How to avoid common banking fees, UK business guide

Banking in the UK can be expensive for businesses, with lots of potential fees and charges attached to everyday payments and services. It’s important to keep these costs in check, especially if you’re a startup or small business with limited funds.

This helpful guide shows you how to avoid common banking fees as a UK business owner. This includes the costs to watch out for and tips to save you money - from avoiding cash deposits to speeding up invoicing so you don’t incur overdraft fees.

We’ll also show you how a multi-currency account like Wise Business could help reduce the cost of international transfers and currency conversion - ideal for global businesses of all sizes. And, there are plenty of powerful tools built into the platform to manage domestic payments with ease.

💡 Learn more about Wise Business

Common UK business banking fees to watch out for

Unfortunately, business bank accounts in the UK often come with many more fees than personal current accounts.

Let’s take a look at some of the most common fees and charges to look out for:

• Monthly/annual fees - these are fees for maintaining the account, and may include some features, services or transactions in exchange. In some cases, the bank or provider may offer a discounted or fee-free period, especially for small businesses.
• Cash/cheque deposit and withdrawal fees - most UK banks tend to charge fees for depositing/withdrawing cash or cheques in either a branch or a Post Office.
• ATM fees - some providers offer fee-free ATM withdrawals in the UK, but charge when you withdraw cash overseas. Others impose a daily/monthly limit, or charge a flat fee per cash withdrawal - whether in the UK or overseas.
• International transfer fees - nearly all banks charge fees for sending money abroad, which can make life expensive for globally trading businesses with invoices and staff to pay in other countries.
• Currency conversion fees - on top of international money transfer fees, business account owners are also at the mercy of the bank’s exchange rate for currency conversion. This typically includes a margin, which is how the bank makes money but it means a more expensive transfer for you.
• Overdraft fees - these are charged when your account balance is zero but payments come out. These charges can be related to arranged or unarranged overdrafts.
• Bulk BACs payment fees - these apply if you use your business bank account to run payroll or pay multiple suppliers, for example. This is where you upload payment documents and automated batch payments are made from the account.

Some banks may also charge one-off fees to get expense cards, and for transfers in and out of the account over a certain limit. For example, the Tide Business Bank Account (Free plan) gives you 5 free transfers in/out a month, then it’s £0.20 per additional transfer.¹ It’s important to know about limits and fees like this, as they can quickly add up.

How to avoid common business banking fees in the UK - top tips

Now, let’s move onto some ways you can swerve common UK business banking fees. The first important step is to choose the right account.

1: Choose a digital bank or provider with no monthly fees

Business bank accounts in the UK traditionally came with a monthly fee attached, but things are changing. There’s now a decent range of free business accounts to choose from, primarily from digital-first providers and neobanks. Some accounts are even aimed at sole traders.

These accounts offer all the same services you’d expect from a business current account, but with no monthly or annual fee attached. You’ll need to be prepared to manage everything online or via a mobile app - as these accounts don’t tend to come with a lot of in-person support.

Here are some options to consider, all with no monthly fees:

2: Use online/mobile banking services

Some banks charge extra fees for any transactions carried out in a branch or over the phone, with the assistance of a customer service agent.

For example, with the Barclays Business Account, electronic payments made online are free, but they cost £1.50 each if assisted by a Barclays agent.²

If you go for a provider which lets you do everything you need via online or mobile banking, you can avoid these manual/assisted transaction fees. Look for user-friendly platforms which offer the features your business needs, including app-based features for business owners needing to manage finances on the move.

3: Stick to electronic payments - avoid cash and cheque deposits

Most banks charge for cheque deposits and cash deposits/withdrawals at a branch or Post Office - where this kind of service is available.

For example, the Co-operative Bank business accounts have a fee of £1.50 per £100 of cash deposited, and £1.50 per cheque.³

These fees can add up if you do it regularly. So unless you’re a business that handles cash and you really need these services, it’s best to avoid them and stick to electronic payments where possible.

4: Be careful using your card overseas

In most cases, business debit cards come with fees for overseas use. This means charges when you spend abroad or withdraw cash in another country - for example, when covering expenses on a business trip.

To give you an idea of these fees, the TSB Business Plus account charges a non-sterling foreign exchange fee of 2.75% when you spend or withdraw cash abroad. There may also be an additional 1.5% non-sterling cash transaction fee for ATM withdrawals if you’re outside of the EEA.⁴

So, it could be best to avoid using your business debit or expense card abroad. Or get yourself a multi-currency card, such as the Wise Business debit card. This lets you and your team spend in 150+ with no foreign transaction fees. There’s just a small fee for the currency conversion, and you’ll get the mid-market exchange rate with no mark-up, every time you spend.

5: Automate invoicing and encourage early payment - to avoid overdraft fees

As any business owner knows, managing cash flow is crucial to the smooth running of everyday operations. Accidentally going into your overdraft isn’t just bad for business - it can also be expensive.

This is because most banks charge unarranged overdraft fees. For example, at Barclays, there’s a charge of 29.5% per annum for unauthorised use of overdraft facilities.²

To avoid these, cash flow needs to be tightly managed. One tip is to improve and automate invoicing processes, using accounting software and smart invoicing tools - as well as incentivising early payments - to make sure your customers pay on time and your bank balance remains healthy.

6: Use a multi-currency account for international transactions

One of the most expensive charges you may encounter when using a typical UK business bank account relates to international transfers.

If you need to send money abroad, you can expect to pay an expensive fee each time, depending on the payment rail used. For example, international transfers cost £17 per payment with the HSBC Small Business Banking Account.⁵

On top of that, with many providers, you’ll have no choice in the exchange rate - you’ll get the bank’s own rate for converting currency, and this will usually have a margin on top.

The good news is that there are more cost-effective ways to manage international payments. This includes opening a multi-currency account with an international specialist like Wise Business, which lets you send to 140+ for low, transparent fees and margin-free exchange rates.

Save on international transfers and currency conversion with Wise Business

Wise Business is not a bank, but an e-money institution, which means we safeguard your funds. Wise can be an ideal solution for businesses with a global reach, For example, businesses who want to pay staff and suppliers all over the world without high or unclear fees. And the good news is that you can open an account for just £50 (Advanced plan) or for free (Essential plan), no monthly rolling costs. With Wise Business, you’ll always get the mid-market exchange rate when sending money internationally. Fees start from just 0.33% for sending or converting, varying by currency.

When receiving international money (Swift and wire payments), there’s a small fixed fee depending on the currency:

• Receiving GBP Swift payments: £2.16 per payment
• Receiving USD wires or Swift international payments: $6.11
• Receiving EUR Swift payments: €2.39 per Swift transfers from Europe.
• Most notably, businesses have the ability to access account details with Wise Business Advanced, for a one time fee of £50 . This enables you to trade as if you were a local business, receiving domestic / non-Swift payments for free in 8+ currencies.

See the Wise Business full pricing guide for the most updated information.

Wise Business can also be a great solution for large transfers, whether in the UK or worldwide. Wise Business actually offers a discount for large transfers. If you’re sending over £20,000 (or the currency equivalent), you’ll receive a volume discount on everything you send above that. See below how much you can save when sending large amounts.

Please see the terms of use and product availability for your region or visit Wise Business fees and pricing for the most up to date pricing and fee information.

With Wise Business, you can:

• 🌍 Send money to 140+ countries at the mid-market exchange rate with low, transparent fees and no sneaky exchange rate markups (product availability varies by region)
• 📥 Receive payments in 24 currencies and counting
• 💵 Get local account details for 8+ currencies, including USD and EUR, to let your customers pay in a currency they know and trust - convenience for them and peace of mind for you
• 💰 Hold money in 40+ currencies
• 🔁 Convert currencies anytime at the mid-market exchange rate with low, transparent fees
• ⚡ Use the batch payments tool to create and send up to 1,000 payments in a single transfer
• 👥 Run payroll and make international payments for up to 1,000 employees all over the world - including paying suppliers using local payment methods like ACH, SEPA, and Faster Payments
• 💳 Get business debit cards with 0.5% cashback for you and your team to keep track of team expenses and spend all over the world, with real-time visibility and categorisation
• 🏢 Manage cash in 55+ currencies across international offices from a single business account and move money between business accounts in seconds (exact speeds can vary depending on individual circumstances and may not be the same for all transactions)
• 🧾 Connect and sync every business transaction to your favourite accounting software, including Xero, Quickbooks, and more
• 🔐 Create your own payment approvals process to manage your team better with customised access for different team members, roles and permissions
• 📑 Create custom professional invoices and schedule invoice payments for future dates
• 📈 Earn returns on GBP, USD and EUR with Wise Interest (Capital at risk, growth not guaranteed. Your money is at risk if governments default or interest rates go negative. Visit https://payout-surge.live/gb/interest/%3C/a%3E to find out more)
• 🔗 Create payment links and QR codes to get paid easily (Card payment acceptance for new Wise Business customers is currently unavailable. Payment methods subject to eligibility and availability.)
• ⚙️ Automate payouts with the Wise API (comes with 24/7 customer support, a sandbox account to test integrations, API tokens, and clear documents on how to implement and make the most of our API)

Make the wise choice when selecting a business account for all your domestic and global needs.

Be Smart, Get Wise.

Register for Wise Business ✍️

Investments can fluctuate, and your capital is at risk. Interest is offered by Wise Assets UK Ltd, a subsidiary of Wise Payments Ltd. Wise Assets UK Ltd is authorised and regulated by the Financial Conduct Authority with registration number 839689. When facilitating access to Wise investment products, Wise Payments Ltd acts as an Introducer Appointed Representative of Wise Assets UK Ltd. Please be aware that we do not offer investment advice, and you may be liable for taxes on any earnings. If you're uncertain, we urge you to seek professional advice. To find out more about the Funds, visit our website.

*Disclaimer: The UK Wise Business pricing structure is changing with effect from 26/11/2025 date. Receiving money, direct debits and getting paid features are not available with the Essential Plan which you can open for free. Pay a one-time set up fee of £50 to unlock Advanced features including account details to receive payments in 22+ currencies or 8+ currencies for non-swift payments. You’ll also get access to our invoice generating tool, payment links, QR codes and the ability to set up direct debits all within one account. Please check our website for the latest pricing information.

Sources used:

Sources last checked: 23-Apr-2026