Ally is a hugely popular online bank that offers checking and savings accounts as well as auto loans and mortgages. Regularly appearing on lists of the best online banks, Ally is known for its high-yield savings accounts where you can earn an APR that is 20 times the national average.
If you’re a fan of the bank and are a business owner or freelancer, you’re likely looking to open an Ally business checking account. However, the online bank doesn’t have a business option.
Read on to learn about Ally bank and what business account alternatives are available.
What makes Ally so appealing
If you want to open Ally business account, it’s easy to understand why.
Ally is an online bank, meaning there are no branches to visit. Instead, you can open a checking or savings account online, deposit checks remotely, and transfer money electronically. You can even transfer money with your voice through Amazon’s Alexa.
For its checking option, there are no monthly maintenance fees, no minimum opening deposit, and incoming wire transfers are completely free — three outstanding features that would be useful for business owners.
Can I use an Ally personal account for my business?
Unfortunately, there isn’t an Ally business checking account option; Ally only offers personal accounts.
You may be thinking about opening an Ally account and using it for your business anyway. While it’s technically possible to use a personal checking account for business if you’re a sole proprietor, it’s not a good idea.
If you use a personal checking account for your business, your accounting can become a nightmare and you could run into trouble at tax time. If the IRS decides to audit your business, they’ll be able to review your personal accounts, potentially causing your income to be overstated — and leading to a higher tax bill.
It’s also harder to receive payments from clients. Personal accounts usually can’t connect to credit card or debit card payments like business accounts can, which can cause issues when clients try to pay you.
Finally, keeping a separate business account rather than a personal one may affect your legal liability. If your business runs into trouble or is part of a lawsuit, the only assets that can be compromised are your business assets. But if you run your business from a personal checking account, the line between your personal and professional finances becomes blurred, and you could be personally liable.
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3 Ally business checking account alternatives
Although Ally doesn’t offer a business checking option, there are other banks out there that offer low fees and convenience. Here are our three favorite business checking account options:
1. Best online bank: Azlo
Like Ally, Azlo has no minimum opening deposit for a business checking account, and there’s no minimum monthly balance.
There are also no maintenance fees or transaction fees, regardless of your account balance. You can manage your account online or through the mobile app, and you can send digital invoices and receive payments through Stripe if you sync it with your Azlo account.
Azlo easily connects to QuickBooks and PayPal, helping you better manage your bookkeeping and simplifying your business taxes.
2. Runner-up online bank: Bank Novo
Bank Novo is designed for entrepreneurs on the go, allowing you to manage your account completely from your smartphone. There’s no minimum balance for a business checking account, and your Novo business debit account is accepted worldwide.
You can deposit checks and make payments directly from your phone, and you can send electronic transfers or mail paper checks without having to worry about any fees.
3. High-yield business savings: Citi
For a high-yield business savings account, consider the CitiBusiness Savings account. There is no minimum required deposit, and you can make an unlimited number of deposits each month. Plus, you’ll earn a competitive interest rate on the money you save.
Unfortunately, you can’t open a CitiBusiness Savings account online. Instead, you have to visit a branch in-person. Accounts are only available to business owners in Los Angeles (CA), Orange County (CA), Riverside (CA), San Diego (CA), San Francisco (CA), Miami (FL), Chicago (IL), Baltimore (MD), Las Vegas (NV), New York City (NY), and Washington, DC.
Frequently asked questions about Ally
Here are some of the most commonly asked questions about banking with Ally:
1. Does Ally offer business checking accounts?
Unfortunately, Ally doesn’t currently offer business checking accounts or business savings account. It only has personal accounts, so you’re better off working with another bank for your business needs.
2. Can you use a personal checking account for business?
While you can technically use a personal checking account for business purposes if you’re a sole proprietor, it’s not recommended. It opens you up to legal liability and tax issues that could cost you over the long run.
Instead, open up a dedicated business checking and savings account with a bank — either online or traditional — that caters to small business owners.
3. What is the best free online business checking account?
When it comes to the best online business checking accounts, Azlo stands apart. With no minimum balance required and no monthly maintenance fees, you can easily manage your cash flow and enjoy its benefits.
4. What is the best business savings account?
If you’re looking for the best business savings account, check out CitiBusiness Savings. You’ll earn a competitive interest rate, and there’s no minimum required deposit.
Opening a business checking account
If you’re thinking of opening a new business checking account, you may be disappointed to find out that Ally business checking isn’t an option. Luckily, there are a number of other business banking options that offer the same level of convenience that Ally has, with low minimums and low fees.
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