When setting up your business, it feels like the safest option to put your business finances into a traditional bank account and keep it there.

But now you’re no longer a newbie to the business game, it might be an idea to venture into the digital world of some pretty nifty online-only bank accounts.

Not only do these banks usually have no fees for basic packages, and most fully integrate with accounting software such as (our personal favourite) Xero, they’re a great way to systemise your finances, and streamline your business’s financial flow.

So if you’re looking for ways to make your day-to-day financial dealings as smooth and effortless as possible, it might be worth looking at some of the ways challenger banks can help.

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Divvy up your cash into pots

When cash hits your business account, the last thing you want is no idea how and where this money needs to be spent or saved. Especially when you’re trying to maximise your cash flow and avoid paying out lump sums your finances weren’t prepared for.

That’s where digital banks offer a handy feature your high street bank doesn’t. Savings pots. There are a number of digital business banks that offer some kind of separate spaces for your different financial needs, but two of our favourites are Starling Bank’s Savings Spaces and Monzo’s Tax Pots.

By allocating portions of your income to things such as your upcoming tax bill, and even your training and marketing budgets, you can make sure you’re paying everything needed to keep afloat, but also incrementally investing in your business growth.

Cashless petty cash

Gone are the days where the office’s petty cash is kept in a locked tin at reception.

Challenger banks offer the wonderful opportunity to transfer small amounts from your main account into a separate digital one, just for petty cash. If you want to organise things even further, there’s a selection of features on most of these banks that allow employees to use debit cards with an allocated amount of money for them to spend.

Not only does this make things more efficient for those responsible for keeping tabs on the petty cash, it also makes bookkeeping a breeze. No more making sure you get a receipt for your coffee to stick in the tin. And with the integrated bookkeeping features on most of these accounts (more on that later), when it comes time to balance the books it’ll be a piece of cake.

Keep payroll pry-proof

What people earn is a touchy subject at the best of times, and not only could unauthorised eyes on the payroll figures cause you a headache with the ICO, it could also create one heck of a bad atmosphere in the office.

Avoid the potential for prying eyes and transfer your payroll pot into an online account such as Monzo and pay your staff from there. That way there’s no chance the office gossip will inadvertently spy what the rest of the office earns while accessing the account.

Control who does what with your cash

Just as with the above benefit, you might also be rightly picky about your staff having unfettered access to all that hard earned profit. Payments can get lost, transactions aren’t logged, nobody remembers who did what, and when. Before you know it, your entire system is in a right financial muddle.

Challenger banks are amazing for creating access levels for different members of staff, depending on their duties. Wise has a wide range of pre-set access rights, or if you’d like more customisable access options, Revolut allows you to create custom rights roles and set any combination of apps and features you’re happy for them to access.

With everyone’s access nicely organised, you can keep track of who’s doing what at any time, speed up your transactional and accounting processes, and rest easy knowing that the people who don’t need to have open access to your account, won’t.

Run your empire all in one place

If you’ve got multiple businesses and find it time consuming to log in and out of numerous apps, with a million different passwords you never write down just in case, then using a digital bank like Wise might just be the answer you’re looking for.

With a Wise business account you can have multiple accounts for all of your business ventures under one single login. So you can have a real-time look at how your business empire is growing.  

Bookkeeping that keeps up

Now it’s not news that digital business bank accounts can help you do your bookkeeping in real time, on the go. But we do think that it’s worth looking twice at if you want to streamline your financial flow. 

Most digital business accounts will automate expenses categories and organise your transactions, but with Starling’s business add-on, you can even create a bookkeeping to do list, so you always know where you stand.

Or if you have a very niche set of business expenses, you can create your own custom expenses categories with Coconut bank.

So what now?

There’s loads of different digital bank accounts out there, each with their own set of smart features that could be just what you need to solve your financial friction, and with such a wide selection, it can be hard to figure out which way to go.

So if you want to make your financial flow effortless, and need some help building the perfect combo for you, we have a lot of handy know-how to help you on your way.