Every founder asks it in week one: which business bank account should I open? There are dozens, most of them are perfectly adequate, and the decision matters far less than opening one immediately and never mixing company money with your own. A limited company is a separate legal person. Its money is not yours, and a shared account turns a five-minute bookkeeping job into a forensic one.

But founders keep asking what we would pick, so here is the honest answer, the eligibility rules that decide whether it is even available to you, and the one deposit-protection mistake we see funded startups make within a month of their raise.

The three things that actually decide it

Strip away the marketing and a startup business account is judged on three things. Everything else is noise in year one.

  1. What it costs every month. Pre-revenue, a fixed monthly fee is a fixed monthly hole in your runway. It is small, but it is certain, and it recurs whether or not you trade.
  2. Whether the deposits are protected, and by whom. The Financial Services Compensation Scheme protects eligible deposits up to £120,000 per eligible depositor per authorised firm, a limit that rose from £85,000 on 1 December 2025. Some app-based providers are e-money institutions rather than banks, which means safeguarding rather than FSCS cover — a materially different thing if the provider fails.
  3. Whether it feeds your bookkeeping automatically. A connected bank feed is the difference between twenty minutes a week and a lost weekend in January. Manual CSV imports drift, duplicate, and quietly stop happening in the month you most need the numbers.

On all three, the account we point most founders to is Mettle, provided by National Westminster Bank Plc.

It is free, and free compounds when you are counting runway

Mettle has no monthly account fee. That is not a promotional period — it is the product. For a company with no revenue and a fixed pot of cash, every recurring cost you do not sign up for is runway you keep. It is not a large number on its own; it is the habit of not signing up for small certain costs that decides how long the money lasts.

It is a bank, not an e-money wrapper

Mettle deposits sit with National Westminster Bank Plc, so eligible balances carry the full £120,000 FSCS protection. FSCS confirms that it generally protects companies' deposits regardless of the size of the company, so a limited company gets the same £120,000 as an individual.

Two consequences founders miss:

  • The limit is per authorised firm, not per account. Because Mettle sits under the National Westminster Bank Plc licence, a Mettle balance shares one £120,000 limit with any other NatWest-branded account you hold. Two accounts with the same bank is one lot of protection, not two.
  • Sole traders are combined, companies are not. If you trade as a sole trader, FSCS treats your business and personal money with the same bank as one depositor — a single £120,000 limit across both. Incorporate, and the company becomes a separate depositor with its own £120,000, separate from your personal accounts at the same bank. That is a genuine, if minor, argument in the incorporation decision.

It includes FreeAgent — with one condition nobody mentions

This is the part that settles it for us. Mettle customers get FreeAgent included at no cost, which Mettle values at up to £150 a year against the standalone subscription. Transactions flow from Mettle into FreeAgent automatically, with no separate open banking authorisation to renew every ninety days.

The condition. Mettle's terms require at least one transaction a month from your Mettle account to keep FreeAgent free. Stop transacting, or close the Mettle account while continuing to use FreeAgent, and standard FreeAgent fees apply. A dormant pre-launch company that banks the seed money and then makes no payments for a quarter can quietly fall out of the free tier. One small recurring payment — your domain renewal, your accountancy fee — keeps it alive.

Because our startup packages also include FreeAgent, the two routes overlap rather than duplicate. What you get is one live ledger that your accountant and you are both looking at, which is the actual point. Our post on turning FreeAgent into a founder's dashboard covers what to read in it each week.

Worked example: what the whole stack costs in year one

Illustrative figures. A single-founder limited company incorporating in September 2026 and trading from day one.
  • Companies House digital incorporation fee: £100 (the fee from 1 February 2026; the paper route is £124)
  • Companies House digital confirmation statement, once a year: £50
  • Mettle business account, twelve months: £0
  • FreeAgent, twelve months via Mettle: £0 (worth up to £150)
  • Buzz startup package, £49 + VAT a month: £588 + VAT
  • Year-one total: £738 plus VAT on the accountancy fee
Of that £738, the two Companies House fees are unavoidable and the accountancy is the only real choice. Banking and bookkeeping software cost nothing. That is the argument in one table.

Worth knowing for the tax computation: the £100 incorporation fee is a capital cost, not a trading one, so it is added back when taxable profit is worked out even though the company can still reimburse you for it. Professional fees for genuine setup advice are treated differently. Our post on pre-trading expenses works through which bucket each early cost falls into.

The mistake funded startups make within a month of the raise

You close a seed round. The money lands. It sits in one account, and nobody thinks about it again until the next board meeting.

Illustrative figures. A company raises £500,000 and holds all of it in one bank.
  • FSCS protection: £120,000
  • Unprotected if that bank fails: £380,000
  • Split evenly across three separate authorised firms: £120,000 × 3 = £360,000 protected, £140,000 still exposed
And the £1.4 million temporary high balance protection does not rescue you. It runs for six months and only for specified personal life events — the proceeds of a house sale, an inheritance, a redundancy payment, a divorce settlement, a personal injury award. A funding round is not on the list.

The honest conclusion is that FSCS is not the right tool for protecting a seed round, and spreading money across five banks to chase deposit cover is a lot of administrative friction for partial protection. What a funded company needs instead is a written treasury position: how much stays in the operating account, how much sits in a separate savings or Treasury-bill facility, who is allowed to move it, and what the counterparty concentration is. That is a board-level decision, and it is worth taking before the money arrives rather than after. Our guide to runway and forecasting covers how much operating cash the account actually needs to hold.

The honest caveat: who Mettle does not fit

Mettle's eligibility rules are narrow, and they rule out a meaningful slice of startups. You cannot open one if any of the following apply:

  • More than two people with significant control. Limited companies are limited to two PSCs, all of whom must be individuals rather than corporate entities. Three co-founders on the cap table means Mettle is out.
  • More than one person needs to access the account. Only one owner can access it, and there is no multi-user access or per-user spending control. A founding team that wants separate cards and approval limits will outgrow it.
  • You are an LLP or a partnership. Both are excluded, as are PLCs, charities, non-profits, trusts, community interest companies and unlimited companies.
  • The account opener is not both a director and a PSC. That combination is required, and at least one PSC must exist.
  • Balances above £1 million, or owners who are not UK tax resident. Certain sectors are excluded outright, including gambling, cryptocurrency, adult entertainment and money service businesses.

If any of those describe you, Mettle is the wrong answer and we will say so rather than force it. A three-founder company needing three cards should go straight to a business account built for multiple users, and accept the monthly fee as the price of the thing it actually needs.

What to do this week

  1. Check eligibility before you apply, against the PSC and access rules above. Applying and being declined wastes a week you do not have.
  2. Open the account and move every business payment to it — including the ones you have been putting on a personal card since incorporation. Reimburse yourself properly and record it.
  3. Connect the feed to FreeAgent and set explanation rules for your recurring costs — hosting, software, rent — so they classify themselves from then on.
  4. Set one small recurring payment out of the Mettle account so the one-transaction-a-month condition can never be breached by accident.
  5. If you hold more than £120,000, write down where the surplus sits and who can move it, before the next board meeting rather than after.

Bank, software, accountant. Three pieces, one afternoon, and the two that recur monthly cost nothing. Get started, or read our business banking page for the alternatives if the eligibility rules rule you out.