eCredable Business Blog

eCredable Business Blog


Learn how to build business credit and access more business financing.

Business Checking vs Personal Checking: Which is Right For You?

When starting a business, the IRS suggests having a separate bank account for business purposes to simplify paying expenses and tax management. 

In this post, we’ll break down business checking vs personal checking to help you decide what’s right for you.  

Difference 1 - Business Paperwork is Needed to Open a Business Checking Account

One key difference between a business checking account and a personal checking account is the amount of paperwork required to get set up. 

Because a personal bank account is used for everyday finances, it’s generally quicker and easier to set up than a business bank account.

With a personal account, for instance, you usually just need two forms of government ID and proof of address. It can also be set up without any extensive paperwork. 

But with a business checking account, you need more documentation.

According to the SBA, this typically includes an EIN (if you’re part of a partnership or corporation), business formation documents, ownership agreements, and a business license. Note, however, that some banks require even more information. 

So as you can see, there’s significantly more paperwork involved with opening a business bank account.

Difference 2 - The Fees and Requirements Are Often Higher