PROVIDENCE, R.I.--(BUSINESS WIRE)--When it comes to managing their finances, a quarter of small business owners are still keeping company money in the same account as their personal finances, according to a new survey released today from Citizens Bank. Despite the potential risks to their personal tax status and their future access to credit for their business, 26 percent of small business owners say they don’t have a separate account for their company.
Commingled personal and business funds can have harmful implications for both personal and company finances, warns Quincy Miller, President of Business Banking at Citizens Bank.
“Using a personal account for business finances is an easy mistake to make when starting out but it can quickly become a liability. For instance, paying personal expenses using business money or vice versa makes it far more difficult to get your accounting right at tax time,” Miller said. “You also want to have a separate account for business so you can build a financial history that you can later use to apply for credit and other products or services you may need to run your business. Finally, not having a separate account can make it too easy for companies to spend personal funds that may be needed for personal mortgage payments and other important household expenses.”
The survey found a general lack of awareness and confusion about business checking products. Among those surveyed, 31 percent of respondents agreed with the statement that “my business doesn't make enough transactions to warrant a separate checking account.”
In addition, 98 percent of those surveyed who currently run their business with their personal account ranked the absence of monthly maintenance fees as being of the highest importance to them, while over 90 percent of businesses with a business checking account ranked the absence of maintenance fees as important.
To help small business owners who historically have been wary of opening business accounts better manage their finances, Citizens Bank has introduced Clearly Better Business Checking, a new business banking checking account with no monthly maintenance fee, no minimum balance requirement and up to 200 free check transactions per statement period at no extra cost.
“Keeping your business banking separate from your personal finances boosts the credibility of your business reduces your personal liability and helps you manage your taxes, bills and other payments,“ Miller said. “With no need to monitor account activity for monthly maintenance fees or minimum balance requirements, Clearly Better Business Checking makes it easier for business owners to focus on serving their customers and growing their business.”
The Citizens Bank survey of 200 small business owners with less than $500,000 in annual revenue was conducted by Market Strategies International, a leading global research firm.
To learn more about Citizens Bank, customers can call the 24/7 customer contact center at 1-800-922-9999, Like the bank on Facebook, follow the bank on Twitter or visit the Citizens Bank website.
About Citizens Financial Group, Inc.
Citizens Financial Group, Inc. is one of the nation’s oldest and largest financial institutions, with $135.4 billion in assets as of September 30, 2015. Headquartered in Providence, Rhode Island, Citizens offers a broad range of retail and commercial banking products and services to individuals, small businesses, middle‐market companies, large corporations and institutions. In Consumer Banking, Citizens helps its retail customers “bank better” with mobile and online banking, a 24/7 customer contact center and the convenience of approximately 3,200 ATMs and approximately 1,200 Citizens Bank branches in 11 states in the New England, Mid‐Atlantic and Midwest regions. Citizens also provides mortgage lending, auto lending, student lending and commercial banking services in select markets nationwide. In Commercial Banking, Citizens offers corporate, institutional and not‐for‐profit clients a full range of wholesale banking products and services including lending and deposits, capital markets, treasury services, foreign exchange and interest hedging, leasing and asset finance, specialty finance and trade finance.
Citizens operates through its subsidiaries Citizens Bank, N.A., and Citizens Bank of Pennsylvania. Additional information about Citizens and its full line of products and services can be found at www.citizensbank.com.