Many small to medium enterprises (SMEs) are feeling ‘the pinch’ these days, so identifying any possible areas where savings can be made is now especially worthwhile. One area that is probably often overlooked is business bank account charges. For example, at the time of writing, Barclays was charging £231.60 per year for the services that are most likely to be used*. And that doesn’t include any unexpected penalties, such as when an item is returned!
Yet there is an excellent alternative to a traditional business bank account: a prepaid card account,such as the Cashplus Business Expenses Account.
For example, with a Cashplus account, there’s no monthly fee. Instead there’s an annual fee of only £29.99. Plus there are no fees for cash and bank transfer deposits – and that could add up to a huge saving for any business that involves receiving many payments by cash. There are also free and unlimited UK purchase transactions. What’s more, online payments and transfers are free, and free Direct Debits are going to be available very shortly. And the icing on the cake is that there are no unexpected penalties to eat into profits.
As well as potentially saving businesses a small fortune in bank charges, a prepaid card could save a huge amount of time. For starters, there’s no need to visit a bank branch to try and set up an account – applications are carried out online and acceptance is guaranteed, as long as the business is based in the UK and the applicant is aged 18 or over.
What’s more, balance and transactions can be tracked for free online, 24 hours a day, seven days a week – whenever it’s convenient.
Prepaid card accounts also make a good alternative to expenses cards, as there’s little chance of overspending because staff can only spend what the business has loaded onto the card’s account and the risk of fraud is reduced as spending can be instantly checked online.
Lastly, some prepaid card companies also offer free Euro and US Dollar currency cards. These are superb for any business that carries out transactions in the Euro Zone or in the USA. That’s because they offer very competitive exchange rates, there are no commissions or fees for withdrawing money in the local currency and there are no purchase fees.
So in short, any SME that’s looking to cut costs could well make useful savings by switching from a typical business bank account to a prepaid card account.
*Figures from http://www.barclays.co.uk/ImportantInformation/Ratesandcharges/P1242559944567 and correct as at 25 August 2011. Total figure of £231.60 per year assumes: 10 Direct Debits at 54p each per month, 10 Standing Orders at 54p each per month, 20 BACS payments at 15p each per month and 12 monthly fees at £5.50 each per year.