Novo

Novo Bank Overview

As a business owner, you need a business checking account with attractive features that don't charge a lot of unnecessary fees. Our Novo Bank Review will help you decide if Novo is the right bank for you.

Pros

• No monthly fees or minimum balance requirements
• Deposit checks with your phone instantly with remote check deposit
• Free incoming wires and ACH deposits
• Send unlimited invoices for free
• Create up to five Reserves to set aside money
• App integrations include Stripe, Etsy, Xero, Amazon, and more

Cons

• Can’t deposit cash
• Doesn’t earn interest
• Does not offer business credit cards or savings accounts
• No physical checkbooks are available
• Certain industries are not eligible to open an account
• Must have a Social Security number, U.S. address, and U.S. cell phone number to open

Novo Business Checking Account Overview

• Required Opening Deposit: None
• Required Balance Minimum: None
• Monthly fee: $0
• APY: None
• Domestic Wire Transfer Fees: None to receive; cannot send wires domestically but can send fee-free ACH transfers
• International Wire Fees: Novo partners with Wise to send international wires for a “low” fee
• Transactions: Unlimited
• Bonus: None

How Does a Novo Business Checking Account Work?

The Novo business checking account is an online-only bank account that offers many of the same features and benefits as a traditional bank account. While Novo is a financial technology (Fintech) company, Middlesex Federal Savings, F.A. (Member FDIC) handles all of its banking services. Middlesex also offers FDIC insurance protection of up to $250,000 for each customer.

Novo has no monthly fee and no minimum balance requirement. It’s designed for startups and small business owners, so even someone with a small side hustle can open an account.

All account holders receive a debit card to make purchases online or in person. While waiting for your debit card to arrive, you'll have access to a virtual card immediately through the Novo app to start making purchases.

Novo waives many of the fees for sending or receiving money that other banks charge for. Additionally, you can send payments via free online bill pay or ACH transfers. However, you do not have access to write physical checks yourself.

How to Apply for a Novo Business Checking Account

If you're ready to open a Novo business checking account, here's how to do it.

1. Go to Novo and click "Get started."
2. Provide your email address and create a password.
3. Enter the code that is sent to your email address.
4. Provide your personal information (name, citizenship, mobile phone, address, date of birth, and Social Security number).
5. Provide business information (address, phone, website, EIN, banking volumes).
6. Upload a copy of your Driver's License or Passport.
7. E-sign bank agreements.

Once you submit your application, Novo business banking reviews it and will respond within 1-2 business days with your account information. If it is unable to open your account, Novo may ask additional questions or request additional documents. The documents necessary to open your account vary based on your business structure and which state it is located in.

Novo Business Banking Features

There are numerous benefits of having a small business checking account with Novo. Its checking account offers many of the same features that you'd expect from a traditional bank. Plus, there are some innovative features that a typical bank doesn't offer.

NO MONTHLY FEES OR MINIMUM BALANCE REQUIREMENTS

Novo does not charge a monthly fee for having a business checking account. Additionally, there are no minimum balance requirements.

FREE INCOMING AND OUTGOING ACH TRANSACTIONS

In an increasingly digital world, you need to make payments quickly. Novo offers free incoming and outgoing ACH transactions that process quickly and efficiently.

FREE INCOMING WIRES – DOMESTIC AND INTERNATIONAL

If you're receiving money via a domestic or international wire, there are no fees. Most traditional banks charge for the receipt of a wire transfer.

However, you cannot send wires with Novo. Instead, it offers integration with TransferWise so you can send international wires. Novo does not charge for this service, but fees may apply with TransferWise.

VIRTUAL DEBIT CARD

Customers have access to a virtual debit card through the Novo app while waiting for their physical debit card to arrive. Once the physical debit card arrives, you can continue using the virtual card for online or over-the-phone payments.

SEND INVOICES AND TRACK PAYMENTS

An innovative feature of the Novo business checking account is the ability to send personalized invoices in seconds and integrates with many payment tools. You can also accept ACH or check payments to avoid fees

SET ASIDE MONEY WITH NOVO RESERVES

Create up to ten Reserves to set aside money for any purpose that you want. Examples include taxes, profit, payroll, and other large business expenses.

DEPOSIT CHECKS EASILY

With the Novo app, you can deposit checks easily into your business checking account. You can deposit an unlimited number of checks and there is no charge for this service.

INNOVATIVE NOVO APPS AND INTEGRATIONS

The Novo App Marketplace offers numerous workflow solutions and integrations to choose from. Participating companies include Shopify, Stripe, Etsy, Xero, WooCommerce, and Amazon.

With these apps, you can track your sales and balances, send money overseas, automatically sync with your account software, and more.

Where Novo Bank Falls Short

Novo offers many traditional bank functions, but it does not offer every feature that a full-service bank does. The biggest drawback is its limited deposit and payment capabilities. These are the biggest issues that some businesses may face:

• Cannot deposit cash or coins: Since Novo bank accounts are online-only, there are no branches available where you can deposit cash or coins received from customers. If you have a cash-intensive business, you'd need a second account to handle these deposits.
• No physical checks: You can send physical checks through Novo's free online billpay. However, you will not have a checkbook to write checks on the spot. Keep in mind that mailed checks from Novo may take several days to arrive.
• No option to send domestic wires: While you can send international wires through Novo's integration with TransferWise, there are no options to send domestic wires. However, you can send an unlimited number of ACH payments for free.
• Fees for NSF checks and bounced deposits: Novo charges a $27 fee if you make a payment when you have insufficient funds or a returned deposit item. These are the only fees charged by Novo.
• Does not offer savings accounts, loans, or credit cards: Novo excels with its business checking account, but it does not offer many of the ancillary deposit and credit products that traditional banks offer.
• No recurring bill payments: Novo has a bill payment tool, but doesn’t offer a good option to set up recurring payments.
• No other banking services: Novo focuses on offering just its checking account. If you need other services, such as business lending, you’ll have to go elsewhere.

Novo Bank Pricing

One of the best features of Novo business banking is that it’s all but free to use. The bank has:

• No monthly fee
• No minimum balance
• Free mobile check deposits
• Free incoming wire transfers
• Free ACH transfers
• Full reimbursement of all ATM fees

All in all, that means that almost any company can use Novo without paying a penny. Novo even offers a built-in invoicing tool with the option to accept ACH transfers to help your company avoid invoicing fees.

Terms and Requirements

Novo is an option for almost any business based in the United States. To open an account, you must:

• Have a US mailing address
• Have a cell phone number (virtual phone numbers do not count)

There is no credit inquiry when you apply, so you don’t have to worry about having good credit to qualify.

Novo does restrict certain companies from banking with them. You’re not eligible if you’re running any of the following businesses.

• Cryptocurrency and money services
• Privately owned ATMs
• Marijuana-related
• Gambling
• Money service businesses
• Adult entertainment industry

For Whom is Novo Bank Good?

The answer to this question depends on the type of business you have and what you're looking for in a banking relationship.

The Novo business checking account offers many attractive features for small businesses, but it isn't the right solution for everyone. It is an attractive business checking account full of features that most small businesses need. There are no monthly fees, no minimum deposit requirements, and free incoming wires. Plus, you can send or receive ACH payments for free. The only fees that it charges are for insufficient funds for a purchase or receiving a returned deposit item.

Novo isn't right for your business if you need...

• The ability to walk into a branch and speak face-to-face with a banker.
• To deposit coins and cash.
• To send domestic wires.
• A checkbook to write checks on the spot.
• Interest on your bank balances.
• A full-service bank that offers loans, credit cards, savings accounts, and other features.

When Novo Is a Good Fit

• You make frequent ATM withdrawals: Novo provides ATM fee refunds at the end of each month, offering the flexibility to use ATMs across various networks.
• You seek a business banking experience free of fees: Novo does not impose charges for monthly maintenance, everyday transactions, or ACH transfers.
• Your business processes payments via Stripe: Novo offers Novo Boost, facilitating quicker payments through your Stripe account without additional fees.
• You frequently conduct automated clearing house (ACH) payments: Novo presents Express ACH, enabling you to send same-day ACH payments, ensuring immediate fund availability compared to alternative providers.

When Novo Is Not a Good Fit

• You need to deposit cash regularly into your account: While Novo permits money order and check deposits through its app, it does not support cash deposits. An excellent alternative is Bank of America, which grants a cash deposit allowance of up to $7,500 for basic accounts without fees. To determine if this account aligns with your needs, refer to our Bank of America business checking review.
• You want your business checking account to earn interest: Novo's business checking account does not yield interest. For an interest-earning solution, consider Bluevine, offering an impressive 2.00% APY on balances up to $250,000 when you meet its monthly activity requirements. Explore the distinctions between Novo and Bluevine in our Novo vs. Bluevine business checking comparison.
• You need access to additional banking services: Novo lacks savings accounts and lending products. If you seek comprehensive online business banking, Mercury could be your solution. Mercury provides access to savings accounts, treasury accounts, credit cards, and venture debt. Evaluate which account suits your needs best by consulting our Mercury vs. Novo business checking comparison.

How Novo Stacks Up

Novo deserves commendation for its unwavering commitment to providing a business checking account that boasts minimal fees, setting it apart from several major competitors. Notably, Novo refrains from imposing a monthly service fee, generously refunds all ATM charges, and offers fee-free ACH transfers. Furthermore, it imposes no minimum account balance requirement, levying fees solely in cases of insufficient funds or uncollected returns.

Small business proprietors who are already accustomed to employing payment apps, small business software, and accounting tools may discover that Novo seamlessly integrates with their existing toolkit. Its compatibility with a wide range of tools positions Novo as a central hub for managing your business finances, delivering unparalleled convenience and enhanced financial insight.

Novo emerges as a compelling choice for small business owners who predominantly conduct their banking online, given its tailored focus on facilitating online transactions through its business checking account.

However, it's essential to be aware that depositing cash with Novo can prove somewhat cumbersome. To deposit cash, you must initiate the purchase of a money order from recognized vendors such as USPS, Walmart, or a local grocery store. Subsequently, you can utilize the mobile check deposit feature within the mobile app to process the money order.

Regrettably, Novo does not provide any interest earnings, and its product portfolio remains limited, constraining the scope of services it offers. Consequently, if you seek a banking solution encompassing loans and a broader array of business services, Novo may not align with your specific needs.

Novo Vs. Bluevine

Bluevine stands as a fintech enterprise specializing in delivering online financial solutions tailored to small business proprietors. Within its repertoire, Bluevine offers two distinct services: checking accounts and business loans. Similar to Novo, the Bluevine Business Checking option emphasizes simplicity and cost-effectiveness. Notably, it does not impose overdraft fees, monthly charges, or minimum balance prerequisites. Furthermore, there are no limitations on the number of transactions you can conduct in a given month.

One notable edge that Bluevine holds over Novo is its high-yield interest offering. By either spending $500 using your Bluevine debit card or receiving $2,500 in customer payments monthly, you can secure an impressive 2.00% APY on balances up to $250,000. Additional advantages encompass the provision of two complimentary checkbooks annually, seamless integration with financial apps, and the potential to accrue rewards through your Bluevine debit card.

In contrast to Novo, it's worth noting that Bluevine does not fully reimburse all ATM fees. Nevertheless, account holders enjoy free transactions at any MoneyPass ATM.

Novo Vs. Axos

Axos Bank provides comprehensive banking services, encompassing checking, savings, investment, small business banking, loans, and a range of other financial solutions. Within its suite of offerings, you'll find two distinct business checking accounts: Axos Bank Basic Business Checking and Axos Bank Small Business Interest Checking.

The straightforward Axos Bank Basic Business Checking mirrors Novo's offering. It imposes no initial deposit requirement, no minimum balance criteria, and no monthly fees. Customers benefit from reimbursements for all domestic ATM transactions and enjoy unlimited debit, credit, and deposit processing.

Meanwhile, the Axos Bank Small Business Interest Checking account offers the potential to earn up to 1.01% APY on balances under $50,000, contingent upon an initial $100 deposit. Customers who fall short of meeting this daily balance prerequisite are subject to a $10 monthly maintenance fee.

Both accounts seamlessly integrate with QuickBooks and provide overdraft protection when linked to an Axos business account. For customers requiring cash deposits, these can be facilitated through the MoneyPass and Allpoint networks.

Novo Vs. Lili

Lili operates as a fintech enterprise in collaboration with a partner bank, offering financial services tailored to small business owners. Lili presents a business banking solution with two tiers: Lili Basic and Lili Pro. Lili Basic closely resembles Novo's business checking account, featuring no minimum balance prerequisites or account fees. Conversely, Lili Pro requires a monthly fee of $9.

Both Lili Pro and Lili Basic facilitate the organization of business expenditures and the automated allocation of funds for tax purposes, which proves advantageous, particularly for those managing their own financial records. Lili also seamlessly integrates with payment applications, online platforms, and other bank accounts, streamlining the process of making payments and conducting transfers.

It's essential to note that, unlike Novo, Lili imposes limitations on fee-free ATM transactions, restricting them to in-network machines. Furthermore, cash deposits can only be made at partner retail locations, incurring a fee.

Lili Pro enhances its offerings for the monthly fee by providing benefits such as fee-free overdrafts up to $200, the availability of a savings bucket yielding an attractive 4.15% APY, and cashback rewards at qualifying merchants when utilizing the Lili debit card.

Novo Business Checking Account User Reviews

On Trustpilot, Novo currently maintains a rating of 4.3 out of 5 stars, a consensus formed from over 2,800 reviews. However, a substantial number of recent reviews express concerns regarding the reliability of Novo's business checking platform. Numerous customers have reported instances where Novo rejected check deposits without providing clear explanations. Additionally, some users have faced challenges when attempting to transfer funds via the Novo platform.

Critiques frequently center around Novo's lack of live customer service options, which historically made it problematic to reach customer support during emergencies. It's noteworthy that Novo has recently introduced a phone support line to address this issue. Furthermore, many customers have voiced dissatisfaction with Novo's email support team, citing delays in response times.

Nevertheless, users have also highlighted positive aspects of Novo. They appreciate the absence of fees and the ease of opening an account. Many satisfied customers find Novo's user interface (UI) straightforward to navigate.

Novo Business Banking Alternatives

Novo is just one business banking solution. If you’re starting a new business or simply looking for a new bank, consider these alternatives after reading novo business checking reviews.

Summary

Novo offers a powerful, yet simple, business checking account for all sizes of companies. Whether you're just getting started, have an established business, or running a side gig to make extra money, you should consider opening an account with Novo. On top of that, Novo bank account reviews are generally positive about the company’s service.

There are no monthly fees or minimum balance requirements.. Novo provides free incoming wires and ACH deposits plus a virtual card number to make payments. This makes it easier than ever to get your business checking account started with Novo.