What UK owners are actually opening
Branch visits stopped being the default some time ago. Starling alone reports more than 450,000 business customers, and Monzo, Tide and Revolut all let you apply from a phone in minutes rather than weeks. The high street has not stood still either. HSBC's small business account carries no monthly fee, and its established-business account opens with 12 months of free banking. NatWest's app-only Mettle sits at £0 a month with FreeAgent thrown in.
So far, so generous. The catch is rarely the headline number. It is the line items underneath, and the way each provider defines a "free" transaction differently. An online business bank account in the UK is now a fee schedule with an app attached, and the owners who do well out of it are the ones who read that schedule before signing up.
Three places the cost hides
1. Details that do not match the register. Most delays come from paperwork, not credit checks. A limited company's name must match Companies House exactly, including punctuation. Sole traders need their HMRC registration to hand. These are the kinds of details that stall an application for a fortnight. It is a familiar story: a Sheffield builder applies under his trading name rather than the registered one, waits eleven days, and starts again. The fix is dull. Put your certificate, your UTR and a proof of address dated within three months side by side before you open the app.
2. Payments, not subscriptions. Tide's free plan charges £0.20 for each transfer in and out. Sixty incoming payments a month is £12 before you have paid for anything else, which is roughly the price of its Smart plan at £12.49 plus VAT. Prices quoted without VAT matter if you are registered, because £12.49 becomes £14.99 on the invoice. Starling and Monzo both charge nothing for UK Faster Payments. Revolut Business runs from around £10 to £90 a month depending on tier. Add up your expected transactions, not your turnover, and the ranking often changes.
3. Cash and cheques. This is where app-only accounts split sharply. Mettle does not accept cash deposits at all, which rules it out for a market stall or a café till. Starling takes cash at the Post Office for 0.7%, with a £3 minimum. Tide charges £2.50 or 0.5% at the Post Office and 3% at a PayPoint, plus £1 per ATM withdrawal. If cash is 20% of your takings, those percentages decide your provider for you.
There is a fourth question worth asking: what happens if the provider fails. Some accounts sit inside the UK deposit protection scheme, others only safeguard client money with a partner bank. Both are legal, but they are not the same promise. Ask directly, in writing.
Comparing the realistic options
| Provider | Monthly fee | Suits | Watch for |
|---|
| Starling Business | £0 | Everyday UK payments, clean app | Cash at 0.7%, £3 minimum |
| Tide (Free) | £0 | New sole traders | £0.20 per transfer, £1 per ATM |
| Tide (Smart / Pro / Max) | £12.49 / £24.99 / £69.99 + VAT | Growing firms, invoicing | VAT on top, add-on pricing |
| Mettle (NatWest) | £0 | Limited companies using FreeAgent | No cash deposits, no overdraft |
| Monzo Business (Lite / Pro) | £0 / £5 | Simple bookkeeping, tax pots | Check transfer terms, plan limits |
| ANNA Money | £0 PAYG, £19.90 or £49.90 + VAT | Micro-businesses wanting tax tools | Commission on money coming in |
| Revolut Business | Approx. £10-£90 | International trade | Tier pricing, e-money status |
| High street (HSBC, Barclays, Lloyds, RBS, NatWest) | £0 to around £120 annual account fee | Cash, lending, branch support | Charges resume after free periods |
The high street figures deserve a note. Introductory free banking is a genuine saving, usually for 12 months, but it ends without much warning. Barclays and several others sit around the £100-£120 mark annually once standard pricing applies, while NatWest's business current account remains at no monthly fee.
How to apply without losing a fortnight
Start with the paperwork, not the app. Pull together your Companies House or HMRC registration, a director's photo ID and one address document from the last three months. Photograph them in daylight; blurry scans are a common reason for a second review.
Then count real activity. Take the last three months of statements and totalled up every incoming payment, every cash drop, every card payment abroad. Run those figures against two fee tables. A freelance designer in Bristol sending twelve invoices a month and a Lincolnshire farm shop banking £4,000 in cash weekly will not reach the same answer, and neither should they.
Decide on borrowing early. Mettle offers no overdraft or lending, which is fine for a cash-positive consultancy and a problem for a firm bridging stock purchases. High street accounts come with credit options and a relationship manager, at the cost of more paperwork and less useful software.
Use the switching service where it applies, but run both accounts in parallel for a month. Direct debits and payroll rarely move as neatly as the marketing suggests, and a duplicate payment to a supplier is an expensive lesson.
Local support is free and underused. The Business Growth Hub network in Greater Manchester and the Leeds City Region Enterprise Partnership both run finance sessions. Business Gateway covers Scotland, Business Wales and Invest NI cover their nations, and the British Business Bank publishes plain-English guidance on finance options. The Post Office counter is also worth a visit before you commit, since it is the cash route for several app-based banks.
Before you fill in the next form
The right account is not the one with the best app store rating. It is the one whose fee schedule matches how your business actually moves money each week, and whose registration requirements your paperwork already satisfies. Getting that pairing right saves a few hundred pounds a year and a great deal of admin.
Try this: take your last three months of transactions, pick two providers from the table above, and score each against your real numbers rather than the advertised headline. The one that survives the arithmetic is the one to apply to.
If you would rather not do it alone, book a free session with your regional growth hub first. They see enough applications to spot the mistake you are about to make.
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