If you have a business and its making money it’s more important than ever to make sure that your getting the most interest from your bank. Instead of just letting your surplus sit in your business current account it should be in a Business Savings account. With many banks rates varying from 3 to 8% AER you could could be significantly better off.
When considering putting your money in a Business Savings account it’s important to remember that there are different types each giving you different returns and different levels of access you you money.
Easy Access Accounts: These are the easiest types of account to obtain and can be opened with as little as a £1 deposit. As the name suggests money deposited in this type of account is available at a moments notice. Their downside is that will typically have a lower level of interest paid on any deposits.
Notice Accounts: As the name suggests with this type of business savings account you have to give a minimum notice before withdrawing any deposits. The notice period will vary from account to account but will typically be in the range of 30 to 60 days. In return for the inflexibility of the account a higher interest rate is generally paid. Any withdrawal without the appropriate notice (if possible) will generally result in a penalty on the interest paid.
You should choose the right type of business savings account based on the your dependence on been able to access the money in the account. I might be a good idea to open one of each type of account and put only as much as you can afford to be inaccessible for the minimum notice in the notice account.