one of the country's largest banks with over 580 physical locations in California.

If you prefer a larger bank with fewer fees, US Bank is an excellent choice. Its Silver Business Checking Account has no monthly fee or minimum balance requirements. Just note that you're limited to 125 free transactions per statement cycle, then $0.50 each, so it's best for newer businesses with less activity.

And if the Silver account doesn't have what you're looking for, U.S. Bank has four other business checking accounts, including one tailored for non-profits.

All accounts come with convenient online and mobile banking tools, allowing you to monitor cash flow, transfer money, deposit checks, and more—whenever, wherever.

In addition to 4,700+ U.S. Bank ATMs across the country, you can also withdraw surcharge-free at approx. 40,000 MoneyPass® ATMs. So even if you don't live near a branch, ATMs are still convenient.

Pros:

  • Free checking option
  • Specialty checking accounts available
  • Extensive ATM network for no-fee withdrawals

Cons:

  • Limited fee-free transactions
  • Fewer features than others

Capital One

Best for: Unlimited fee-free transactions

Capital One is a popular hybrid physical/online bank with 262 branches across the country. While there's no branch in California, it's still worth considering for small businesses.

Capital One can be a great option for highly active businesses. It gives you unlimited free transactions for deposits, withdrawals, and money transfers. Process all business transactions without worrying about it becoming too costly.

Plus, enjoy free withdrawals at any of the over 70,000 no-fee Capital One, MoneyPass, and Allpoint ATMs nationwide.

In addition, Capital One has a wide selection of other banking products designed specifically with small businesses in mind. You can get business credit cards, savings accounts, and credit card processing services all from one bank.

Pros:

  • Unlimited free transactions
  • Extensive ATM network
  • Wide selection of small business banking products

Cons:

  • High waiver requirements for monthly fees[2]">

What kind of bank do you want to use for your small business?

Starting a local business? While national banks offer convenience, sometimes a smaller community bank provides that local touch you need.

Tri Counties Bank

Best for: Tailored business banking solutions

Tri Counties Bank is a good option if you want to work with a smaller local bank. It has 60+ branches across California and more than 40,000 surcharge-free ATMs nationwide.

It prides itself on offering tailored banking solutions to businesses in California. This includes five different checking accounts for businesses of all sizes. It also has specialty accounts for businesses in specific fields, like lawyers or government entities.

Tri Counties Bank also has a good selection of other business banking products. You can find merchant services, treasury management, small business loans, and more. It can even help you set up pension plans for your employees.[3]

Trico Business Express is its user-friendly online platform that helps you manage your finances more efficiently. Use it to view your transaction history, account balances, ongoing transfers, etc. You can even generate custom reports and personalize employee access.

Pros:

  • Strong local presence
  • Tailored business banking solutions
  • Easy-to-use online platform
  • Good selection of business banking products

Cons:

  • More limited footprint
  • In-person application required

Hanmi Bank

Best for: Local community bank; customer service

Hanmi Bank was initially founded to serve the local Korean-American community in Los Angeles. But it has since evolved to accommodate all business owners in California and 8 other states.

With four business checking accounts, Hanmi Bank can cater to different needs, whether you just need simple checking or an all-in-one banking solution. The Advantage and Elite checking accounts even come with built-in payment processing.

What's more, it has specialty lending options for businesses in specific industries, such as entertainment and healthcare. It can help you get that much-needed funding more easily by guiding you through the requirements and processes.

Hanmi Bank focuses on building long-lasting relationships with its clients, so it's a great choice if you're looking for personalized service. You can easily reach its team by phone, through email, or in person.

Hanmi Bank has a dedicated support team for clients working with Korean companies called "Korea Desk." They offer support in both English and Korean, so you can check out its services without worrying about the language barrier.

Pros:

  • Specialty lending options
  • Personalized customer service
  • Good rewards program
  • Checking options with built-in payment processing

Cons:

  • Limited locations in California
  • Higher requirements to waive monthly fees

Don't need in-person banking? Consider an online account for more features and benefits.

Bluevine

Best for: High-interest checking accounts

If you don't mind an online-only option, Bluevine is a great alternative to traditional brick-and-mortar banks. It stands out with its high-yield business checking and flexible lines of credit.

Even at the basic tier, you earn up to 1.5% APY on balances up to $250,000 with monthly eligibility requirements; 0% APY on balances over $250,000. And there's no monthly fees, minimum balance requirements, or overdraft fees.

Plus, you can open up to 5 free sub-accounts with their own account numbers. This allows you to better organize your funds and set budgets for things like payroll, taxes, and vendor payments.

You can even set custom rules and permissions for better security and account management. All sub-accounts also earn interest up to the combined maximum.[4]

Need some extra funds to ride out a slow season or grow your business? Bluevine also offers a flexible business line of credit up to $250,000.[5] Decisions take as little as 5 minutes, so you can keep moving forward.

Pros:

  • High APYs on checking balances
  • Up to 5 sub-accounts
  • No monthly fees
  • Free withdrawals at approximately 40,000 MoneyPass ATMs

Cons:

  • No physical branches
  • Fees for cash deposits

Bluevine is not a bank. It partners with Coastal Community Bank, Member FDIC, and a trusted network of program banks to provide FDIC insurance up to $3 million.

Axos Bank

Best for: Minimal fees; free basic business checking

Axos Bank is headquartered in San Diego, California. It was founded in 2000 as a digital bank, originally named Bank of Internet USA, to offer customers better, less costly products and services. It is fully FDIC-insured.

Axos is a full-service online bank, so it has no physical locations. But it's still a solid option for small businesses in California, especially if less fees sound good to you.

The Basic Business Checking account has no monthly fees and gives you unlimited free transactions for deposits, withdrawals, and incoming wire transfers. You also get up to two outgoing domestic wire reimbursements monthly.

Need to withdraw cash? Just use any ATM you want. You get unlimited domestic ATM fee reimbursements nationwide. You can also make cash deposits at participating machines.

Axos customer support is available 24/7 so you can reach out anytime—even after normal business hours.

Pros:

  • Free business checking option
  • Minimal fees
  • Unlimited domestic ATM fee reimbursements
  • Dedicated customer support

Cons:

  • No physical branches
  • Limited support hours for non-clients

Growing your business? This next one is a great option if you have a growing team.

Relay

Best for: Multiple checking accounts; digital tools

Running a growing online business in California? Relay is a powerful digital banking option to streamline your financial management, particularly for teams with greater checking needs.

You can create up to 20 checking accounts for free and get up to 50 debit cards.[6] This allows you to allocate accounts for specific purposes and make managing your business's cash flow easier.

If you have a team, you can assign user permissions for each account. Free up your time by having your team help pay bills, make purchases, deposit checks, and more.

Relay integrates with your favorite business apps, like QuickBooks or Gusto - making accounting and tax season less time-consuming and stressful.

In addition, Relay has built-in tools that let you automate banking processes. For example, you can set up auto-transfer rules. And the Pro account even offers accounts payable automation.

Pros:

  • Up to 20 free checking accounts
  • Up to 50 physical and virtual debit cards
  • Built-in digital banking tools
  • Native integration with popular business apps

Cons:

  • No physical branches
  • Long processing times for check deposits[7]

Relay is a financial technology company, not an FDIC-insured bank. Banking services and FDIC insurance are provided by Thread Bank; Member FDIC. Your deposits qualify for up to $3,000,000 in FDIC insurance coverage.

How to Choose the Right Bank for Your Business?

Before committing to a bank, be sure they have the features you're looking for. Consider these:

  • Monthly fee & minimum balance
    Some banks require that you maintain a minimum balance in your account. If you don't, you'll have to pay a monthly fee. See if the requirement makes sense for your business. Some of our listed banks have no minimums and no monthly fees.

  • Monthly transaction limits
    Most business checking accounts cap the number of free transactions your account can do monthly. Then a fee is charged for each one after that. Pick an account that can accommodate your transaction volume.

  • Cash deposits
    Does your business deal with a lot of cash? Most accounts offer fee-free cash deposits up to a certain amount per month.

  • Accessibility
    Most of the banks on our list have a good number of branches and ATMs in California. However, it's still best to check the availability of your chosen bank in your area, and how convenient it would be for you on a day-to-day basis.

    You can also try online-only options like Bluevine or Axos if you don't need a physical branch. They usually offer better fees and higher rates compared to brick-and-mortar banks.

  • Small business loan options
    Sometimes, it's easier to get a loan from the same bank you use for checking since you have an established relationship. See what loan options the bank has and their terms.

  • Customer support
    You should be able to get help as soon as you need it. Get a sense of the bank's customer service for small business owners. Some banks have small business specialists who can give you more tailored guidance.

  • Mobile app
    Many business owners bank on the go. Having a reliable mobile banking app is a must.

  • Software integration
    Does the bank integrate with any accounting software, like QuickBooks, Freshbooks, or Xero? This helps save time and hassle when it comes to bookkeeping and tax reporting.

What's most important to you when choosing a small business bank?

Why Have a Business Bank Account

It's important to separate your business finances if you have an LLC or corporation in California. Doing so helps protect your personal assets if your business gets sued or has unpaid debt.

While this isn't a requirement for sole proprietors, having a separate business bank account will make your life easier.

Here's why you should have a business bank account:

  • Easier to calculate business expenses during tax time.
  • Makes the business look more professional to your customers and vendors.
  • Be able to apply for business loans.
  • Pay bills and make purchases from your business funds.
  • Allows you to accept credit card payments from customers.

What kind of bank account should I open for my small business?
Your business should have at least a checking account. It's what you need for day-to-day operations like paying bills, receiving deposits, and making purchases. If your business has extra funds, you can open a business savings account to save for emergencies and future plans.

Our Methodology

To come up with the best banks for small businesses in California, we first pinned down banks with a strong presence in the state. So, you'll be able to find branches or ATMs easily wherever you are.

Then we looked into the banks' fees, account features, and other business services. We chose banks that either have a free business checking option or reasonable terms to waive the monthly fees.

We also looked for unique banking features, like built-in payment processing, cash flow tools, or specialty lending options. That way, no matter what kind of business you have, you'll find a bank that fits your needs.

FAQs

Do I need a California ID to open a business bank account in California?
Yes, most banks in California will require proof of residency to open a business bank account. Some examples include a California driver's license, business license, or business registration.

What is the minimum to open a business account?
The minimum amount needed to open a business account can range anywhere from $0 to $1,000. It differs from bank to bank, so it's best to check with your preferred bank to be sure.

Can I open a business bank account with bad credit?
Banks generally don't do a credit check when you open a checking or savings account. So it's possible to open a business bank account, even if you have low personal credit.

Keep in mind that banks may check your ChexSystems report. So if you've had problems with your personal banking account, that may still impact your ability to open a business banking account.

Can I use a regular bank account for my small business?
It's best to have a dedicated business bank account for your small business. Aside from personal liability protection, it also helps keep your finances organized.

Bottom Line

If you're one of the millions of entrepreneurs trying to make it big in the Golden State, finding the right banking partner will be crucial to your success.

Bank of America and Chase are great choices if you're looking for an established national bank with comprehensive services. Tri Counties Bank is also a solid option if you want local support and tailored banking solutions.

Take the time to identify your company's unique needs and see if any of the listed banks is right for your business.

References

  1. ^ U.S. Small Business Administration Office of Advocacy. 2023 Small Business Profile, Retrieved 08/05/2024
  2. ^ Capital One. Business Checking, Retrieved 12/19/2024
  3. ^ Tri Counties Bank. Pension and Retirement, Retrieved 08/05/2024
  4. ^ Bluevine. Use Sub-Accounts Effectively, Retrieved 07/04/2024
  5. ^ Bluevine. Line of Credit, Retrieved 09/15/2024
  6. ^ Relay. Business Checking Built For Business Owners | Relay, Retrieved 07/05/2024
  7. ^ Relay. Depositing a Check, Retrieved 07/05/2024

Alyssa Supetran is a research analyst at CreditDonkey, a credit card comparison and reviews website. Write to Alyssa Supetran at alyssa@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

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Best Bank for Small Business

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What kind of bank do you want to use for your small business?
32% National bank
29% Local bank
38% Online bank
Source: CreditDonkey. Totals may not add to 100% due to rounding.
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