Money market accounts provide a way to earn more interest than a savings account while keeping funds as accessible as a checking account.

Are you overlooking a way to earn more money on deposits? A business money market account offers the flexibility of business saving and checking accounts while providing an opportunity to earn more interest. Here’s an overview of how they work.

The basics of business money market accounts

A business money market account is a deposit account that typically earns higher interest than traditional business savings or checking accounts while allowing the account holder to access cash as needed. Interest accrues as long as the minimum balance is maintained. At Consumers, you can open a money market account for as little as $2,500.

The key difference between a business money market account and a business savings account is that money market accounts typically offer higher interest rates.

A tiered structure for money market accounts means higher minimum balances earn higher interest rates. Rates are variable and shift in response to factors like changes in the federal funds rate or economic conditions.

Funds in a business money market account are generally accessible through a debit card, online transfers or check transactions—although options vary by bank. Also, some banks limit how many withdrawals or deposits may be made each month and may charge a monthly maintenance fee if the balance falls below the minimum balance requirement.

When to use a business money market account vs. a business checking account

A business money market account is a useful place to save and grow money you don’t need immediately. Many businesses use them to accumulate funds for:

• new equipment or vehicles
• building renovations
• reserves to cover expenses during seasonal fluctuations in income
• emergency savings

The higher interest rates on money market accounts helps businesses reach their financial goals faster.

Business checking accounts are best suited for day-to-day transactions like paying bills, processing payroll and accepting customer payments because these activities can result in fluctuating balances that may not meet a money market account’s minimum balance requirement.

If your business has adequate cash flow and reserves, you can use both a money market account and a checking account.

Advantages of a Consumers business money market account

Consumers business members have access to business money market accounts with several advantages, including:

• Unlimited deposits and withdrawals
• No monthly fees
• 24/7 access through Online Banking
• NCUA insurance up to $250,000

Business money market accounts can be opened at any Consumers office or online.

 

Federally insured by NCUA