- Are you trying to grow a side hustle
into a small business?
Or perhaps you're finally starting to see
some passive income come in from your
online book royalties or from your online courses.
One of the most important steps
you can take as an entrepreneur
is to separate your business and your personal income.
Using a business checking account for depositing your
business income and your business expenses
can help take your business to the next level.
But what bank should you use
for your small business checking account?
One company to consider is Novo.
Novo is a FinTech company that is making it easier
for small business owners to open checking accounts.
In our video today,
we're gonna see how noble compares
to other top small business checking accounts.
And you'll find out if Novo is right for you.
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Hey everyone, this is Andy with The College Investor
investing and personal finance for millennials.
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Novo actually isn't a bank.
It's a US tech-based company based in New York
That's working to bring small business banking
into the digital era.
Novo's goal is to create a compelling banking experience
by allowing small business owners
to quickly open accounts and use their banking data
for bookkeeping and reporting.
Right now, Novo only offers
online business checking accounts.
Its accounts are offered through
the company's financial partner, Middlesex Federal savings.
So what does Novo have to offer?
Well for someone with no experience
with business checking accounts,
a business checking account probably seems like
really easy and plain vanilla.
However, opening a business banking account
can be a frustrating experience.
Additionally, business banking accounts
often carry hefty monthly fees.
Novo's business checking account differentiates itself
on several different points.
The first point is, multiple funding and spending options.
Novo makes it easy to fund your account
with free ACH transfers from another bank account.
You can also deposit physical checks
by just snapping a picture of it.
The one missing feature on the funding side
is simple cash deposits.
While it's technically possible
to load cash into your Novo account,
the process is cumbersome.
You'd need to purchase a money order from a retailer
and then deposit it into your account
using Novo's mobile check deposit tool.
When it comes to spending your money,
you also have a variety of options
while you're waiting for your physical debit card to arrive.
You can use the Novo virtual card,
which can be used online or added to Apple pay
or Google pay to use at physical retailers.
You'll also be able to pay your vendors
however they prefer.
This includes ACH transfers, wire and mailed checks.
You can even pay with cash
if that's your vendor's preference,
as Novo refunds all ATM withdrawal fees.
The second differentiator is invoicing.
Nobel users can create, send and manage invoices
right in their checking account.
Users that connect with Stripe will be able to
accept credit and debit card payments
directly from their customers via invoices.
Support for integrations with
Square and PayPal are coming soon.
The third standout feature with Novo
is business budgeting.
With Novo reserves,
you can section off funds within your account
to budget for expense or pay themselves.
This is great for tax planning.
Novo also allows you to export your statements
so you can easily upload a spreadsheet
to QuickBooks or other bookkeeping software.
These features really make Novo
a solid online business bank,
especially if you follow business budgeting systems
like Profit First.
And last, but not least, Novo has apps.
Novo works with over 1000 business tools,
including popular ones like QuickBooks, Stripe,
Xero, Shopify and WooCommerce.
Over 15 of these integrations
are native inside the Novo app,
which eliminates the need to log into each app separately
to get a bird's-eye view of your businesses,
full financial picture.
There are no ongoing fees with Novo.
You won't pay for debit cards, a monthly fee,
a statement fee or any other ongoing fees.
Novo also provides unlimited ATM withdrawal fee.
And in a rarity, this even includes withdrawals
that are made from international ATMs.
You may have to pay a $27 fee for non-sufficient funds
if you overdraft, or a $27 fee for a returned item.
However, these costs are reasonable
compared with the high cost of
other business checking accounts.
So how does Novo compare to others then in the marketplace?
While Nova was one of the first fee free
business accounts to focus on online businesses,
it's not the only one out there today.
In fact, the competition for the
best business checking account is heating up all the time.
Lili and Lending Club both have $0 monthly fees,
just like Novo.
All three of these have the ability to make online deposits,
but only Lending Club earns you interest.
So how do you open an account with Novo?
Well, a Novo account is super easy to open.
You can get started by visiting their website
in the description below.
Once you're there, you can open your business account
as a sole proprietorship.
If you haven't filed documentation for an LLC
or another corporate structure in your state.
Let's talk safety and security.
After all, this is our small business baby
we're talking about here, right?
Rest assured, knowing that your Novo funds are
FDIC insured up to $250,000 per depositor
through its partner bank Middlesex Federal savings.
Also the company site is protected
with bank level encryption,
and two factor authentication is supported
with accounts as well.
If you need to get in touch with Nova, for any reason,
you can reach out on their support line through email,
through phone and through the Novo app.
Customer service times,
as of the time of this recording are Monday through Friday,
9:00 a.m through 6:00 p.m Eastern standard time.
If you want to shoot them an email,
you can do that at support@banknovo.com.
Novo doesn't publish its customer service number right now,
but you can find it on the back of your debit card.
The Trustpilot rating for Novo is currently great.
At 4.0 out of five, with over 900 customer reviews.
However Novo is not currently accredited
or has a rating with the better business bureau.
In the end, is Novo worth it?
Well opening a small business checking account
at a local bank shouldn't be expensive
or difficult in our opinion,
but for whatever reason, it is (laughs)
few brick and mortar institutions
offer free business checking accounts.
And those that do, require you to stand in line,
bring in a bunch of documentation
and fill out paperwork to officially open the account.
I've personally worked with both PNC and Chase,
two massive brick and mortar banks.
And as a small business owner myself,
the process was cumbersome.
It was old school and it took an incredibly long time.
Novo clearly eases the process,
especially for side hustlers and entrepreneurs
who don't have a business checking account yet.
To learn more about Novo and the other small business banks
mentioned in this video,
we've placed all their links in the description below.
Thanks for hanging out today.
This is Andy from The College investor.
We'll see you in the next video.