• Mark Benis

Guide to Business Banking for Game Developers



Indie game developers seeking to build their own studio must have a unique combination of creative and business skills to succeed. We draw our art, program our games and write our stories, yet also must market our games, sell merchandise and account all our business transactions. The list goes on. With how saturated the indie games industry is recently, what can set ourselves apart from others is not just by being solid creatives but also by excelling at business.


In my own journey as a game developer opening our studio and learning the ropes of the business, there’s one topic that caused me more headaches than I could have ever imagined: business banking. Choosing the right bank for your studio’s business bank account is an important step in operating your studio, and this article will cover this specifically to make the process as painless as possible.


Because our business is in the US, most of the information here applies to US banking. However, I did put together a list of banking options for you international business folks that I found throughout my research.


Note that I collected all this info in the fall of 2019; the banks listed here may have changed their plans since then so do your due diligence!


Quick disclaimer: I am not affiliated with any of the banks or companies I mention here. I’m simply speaking from my experience and wish to share it so that you don’t have to go through the trouble we did. I am not a lawyer and the information here does not constitute legal advice.


Why open a business account with a bank?

A core business principle is to separate your personal and business finances, especially if you are not the only owner of the company. This will simplify your accounting, organize your finances for paying yourselves/contractors/employees, prepare your company for taxes, and keep your company in good standing with the government. Opening a business banking account is an inevitability if you are making money from your games or paying developers, so better to get this done right sooner rather than later.


Type of Studio Business Structure

When opening a business account with a bank it goes without saying that you first need an official, government-recognized business. Depending on your situation and needs, you might operate as a sole proprietorship, a partnership, a limited liability company (LLC), an S corporation or a C corporation. I’m not going to go into which business structure to choose (that’s for another article), so do your research and get second opinions.


For the purposes of this article, I’ll be using our studio’s structure as reference: a limited liability company with international owners (me in the US, my partner in the Netherlands). Given how easy remote work has become with all of our available tech, I imagine studios like this are more common than ever. This article is specifically geared to help you folks in the same boat as us, but I think studios of all structures will find the info here helpful.


Required Business Documents and Information

After you’ve created your company, these are the essential documents and information you will need to start a banking business account (may vary based on company structure):

  • Your company’s Employee Identification Number (EIN)

  • Business address

  • Proof of filing documentation

Additionally, many banks will ask for personal information of each owner with greater than a 25% share in the company, so make sure you have the following on hand for everyone:

  • Government-issued identification (driver’s license, passport, etc)

  • Social Security Number or the equivalent for your country (burgerservicenummer in the Netherlands, for example)

  • Personal address

Things to Consider When Choosing a Bank

There are so many different features and details to consider when choosing business accounts, and the key to choosing the right bank for you is knowing exactly what you need for your studio. Let’s go through some of the core decision points/questions and hopefully along the way you will get a clearer picture of what type of bank will work for you.

1. Digital vs. Brick-and-Mortar

There are two core types of banks: digital banks and brick-and-mortar banks. Digital banks have no physical branches and have you conduct all your banking online or on an app, while Brick-and-Mortal banks have physical bank locations and may have online/mobile banking options as well.

Digital banks have no overhead costs of maintaining physical locations so they can offer a more flexible business package, are tech-savvy with often well-designed online/mobile banking systems, allow signup completely online, and many have lower service fees than traditional banks. Some features I’ve personally found great from digital banks are the ability to make sub-accounts to save for specific purchases and even track payroll (for example, N26 and NorthOne), flexible team access to the account for your co-owners, and integrations with popular accounting/payment software like Stripe and Xero.


Their major cons are many of them do not support depositing cash, and the digital banking sector is still growing so many banks are quite young. In general, digital banks cater to game studios just starting up with owners spread across the world. Their investment in technology makes them more likely to adapt to new developments, and their plans are very favorable to small businesses.

For brick-and-mortar banks, their physical locations make withdrawing/depositing cash easy, they have good checkings/savings account packages, offer higher annual percentage yield rates on savings accounts, and many of them have a long history that makes them secure options (if you’re not cynical about banks as a whole).


Their major cons are many require all business owners to be present in a physical branch to open an account (costly, if not impossible, for companies with international owners), they have much higher minimum balances than digital banks making them unattractive to smaller startups, and many have a long list of service fees and charges you’ll have to watch out for. A brink-and-mortar bank may be right for your studio if all your owners are based in the same city, you already have a fair amount of money in your business that can make returns in a savings account, and your business depends on operating with cash-in-hand (like selling merchandise at events).

2. How much capital do you currently have and

what is your studio’s annual income?

The size of your studio and how much you make is an important consideration. Checking and savings accounts with brick-and-mortar banks typically require a minimum balance, with the most premium tiers offering the best benefits (like high annual percentage yield rates) and requiring the highest minimum balances. Going below this minimum balance can incur fees depending on the bank’s policy, effectively making that amount unusable without paying out of your pocket. Digital banks often have no minimum balance so you can spend your funds more freely, but at the cost of less attractive benefits.


If your studio has more than $250,000 that you want to deposit in a bank account, make sure you review the bank’s policy on FDIC insurance (see #7). You may want to open multiple accounts to make sure all your studio’s money is FDIC-insured. Though I imagine that if this applies to you, you probably don’t need to be reading this article!

3. How many transactions do you make

every month on average?

Many banks will give you a base amount of free transactions and charge you if you go over. I’ve often seen them define transactions as both money you receive and money you send, but check whether their definition include inbound or outbound transactions. If you are selling merchandise online, making a large number of purchases, or paying out many contractors/employees, I’d recommend finding a bank with no transaction limit or transaction fees.

4. Do you need to write checks?

Check your bank’s policy on checks, as some digital banks do not offer them while others can send checks out on your behalf. They’re standard for brick-and-mortar banks, so you might have better luck with them if checks are essential to your business. Also, writing checks from your business account to the personal accounts of your owners can be an easy and free way to pay yourselves in the US. With fees racking up from other payment services or methods (like wire transfers), you can lose a few percent of your studio’s income just by paying yourselves.


Be careful about sending checks internationally, and banks that mail checks on your behalf typically only do so in the US. Thankfully the vast majority of banks support mobile check deposit — even digital banks — so inbound checks should not be a problem.

5. Where do your company’s owners live?

Are any of them international?

Location of your owners can play a massive part in which bank is right for you. Brick-and-mortar banks may require your owners to be physically present in a branch to open a business account, for example. And while it’s perfectly legal for an international individual to own a US business, be warned that it will complicate your banking. Banks may not be able to mail debit cards internationally, or give out cards to international owners at all.


The registration process of most banks is geared toward US owners, so expect to contact support if they don’t visibly support international owners. Take a look at the section below, “Best banks for LLCs with international owners” to find your best options.

6. Do you want a bank that integrates

with certain 3rd party services?

Digital banks specifically are pushing the boundary with 3rd party integrations, so check what each one offers. Examples of bank integrations are with accounting software (Wave, Xero, etc) and payment services (Stripe, PayPal, etc). Integration with your accounting software is a huge plus as it may allow for automatic import of your transactions which will simplify your accountant’s life (and your own).

7. Is the bank FDIC-insured?

The FDIC, or Federal Deposit Insurance Corporation, is an agency that insures money you deposit in an FDIC-insured bank on behalf of the US government. Basically, if a bank that is FDIC-insured goes under, you as the depositor are covered up to the insured amount (at least $250,000). Be very careful with banks or financial institutions that are not FDIC-insured. Money transfer services like TransferWise or PayPal (yes, surprise!) are not banks and are not FDIC-insured. Do your research into these companies before trusting large sums of money with them.


Digital Bank Options

Great for startup studios and on the forefront of tech. All the following digital banks have online signup, no minimum balance, cannot deposit cash-in-hand, and have online/mobile banking unless otherwise stated. Here are some of the best of them out there:

Azlo

Great option for solo developers in the US.


Pros:

  • Unlimited number of transactions

  • No fees except on outbound wires

  • Can mail checks for free

  • Digital invoices can be sent through Azlo

Cons:

  • Only supports one user in their system

  • Business cannot have international owners unless account is created through Stripe Atlas

Mercury

Great bank that specifically caters to companies with international owners.


Pros:

  • Get both a checking account and a savings account with 0.75% APY under $250,000, 1.25% APY above $250,000

  • Can mail checks for free

  • Team access in your account

  • Smooth signup process, even with international owners

  • Debit card can be used by international owners (must be mailed to a US address first)

Cons:

  • $5 fee for domestic wires and $35 fee for international wires

  • No mobile banking (however the online banking service is great)

NorthOne

A bank with great features and support with a pricey tiered subscription plan. Probably not the best option for studios that sell a large quantity of merch, pay numerous employees/contractors, or otherwise conduct many transactions per month.


Pros:

  • Team support and read-only access for your bookkeeper

  • Integrates with accounting services like Quickbooks, Wave, Freshbooks and Xero

  • Unlimited sub-accounts for dividing your funds (a rare feature among competitors)

Cons:

  • Pricey monthly subscription fee which limits the number of transactions you can make: $10/month for up to 20 transactions, $20/month for up to 45 transactions, and $50/month for unlimited transactions

  • $10 fee for domestic wires and $25 for international wires

Novo

Solid bank for US studios with multiple owners.


Pros:

  • Debit card accepted worldwide without fees

  • Integration with tools like Xero and Stripe

  • Supports business cards for multiple users (must be in the US)

  • Can mail checks for free

Cons:

  • Difficult application process for businesses with international owners, but it is possible

  • Cannot send money internationally through a wire (need a 3rd party service)


Revolut

This UK bank is still setting up their business accounts in the US, but they are worth mentioning for their multi-currency support and impressive features. Would be a great fit for a business that works with clients and contractors internationally.


Pros:

  • Can create accounts to hold, send and receive funds in multiple currencies

  • Can issue an unlimited number of physical and virtual multi-currency cards

  • Team support for multiple users

  • Integrates with Slack and Xero

Cons:

  • A new bank in the American market, it will take them a while before they are up and running (though there is a waitlist)

  • Business account pricing could be on a tiered subscription system similar to their personal account pricing


Brick-and-Mortar Bank Options

The traditional banking option suitable for more cash-centric operations. All the options include combined checking/savings packages and no online signup unless otherwise stated. Here are some of the best options I found:


Capital One

Solid bank if you need a traditional option. Also has some of the best business credit card options which could make Capital One your one-stop shop.


Pros:

  • Unlimited checking account transactions

  • High APY rates for savings accounts

  • Various loan options should you need them

  • Deposit up to $5,000 in cash each month with no fee, $1 for every $1,000 after

Cons:

  • High minimum balance of $2,000 at the lowest plan tier for checking account, $300 for savings

  • Fees for going below your minimum balance


Chase

A great traditional bank for small to midsize studios that has physical branch locations across the country and in major cities. Also has a great credit card if you want to keep all your banking under one roof.


Pros:

  • Can wire funds internationally for $5 under $5,000, free above that amount

  • Nearly 5,000 physical branches across the country

Cons:

  • All owners must be present at a Chase branch to open a business account

  • Moderate minimum balances of $1,500 for checking and $1,000 for savings

  • Limited to 15 free monthly deposits in savings account at lowest tier


Wells Fargo

A decent traditional banking option for startups strapped for cash if you can get past the company’s track record.


Pros:

  • Low minimum balance for both checking and savings at $500 for their lowest tier

  • Additional banking services like small business loans

Cons:

  • Troubling company history reduces trust; they misused customer data and charged users undisclosed fees for unused services

  • Fees for going below your minimum balance, overdrafting


Credit Card Options


Business credit cards are great to have when you need to make large purchases on credit or just want to take advantage of cash back and point plans. I could write an article dedicated just to credit cards, but I’ll summarize it here by just saying that you need to use them responsibly and never let debt accrue on them unless you know exactly what you’re doing. That said, using them can be a smart way to save money and build up your company’s line of credit.


There are all types of credit cards out there geared toward travel, business supplies and other benefits, but I’ll keep things simple by recommending only cash back cards -- credit cards that give you a percentage back of what you spend.


Capital One Spark Classic for Business

  • 1% cash back on all purchases

  • No annual fee, foreign transaction fee or balance transfer fee


Capital One Spark Cash for Business

  • 1.5% cash back on all purchases

  • $200 cash bonus after you spend $3,000 in first 3 months

  • No annual fee, foreign transaction fee or balance transfer fee


Capital One Spark Cash for Business

  • 2% cash back on all purchases

  • $500 bonus after you spend $5,000 in first 3 months

  • $95/year annual fee

  • No foreign transaction fee or balance transfer fee

  • Need to spend at least $4,750 every year to break even on annual fee


Chase Ink Business Unlimited

  • 1.5% cash back on all purchases

  • $500 cash bonus after you spend $3,000 in first 3 months

  • No annual fee

Alternative Financial Company Options

While banks will cover the essentials, there are also other companies that provide services similar to that of a bank without being licensed as an official bank. A typical use of them would be to invoice clients, pay contractors/employees, or conduct business in multiple currencies.

TransferWise

While technically not a bank, TransferWise is one of the leading currency exchange platforms and offers business accounts in multiple currencies as well as even a business debit card (not yet available in the US). They are not FDIC-insured — which does result in some amount of risk holding money with them — but they work with FDIC-insured banks to hold your funds as stated in their FAQ, so they certainly take security of your money seriously.


TransferWise may be the perfect option for you if your studio regularly invoices international clients or pays international contractors, as their currency exchange fees are much cheaper than other services like PayPal. I would recommend using TransferWise in addition to your main bank, not as a replacement.


Best Banks for LLCs with International Owners


Having co-owners of your studio who are from outside the US will exponentially complicate your business, and these banks can accommodate that. Check the list of banks above for more details on the options below.



Mercury

This bank specifically caters to US companies that have international founders and I can personally attest that they are great (they were able to accommodate our studio’s international setup). They’re almost completely hassle free and have a solid plan that caters to startups.


Azlo

Important note: you must start your company through Stripe Atlas and start a business account with Azlo through them for Azlo to support international co-owners. Make sure you contact Stripe Atlas to verify that they can accommodate your company’s unique situation. The process will cost you $500 + ongoing business costs including bank account maintenance (with no Azlo maintenance fee if you work with them directly), so Stripe Atlas/Azlo is certainly not the cheapest option; look into Mercury instead if you’re on a budget. If you already created your business, Azlo will not take you. Otherwise, Azlo itself seems like a great service with their account benefits.


Novo

While Novo accepts businesses with international owners, their sign up process does not cater to them and we personally had to go through many support hoops to open an account with them.

Banking Options for Companies Outside the US

This article doesn’t cover banking outside of the US, but one of the banks I mentioned above, Revolut, does take European companies. Some other European digital banking options that I came across in my research are: Monzo (UK), Monese (UK), and Starling Bank (UK).


If you’re located elsewhere, you may need to do a bit more digging to find a bank that works for you.


Conclusion

There are many important steps to building the foundation of your game dev studio, and getting your banking in order will start you off on the right foot. To choose the right bank for your company, follow these steps:

  1. Determine your studio’s business structure

  2. Decide whether you want a digital bank or a brick-and-mortar bank

  3. Assess your studio’s current capital and income

  4. Find a bank that can accommodate your business structure, size and other needs

  5. Check if the bank is FDIC-insured

If there’s one thing I want to drive home, it’s that “game developer” and “business owner” are such interchangeable words that they might as well be one and the same. Making the decision to become a game developer is just as much a decision to open your own business, whether you’re a solo developer, on a small team, or manage a large number of employees. We must accept the whole package and put time into building our business just as we would foster our other creative skills. It may not be the flashiest part of what we do, but it’s just as important.


Thanks for reading! If you found this article helpful, consider checking out our studio Moon Moon Moon and following us on Twitter — we’ll be sharing more about our studio adventures and writing articles just like this one to help our fellow devs out there. Hopefully you folks can take something away from us and work towards building the game studio of your dreams. Cheers!

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