December 6, 2021
By Melissa Buening
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Finding a bank for your ecommerce business can be challenging, especially if you're starting your business with $0. Banking has come a long way in the past few years when it comes to online options. There are now online banking options that allow you to apply online, manage your account online, and require no deposit or a small deposit to open your account.
I searched high and low for the best online banks for my businesses during the pandemic because I couldn't go to a physical bank to open an account. After doing a lot of research, I decided to open business accounts with Novo and Mercury. Both online banking solutions allowed me to apply online and manage my accounts completely online. Below, I'll show you the features of each online banking solution and what is included in the various types of accounts.
Novo offers free business checking accounts that you can apply for online and manage online. Novo's FDIC-insured checking accounts include free ACH transfers, free mailed checks, and free incoming domestic and international wires. There is no minimum deposit required to open an account with Novo, but if you want to unlock all of Novo's features, then they request a $50 deposit. Once you open your account, there is no minimum balance required. Novo will send you a physical debit card in the mail after you open your account. I'll go through how to create invoices through Novo, Novo Reserves, Novo's Perks, and Novo's App Integrations below.
You can invoice your customers directly from Novo. This is helpful if you are selling products wholesale. When you create an invoice, you can choose an invoice number, fill in the customer's name, email, and company name, set payment terms, add other recipients, add billable line items, and select payment options. The payment options that are available for invoices are bank transfer (ACH) and credit/debit card via Stripe. You must have a Stripe account in order to use the Stripe integration. As an added "Perk" for Novo customers, new and existing Stripe users can receive $20,000 in fee-free card processing.
With Reserves, you can set aside funds so that they aren't available in your checking account. Typically, you would want to set aside funds for things like payroll, taxes, and other large expenses. You can create 5 Reserves in a Novo account.
At the time of writing this, Novo has 11 Perks for customers. Each Perk is a discount of so me sort for other products/tools. The current Perks are:
Novo integrates with several apps. Some of the integrations allow you to see the performance of your online store in your Novo account, see your balance and status of your payouts from your payment processor in your Novo account, and automatically populate your transactions from your Novo account to your online accounting software. I'll walk you through four of the integrations below: Stripe, Shopify, Square, and QuickBooks Online.
Novo's Stripe integration allows you to see your s ales, balances, and payouts from Stripe in your Novo account. This can help you understand your cash position at-a-glance. The integration also allows you to accept card payments on invoices you send from your Novo account.
Novo's Shopify integration allows you to view your Shopify balance and the status of your payouts in your Novo account. Month-to-date performance of your online store is also shown in your Novo account via the integration.
Novo's Square integration allows you to see in Novo when your Square funds are on the way to your bank account and view the month-to-date performance of your online store in Novo.
Novo's QuickBooks Online integration allows you to automatically populate transactions from your Novo account into your QuickBooks Online account. This can help you save time because you won't need to manually export transactions from Novo and import them into QuickBooks Online.
The second online banking solution I'll introduce you to is Mercury. You can set up free FDIC-insured accounts for your business using Mercury. You apply online and manage your accounts online. All accounts include checking and savings accounts and a debit card and virtual cards. There is no minimum deposit required to get started with their Standard account. They also offer a premium account called Tea Room which requires a $250K minimum deposit. I'll go over the differences between a Standard account and Tea Room account below as well as partner perks, virtual cards, how to invite team members, and integrations.
Standard accounts include free checking and savings accounts, free debit card, free sending and receiving domestic wires, free sending and receiving international wires, free sending and receiving ACH, and no minimum balances. Sending and receiving checks are also free. There's no minimum depost and there are no monthly fees and no overdraft fees. After you set up your account, Mercury will send you a physical debit card in the mail.
Tea Room accounts include free checking and savings accounts, free debit card, free sending and receiving domestic wires, free sending and receiving international wires, free sending and receiving ACH, dedicated phone support, access to Tea Room events, and tea sent to you when you join. Yes, they really send tea! Sending and receiving checks are free. The minimum deposit for a Tea Room account is $250K. There are no monthly fees and no overdraft fees. A physical debit card will be sent to you in the mail after you set up your account.
Mercury has special deals available on tools you can use for your startup. The perks available for Standard accounts is more limited than Tea Room accounts, which is an added benefit of having a Tea Room account. There are deals for accounting tools, advertising tools, communication tools, developer tools, ecommerce tools, finance tools, funding tools, hosting tools, HR tools, incorporation tools, insurance tools, productivity tools, sales and marketing tools, security tools, and other miscellaneous tools. The deals are pretty fantastic. Check out Mercury's Partner Perks here.
You can create virtual debit cards with spending limits instantly with Mercury. Virtual cards are useful for keeping your payments for different vendors separate. For example, if you want to use one virtual card to pay for your Facebook ads, you can set spending limits on the card to make sure you stay within your budget.
Mercury allows you to invite team members to your account. Admins have full access to all accounts, Bookkeepers have full access to read-only, card only users can only access their cards and can't view accounts or access company settings, custom users can view accounts but can't access security settings or manage the team. You can also choose if you want a custom user to move money with approval, move money without approval, or not have the ability to move money.
Mercury has direct integrations with QuickBooks Online, Xero, and Zapier. QuickBooks Online and Xero are both online accounting software. Zapier is automation software that allows you to connect Mercury with other apps you use. For example, if you use FreshBooks for your accounting and want to automatically create a new expense in FreshBooks when a transaction settles in Mercury, you can set up a zap in Zapier for that.
When choosing a business account provider, it's important to consider what your business will require to operate, what tools you currently use or will use in the near future, the cost savings to your business for taking advantage of perks your business account provider offers, and the potential time/cost savings for you and your business as a result of your business account provider's pre-built integrations.
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