Smart Small Businesses Can Easily Secure Hundreds more in Interest Savings by Wisely Selecting Financial Accounts
Boost Your Business Savings with the Right Account
Small and Medium-sized Enterprises (SMEs) can potentially save up to £190 per year by being more aware of interest rates on business savings accounts, according to financial expert Cecilia Mourain, Chief Savings Officer at Moneybox.
SMEs, particularly those without large balances to lock away, have the potential to earn more on their hard-earned savings. This potential savings is without sacrificing access to funds, making it crucial for businesses to find the right account that offers fair, non-tiered interest rates and allows instant or penalty-free withdrawals.
One leading option is the Capital on Tap Instant Business Savings Account. This account offers an initial enhanced rate of 4.07% AER (variable) for 60 days on balances between £50,000 and £500,000, then reverts to a competitive 3.48% AER variable rate. It has no tiered rates beyond this, no withdrawal penalties or fees, and only requires a £1 minimum balance.
The account's flexibility and immediate access, transparent, non-tiered rates after the introductory period, no fees or minimum balances that could hurt smaller businesses, and FSCS protection up to £85,000 make it a top choice for SMEs that need liquidity while earning competitive returns.
While many easy access business accounts have tiered interest rates with the highest rates accessible only at very large balances, the Capital on Tap account avoids this structure, benefiting SMEs with modest reserves. Other options like Barclays offer rates around 1.26% to 1.76% AER, but often require holding a separate current account and may charge monthly fees, making them less ideal for small businesses on a budget.
In summary, for SMEs needing easy access, no tiered rates that penalize small balances, and competitive interest, the Capital on Tap Instant Business Savings Account stands out as a top choice in the UK market. The analysis by Moneybox using Moneyfacts data shows that 1 in 5 providers of easy access business savings accounts offer their best interest rates on higher deposit levels.
By understanding tiered interest rates, businesses can make more informed decisions about where to save. An average easy access business savings rate is 2.09%, and the median profit of a UK SME in 2024 was £13,000, according to Statista. Moneybox encourages businesses to seek out providers offering strong, flat rates across all balances for a fair return.
With the right savings account, SMEs can optimize their savings, whether building a financial buffer, improving cash flow, or earning a fair return on reserve funds. An easy access account provides businesses with the flexibility they need while helping them strengthen their financial position.
- To earn a competitive return without sacrificing liquidity, SMEs might consider personal-finance strategies, such as ensuring their personal-finance savings are also placed in accounts offering fair, non-tiered interest rates, just as they would for their business savings.
- Aside from optimizing business savings, SME owners should also focus on personal-finance management, fostering a strong understanding of finance and making informed decisions that allow them to build wealth and achieve financial stability for the long-term.
