Choosing the right bank for your business is a significant decision, with potential impacts on your financial management, customer relations, and growth prospects. Two leading players in the UK business banking sector are Lloyds Bank vs RBS (Royal Bank of Scotland).
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Both have strong reputations and offer comprehensive services. However, there are notable differences that may influence your preference. This article will compare these two banking giants, focusing on their offerings for businesses.
Lloyds vs RBS
| Feature | Lloyds Bank | RBS |
|---|---|---|
| Internet Banking | Offers secure 24/7 internet banking via their online platform | Offers internet banking services with additional cybersecurity measures |
| Mobile Banking | Mobile banking app available on iOS and Android devices, offering full suite of services | Mobile app available with features like invoice scanning and budget tracking |
| Overdraft Facilities | Offers arranged and unarranged overdrafts with variable interest rates | Overdrafts available, with interest rates based on business assessment |
| Business Credit Card | Offers a range of cards with varying benefits like Avios points and no annual fees for the first year | Variety of cards available, each tailored to different business needs and sizes |
| Business Loans | Offers loans with fixed or variable rates for business expansion or equipment purchase | Provides both secured and unsecured business loans, including enterprise finance guarantee loans |
| Trade Services | Offers services like letters of credit, documentary collections and guarantees | Provides international trade services including import/export letters of credit and trade finance |
| Invoice Finance | Invoice discounting and factoring services available | Offers invoice financing and discounting, and asset-based lending |
| Business Insurance | Comprehensive range of business insurance products, including liability and professional indemnity insurance | Range of business insurance options, including business interruption and public liability insurance |
| Asset Finance | Leasing and Hire Purchase available for equipment and vehicles | Offers hire purchase, leasing, and refinancing options |
| International Services | Foreign exchange services, international payments and trade finance available | Provides international trade services, foreign exchange and multi-currency account options |
| Business Savings Account | Offers instant access, notice and fixed term savings accounts | Variety of business savings accounts including instant access and fixed term accounts |
| Business Investment Products | Range of investment options including unit trusts and bonds | Provides different investment opportunities, tailored to business size and needs |
| Cash Management Services | Cash handling, payment and collection services, and liquidity management offered | Provides cash management including efficient payment solutions and cash flow optimisation |
| Merchant Services | Card machines, online and phone payments, and point of sale finance offered | Range of merchant services including card terminals and secure online payment systems |
| Payroll Services | Offers payroll solutions in collaboration with Ceridian and Sage | Provides cloud-based payroll solutions in association with FreeAgent |
| Dedicated Relationship Manager | Every business customer is assigned a relationship manager | Dedicated relationship manager service provided based on the business size and requirements |
| 24/7 Customer Support | Provides 24/7 customer service via phone and online chat | Offers 24/7 customer support through various channels including live chat and phone |
| Financial Advice | Offers financial and growth advice tailored to your business sector | Provides financial advisory services including cash flow management and expansion planning |
| Digital Training and Support | Lloyds Digital Academy provides free digital skills training | Provides digital skills training and online resources for businesses |
| Tailored Solutions for Different Sectors | Solutions tailored for sectors like agriculture, healthcare, manufacturing, etc. | Offers sector-specific financial solutions, with expertise in healthcare, manufacturing, agriculture, etc. |
 | Tide Business Bank Accounts ✓ Free, Plus, or Pro Account ✓ iOS & Android Mobile App ✓ Upload & Auto-Match Receipts Pricing Trial period Contact | |
 | Card One Money ✓ No Credit Checks ✓ Simple Fees ✓ Up To 3.5% Cashback Pricing Trial period Contact | |
 | ANNA Money ✓ Apply In 10 Minutes ✓ Bookkeeping & Payroll Tools ✓ User-Friendly Mobile App Pricing Trial period Contact | |
 | HSBC Business Banking ✓ Business Current Account ✓ In-Branch, Online & App Banking ✓ FSCS Protected Pricing Trial period Contact | |
 | Metro Business Banking ✓ Business Current Account ✓ High Street Presence ✓ FSCS Protected Pricing Trial period Contact | |
 | Mettle Business Banking ✓ Business Bank Account ✓ Online & App ✓ Quick & Easy Application Process Pricing Trial period Contact | |
 | Monzo Business Banking ✓ Business Current Account ✓ Dedicated mobile app experience ✓ FSCS Protected Pricing Trial period Contact | |
 | Virgin Money ✓ Business M Account ✓ In-Store, Online & App Banking ✓ Insights & Forecasting Platform Pricing Trial period Contact |
Lloyds Bank
With a history dating back to 1765, Lloyds Bank has a longstanding reputation as a strong choice for businesses of all sizes. They pride themselves on their digital banking services, excellent customer service, and tailored offerings for various sectors.
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Pros and cons
Pros
- Lloyds offers a comprehensive range of services from traditional banking services to complex financial products and advice.
- Lloyds is well-known for its efficient digital banking platform, making it easy for businesses to manage their finances.
- The bank’s relationship managers are particularly praised for their responsiveness and expertise.
- Their financial advice and training resources can be extremely beneficial for businesses looking to grow.
Cons
- Some customers have reported that Lloyds’ fees can be higher than other banks.
- While their online platform is robust, occasional technical glitches have been reported.
- While their service is generally well-regarded, some customers report uneven service quality across different branches.
Table of fees and charges
| Fee Type | Amount/Rate |
|---|---|
| Business Current Account | £6.50 monthly fee |
| Electronic Payments | Free |
| Cheque Payments | £0.65 per cheque |
| Cash Payments | 0.6% of cash amount |
| Overdraft Facility | Variable |
| Business Credit Card | £32 annual fee |
Note: The fees and charges are subject to change and vary depending on the specific services and account types. Always verify with the bank for the most accurate information.
Unique and standout features
Lloyds has several unique features that set it apart:
- Lloyds Digital Academy: This platform offers free digital skills training, which can be particularly useful for businesses looking to improve their digital capabilities.
- Lloyds Bank Mentor Service: This service offers advice on topics like employment law and health & safety, helping businesses stay compliant.
- Sustainable Finance: Lloyds offers tailored solutions to support sustainable businesses and projects, reflecting its commitment to environmental responsibility.
RBS
The Royal Bank of Scotland (RBS), established in 1727, has a longstanding tradition of serving businesses in the UK. RBS stands out with its focus on customer service, sector-specific solutions, and innovative banking technology.
Pros and cons
Pros
- RBS offers a wide array of financial products suitable for businesses of all sizes and sectors.
- RBS has a user-friendly mobile and online banking platform.
- The bank is known for its proactive customer service, with dedicated relationship managers for business customers.
- RBS offers a number of specialized financial solutions for different sectors, such as healthcare and agriculture.
Cons
- RBS sometimes falls short in terms of speed, with some customers reporting delays in transactions.
- While their customer service is generally praised, some customers have had negative experiences with service consistency.
- Some customers have reported their business loan approval process to be more stringent and lengthy.
Table of fees and charges
| Fee Type | Amount/Rate |
|---|---|
| Business Current Account | £5 monthly fee |
| Electronic Payments | Free |
| Cheque Payments | £0.70 per cheque |
| Cash Payments | 0.65% of cash amount |
| Overdraft Facility | Variable |
| Business Credit Card | £30 annual fee |
Note: The fees and charges are subject to change and vary depending on the specific services and account types. Always verify with the bank for the most accurate information.
Unique and standout features
RBS has several features that set it apart:
- Entrepreneur Accelerator Hub: This is an innovative program providing mentorship, workspace, and networking opportunities for startups.
- RBS Invoice Finance: RBS offers a robust invoice financing service, providing businesses with a flexible way to manage cash flow.
- Sector Expertise: RBS has dedicated teams for sectors like agriculture, healthcare, and real estate, providing expert advice and tailored solutions.
Conclusion – Lloyds Bank vs RBS
Both Lloyds and RBS provide comprehensive business banking services with a suite of products and features designed to serve businesses of all sizes.
While both banks have their unique strengths, your choice should ultimately depend on your specific needs, preferences, and business goals.
For example, if your business could benefit from digital training resources, Lloyds may be the better choice with its Digital Academy.
However, if you are an entrepreneur looking for robust start-up support, RBS’s Entrepreneur Accelerator Hub might sway your decision in their favour.
FAQ
While both banks offer business accounts, they typically come with a monthly fee. However, they often provide an initial period of free banking for new businesses.
Yes, both Lloyds and RBS provide dedicated relationship managers to help manage your business finances.
Yes, both banks provide the option to apply for a business bank account online.
Yes, both Lloyds and RBS provide sector-specific solutions, with a focus on sectors such as agriculture, healthcare, and real estate.
Both banks provide support for startups, with Lloyds offering a range of digital tools and resources, and RBS providing a comprehensive Entrepreneur Accelerator Hub.
Yes, both Lloyds and RBS use advanced security measures to ensure the safety of their digital banking platforms. Always remember to follow the best practices for online security.
Yes, both banks provide a suite of international banking services to support businesses with overseas operations or transactions.