An alternative business bank account without credit checks

Starting a business is hard enough in itself, but if you have a bad or adverse credit history that task becomes all the more difficult, as all high street business bank accounts require the business owner to undergo a credit check.

Some digital companies have taken advantage of this and have developed new products for businesses. These digital challengers, don’t require a credit check, making it easy to get an account up and running. Perfect for those bad credit histories, or even businesses with foreign directors who might not have a credit history in the UK.

Previously, we took a look at the Cash Plus business account, this time we turn our attention to the Card One Money account.

According to Card One Money, the business ‘bank‘ account is specifically designed for small business, and offers telephone and online banking. There are no credit checks, you just need to prove your address and identity, and pay the application fee, which is refundable if your application isn’t successful. The new account can be up and running in minutes, making it great for those who can’t wait to start taking payments.

The account holder will receive a Mastercard debit card, with a maximum of four additional cardholders able to be added to the account (albeit at a cost).

What can I do with the account?

  • Receive and make electronic payments in your business’ name
  • Setup standing orders and direct debits (coming soon)
  • Pay in cash (via Post Office, and Barclays Branches)
  • Pay in Cheques (via Barclays Branches)
  • Withdraw money
  • Access online banking
  • Set up direct debits
  • Receive international payments

What can’t I do?

  • Write cheques (but you can deposit them)
  • Visit a branch (there are none, but customers can use Barclays or the Post Office)

How much does it cost?

There’s an initial application fee of £55 (refundable if the application is rejected), and an on-going monthly charge of £12.50, making this account a fair deal more expensive than the CashPlus option, but still reasonable. Bear in mind, that most traditional bank accounts have a cover charge ranging from £5-10 per month which equates to £60-£120 per year anyway.

In addition to the costs above, the account also carries charges for electronic credit (30p), Faster Payments (£7.50), standing orders (£0.30), and a myriad of other fees, so make sure you’re aware of what exactly you’ll be charged for and work that into your business planning.

Just as with other banking fees, all of these costs can be offset against tax, reducing your liability for the year incurred.

Who can apply?

All applications from limited liability companies (with a turnover of less than £2m) are likely to be accepted even if the director(s) have former defaults, CCJs, or satisfied bankruptcies. Soles traders, and partnerships are also eligible to apply. As there’s no credit check, this account could be a lifeline for those looking to open a business bank account but have been prevented doing so by a poor credit history.

Our verdict

We used to consider these type of card based business ‘bank’ accounts as a last resort, but they’ve improved over the years, and now rival many of the traditional highstreet bank accounts.

For those that have exhausted other avenues, card based accounts can be the difference between getting your business up and running, or falling at the first hurdle. The ability to pay is cheques could make this winner as it’s not something the other digital challengers offer.

If however, you don’t need to pay in cheques, or use Barclays branches, the Card One Money Account offers little over its competitors.

The good

  • No credit check
  • Online banking
  • UK call centre
  • International payments
  • Open an account in just three hours
  • pay in cheques

The bad

  • £55 application fee (refundable)
  • £12.50 monthly fee
  • No chequebook

Apply for a Card One Money account

2 Comments

  • neada busaccount

    its offers more than mycash plus as you can pay in by cheque

  • Updated Info

    Seems debit orders and standing orders are now available according to the website. (Sept 2014)

    Has anyone used them yet and have any feedback?

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