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Commercial Banking -

Decoding deposit accounts: Managing surplus cash is about more than the interest rate

From understanding various account features to considering the importance of accessibility, businesses navigate a myriad of factors when selecting a business deposit account (also known as a business savings account). We spoke with Rachel Rowling, a Commercial Banker on our team dedicated to supporting technology businesses, who provided valuable insights into selecting the most suitable business deposit account.


3rd June 2024


Understanding business cash flow needs

Rachel begins by highlighting the initial steps in choosing the appropriate business deposit account, “The first step is assessing your business's cash flow needs. It is about how frequently you need to access your surplus cash,” Rachel explains. She recommends an instant access savings account for businesses requiring immediate liquidity due to its flexibility. However, “If access to the cash surplus is less frequent, a notice account or fixed term deposit might offer better interest rates,” she adds.


Enhancing business operational efficiency

Rachel touches on how certain features, like mobile and online banking, can influence a business's decision. “Features that enhance convenience and access to funds can be incredibly beneficial,” she mentions.

Furthermore, she points out that the quality of client support is a crucial consideration for many clients. She highlights the benefits of dedicated relationship teams, particularly in times of need. “At Arbuthnot Latham, we operate without call centres; our clients receive direct support from their relationship managers and their teams, who are readily available to meet their banking needs,” Rachel concludes.


Compare business deposit accounts

When comparing different business deposit accounts, Rachel offers a systematic approach:

“It is essential to ensure you are maximising your returns while managing risks effectively.”

Key factors to consider include whether the interest is variable or fixed, balance requirements, and access to funds. She emphasises the importance of choosing an account that aligns with your business needs and financial strategy.

A variety of deposit account options are available to suit different business needs.

  • Instant access savings accounts: These accounts are ideal for businesses that require immediate access to their funds. They offer flexibility but typically provide lower interest rates than other accounts.
  • Notice accounts: Suitable for businesses that can plan their cash requirements ahead of time. Notice accounts often offer higher interest rates in exchange for agreeing to notify the bank a set number of days before making a withdrawal. They strike a balance between higher returns and accessible funds.
  • Fixed term deposits: Best for businesses that can set aside cash for longer periods without needing access to these funds. These accounts usually offer the highest interest rates, providing a fixed return on your deposit over a predetermined term.

Each type of account serves distinct financial strategies and liquidity needs. By understanding these differences and aligning them with your business goals, you can more effectively manage your business’s surplus cash.


Consider having multiple savings accounts for different business needs

Rachel concludes by explaining why businesses might consider maintaining a number of savings accounts. From tax preparation and expense monitoring to creating an emergency fund and planning for future projects, having separate accounts can serve strategic financial management purposes.


Consult your Commercial Banker

One key piece of guidance from Rachel is the importance of consulting with a professional.

“Consulting with your Commercial Banker is crucial because they can provide tailored solutions based on an in-depth understanding of your business's financial landscape and goals.”

This personalised guidance can help businesses navigate various options and find the best account that offers optimal growth, meets liquidity needs, and aligns with financial strategies.


Compare our commercial deposits

Our Instant Access Savings Account, Fixed-Term Deposit Account, or Notice Account can help you manage your money or ring-fenced funds and make them work as hard as you do.


Becoming a client

Take control of your finances today by completing our enquiry form. Alternatively, you can call us on the number below and one of our team will be more than happy to talk about your future.

+44 (0)20 7012 2500

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