Lloyds Business Account Review UK: Fees, Rewards & Verdict
Lloyds is a strong choice for small businesses that want a proper UK bank with branches, digital banking, borrowing options and a wide product range. The core account is simple: no account fee for 12 months, then £10 a month, with electronic payments included. The current rewards package makes the first year considerably more interesting.
Is Lloyds a good business bank account?
Yes, particularly if you want a traditional bank without giving up modern app-based banking.
Lloyds’ Business Account is aimed at UK small businesses, sole traders, startups and limited companies with annual turnover below £3 million.
The pricing is now straightforward. Your first Lloyds Business Account has no monthly account fee for 12 months, then costs £10 a month. Everyday electronic payments such as Faster Payments, Direct Debits and standing orders are included at no extra cost.
Where Lloyds differs from Starling or Monzo is the wider banking relationship: branches, business savings, lending, credit cards, foreign-currency accounts and merchant services all sit under the same banking group.
The main trade-off
You are paying £120 a year after the introductory period for a broad traditional-bank relationship. If all you ever need is an app and free UK transfers, a £0 digital account is hard to ignore. If you need cash banking, borrowing or more complex services, the comparison changes.
Up to £400 in rewards plus six months of Xero
Lloyds currently has a significant promotion for eligible businesses opening a Business Account by 15 October 2026.
The offer can include:
- £200 account activation reward after meeting the required debit-card spending and Direct Debit conditions;
- six months of Xero free for eligible new customers; and
- a £200 Amazon gift card with most qualifying Xero subscriptions after the first paid Xero month, subject to the offer terms.
This is why Lloyds currently describes the package as worth up to £400 plus Xero.
This section will date quickly
The current promotion is advertised to end on 15 October 2026 and has activation conditions. Treat it as a temporary extra rather than the main reason to choose an account you may keep for years.
Lloyds Business Account fees
| Service | Current charge | What it means |
|---|---|---|
| Monthly account fee | £0 for 12 months, then £10/month | Applies if this is your first Lloyds Business Account |
| Electronic payments in | Included | Everyday electronic credits do not carry a separate transaction fee |
| Electronic payments out | Included | Includes Direct Debits, standing orders and Faster Payments debits |
| Cash paid in via Immediate Deposit Machine | 85p per £100 | Cheaper than paying cash over the counter |
| Cash paid in or withdrawn over counter | £1.60 per £100 | Worth calculating for cash-heavy firms |
| Cheque paid in via app or deposit machine | 85p each | Digital/self-service route is cheaper |
| Cheque over the counter | £1.20 each | Also £1.20 for cheques written |
| BACS | £5.50 file + 15p/item | A set-up fee may also apply |
| CHAPS | £30 | For high-value same-day payments where needed |
| International payment online | £15 | Correspondent-bank and FX costs can also apply |
How expensive is Lloyds for a cash-handling business?
Cash is where the difference between account types becomes noticeable.
Lloyds currently charges 85p per £100 when cash is deposited through an Immediate Deposit Machine or similar self-service device, compared with £1.60 per £100 over the counter.
| Cash paid in | Self-service at 85p/£100 | Over counter at £1.60/£100 |
|---|---|---|
| £500 | £4.25 | £8.00 |
| £1,000 | £8.50 | £16.00 |
| £5,000 | £42.50 | £80.00 |
| £10,000 | £85.00 | £160.00 |
The lesson is simple
A café banking £10,000 of notes and coins each month should not choose an account based on a £10 monthly fee. The cash tariff can dwarf the account fee. A consultant receiving every payment electronically has a completely different cost profile.
Lloyds still works well when your business is not 100% digital
Lloyds supports cheque deposits through the Business Banking app as well as self-service machines and branches.
Cheque deposits through the app or an Immediate Deposit Machine currently cost 85p per cheque, compared with £1.20 over the counter.
The advantage is not that cheques are free. It is that Lloyds gives businesses several ways to deal with them without forcing every transaction through a purely app-based model.
That flexibility can matter for trades, professional services, charities and established firms that still receive occasional cheques or need branch support.
What can the Lloyds Business Banking app do?
Lloyds’ app and online banking cover the everyday jobs most small firms need.
- Make and receive UK payments.
- Send up to £250,000 a day, subject to account and security limits.
- Pay in eligible cheques using the app.
- See real-time payment notifications.
- View upcoming and scheduled payments.
- Share and store receipts.
- Add multiple users, including directors, accountants and team members.
- Send and receive international payments.
- Access 24/7 digital support.
The latest independent SME survey is useful here: 73% of Lloyds customers surveyed recommended its online and mobile banking services, placing Lloyds equal sixth in the August 2026 results.
That is respectable, but still behind Monzo at 90% and Starling at 87%.
Xero, accounting exports and free MTD software
Lloyds lets businesses export transaction data for major accounting platforms including Xero and QuickBooks.
The current account-opening promotion also includes six months of Xero for qualifying new customers.
Making Tax Digital for sole traders
Lloyds is also offering HMRC-recognised Making Tax Digital for Income Tax software free to eligible Business Account customers whose businesses fall within the new rules.
That is particularly relevant following the April 2026 expansion of Making Tax Digital for Income Tax.
If accounting software is an important part of the decision, compare our accounting software guide rather than choosing purely on a temporary banking promotion.
Lloyds has more lending depth than most app-only accounts
Lloyds offers business overdrafts, loans, credit cards, asset finance and other borrowing options, all subject to eligibility and credit assessment.
For some new businesses, Lloyds currently advertises an instant credit decision on smaller borrowing even without a long trading history. Established businesses can access a wider lending range.
This is one of the reasons a traditional bank can become more useful as a business grows.
Do not choose the current account because you assume borrowing will be approved
A bank offering business loans does not mean your company will qualify for one. If an overdraft or loan is central to the switch, discuss the borrowing separately before moving the operating account.
Is Lloyds good for international business?
Lloyds supports international payments and foreign-currency accounts, which is useful for businesses that only occasionally trade overseas.
A standard international payment sent through Internet Banking currently costs £15. Sending the same type of payment in a branch costs more, and correspondent-bank charges or foreign-exchange costs may also apply.
Lloyds also offers euro and other foreign-currency current accounts for businesses that need them.
For occasional international suppliers, this is workable. For a company converting currencies every day, Revolut Business or Wise deserves a direct cost comparison.
What do the independent 2026 service results say?
The August 2026 independent business-current-account survey gives a more nuanced picture than generic review-site ratings.
| Service category | Lloyds result | Position |
|---|---|---|
| Overall service quality | 60% | Equal 10th |
| Online and mobile banking | 73% | Equal 6th |
| SME overdraft and loan services | 60% | Equal 5th |
| Relationship / account management | 57% | 14th |
| Branches and business centres | 53% | Equal 4th |
The takeaway is that Lloyds performs better in specific channels than its overall recommendation score suggests, but the challenger banks still lead strongly on digital satisfaction.
Is Lloyds Business Banking FSCS protected?
Eligible money held with Lloyds Bank can be protected by the Financial Services Compensation Scheme up to £120,000, subject to FSCS eligibility rules.
The older £85,000 figure that appears across many historic business-bank reviews is no longer current.
If your company regularly holds significant surplus cash, compare the rates and protection structure in our business savings accounts guide.
Which businesses are a good fit?
Startups wanting a traditional bank
Twelve months without an account fee, current rewards and access to wider banking products make the first year attractive.
Growing limited companies
Borrowing, credit cards, savings, payment acceptance and multiple-user access give Lloyds more room to grow with the company.
Businesses that still use branches or cheques
Lloyds provides several deposit and support channels rather than forcing everything through an app.
Sole traders preparing for MTD
Free HMRC-recognised Making Tax Digital software can be useful where the business falls within the Income Tax requirements.
When Lloyds may not be the best fit
- Businesses wanting permanent £0 banking: Starling or Monzo Lite may be more attractive after Lloyds’ first year ends.
- Cash-heavy businesses: cash handling can cost far more than the headline monthly account fee.
- Businesses obsessed with app experience: Monzo and Starling score higher in the independent digital-banking survey.
- International companies: Revolut Business or Wise may offer more competitive multi-currency tools.
- Owners who will never use lending, branches or wider banking products: much of Lloyds’ traditional-bank advantage may be wasted.
How Lloyds compares with Starling, Monzo, Tide and Revolut
| Provider | Starting monthly cost | Best for | Biggest strength |
|---|---|---|---|
| Lloyds | £0 for 12 months, then £10 | SMEs wanting traditional banking plus strong digital access | Broad product range, branches and borrowing |
| Starling | £0 | UK-focused digital SMEs | Excellent free account with invoicing and built-in accounting |
| Monzo Business | Lite £0 | App-first sole traders and small companies | Best-in-class digital experience and useful paid admin tools |
| Tide | Free £0 | Sole traders and SMEs wanting business admin tools | Broad small-business ecosystem |
| Revolut Business | Basic £10/month | International incorporated businesses | Multi-currency banking and FX allowances |
Read our Starling review, Monzo review, Tide review and Revolut Business review for the detail.
Lloyds Business Account pros and cons
Pros
- No account fee for the first 12 months.
- Electronic payments included at no extra cost.
- Current limited-time rewards package worth up to £400 plus six months of Xero.
- Branch, app, online and telephone banking.
- Free MTD software for eligible sole traders.
- Wide range of borrowing, savings and card products.
- Multiple users can be added to the account.
- Eligible FSCS protection up to £120,000.
Cons
- £10 monthly account fee after the first year.
- Cash handling can be expensive.
- Cheques carry per-item charges.
- International transfers can be cheaper elsewhere.
- Overall SME recommendation score trails leading challenger banks.
- The most attractive rewards are temporary promotions rather than permanent account features.
What should you calculate first?
- Your cash deposits: work out the cost using your normal month, not an unusually quiet one.
- The second-year cost: include £120 a year of account fees once the introductory period ends.
- Cheques: count how many you actually bank and which channel you would use.
- International payments: compare the £15 online payment charge and FX costs if overseas suppliers matter.
- Borrowing: discuss any overdraft requirement separately before switching.
- Accounting: decide whether Xero or the free MTD software has real value for your business.
- Promotions: meet the offer conditions only if the underlying account still makes sense without the reward.
Lloyds Business Account FAQs
How much is the Lloyds Business Account?
There is currently no monthly account fee for the first 12 months if it is your first Lloyds Business Account. After that, the monthly fee is £10.
Are Lloyds electronic business payments free?
Everyday electronic payments are included at no extra cost. These include Direct Debits, standing orders, Faster Payments debits and Internet or PhoneBank debits.
How much does Lloyds charge for cash deposits?
Cash paid in through an Immediate Deposit Machine or similar self-service device currently costs 85p per £100. Cash paid in over the counter costs £1.60 per £100.
Is Lloyds Business Banking FSCS protected?
Eligible deposits with Lloyds can be protected by the FSCS up to £120,000, subject to the scheme’s eligibility rules.
Does Lloyds Business work with Xero?
Transaction data can be exported for use with Xero and other major accounting platforms. Lloyds is also currently offering six months of Xero to eligible new Business Account customers under its limited-time promotion.
Can a sole trader open a Lloyds Business Account?
Yes. Lloyds’ Business Account is available to eligible sole traders as well as startups, small businesses and limited companies with annual turnover below £3 million.
Lloyds works best for businesses that value the wider banking relationship
Lloyds is not the cheapest long-term business account, but price is only one part of the decision.
The first year is attractive: no account fee, free electronic payments and, at the time of this update, a generous rewards and Xero promotion.
From year two, £10 a month makes the comparison tougher against Starling and Monzo Lite. Cash and cheque charges also mean retailers and other cash-heavy businesses need to calculate the real cost carefully.
Where Lloyds earns its place is breadth. If you want a recognisable UK bank that can handle everyday banking today and potentially provide savings, cards, merchant services, foreign-currency accounts and borrowing later, it remains a credible choice.
Compare Lloyds with other UK business accounts
Compare monthly fees, cash handling, accounting tools, international payments, borrowing and support before choosing where to run your business banking.
Eligibility, charges and promotional offers can change. Check current Lloyds terms before applying.
Other business accounts for UK SMEs
If Lloyds’ traditional-bank model is not the right fit, compare these alternatives.
Revolut Business
- Basic from £10/month
- 25+ currencies
- Strong for international companies
Wise Business
- International payments focus
- Multi-currency features
- Useful alongside a main UK bank
