Starting a new business is not for the faint of heart. There is a lot of work that goes into it, and many startups don’t even break even for the first several years. Additionally, startups have unique needs when it comes to banking services.
Traditional business accounts don’t always cater to a startup business. They often have many fees and limited features. That’s where Mercury Bank claims to help. They have designed their platform with the startup business in mind. So, what exactly does that mean? In this Mercury Bank review, we will look at everything you need to know about this banking service, from what they offer to their pros and cons, and more.
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What is Mercury Bank?
Mercury Bank is a financial technology company that offers startups access to business banking accounts and tools to manage their cash flow. Jason Zhang, Max Tagher, and Immad Akhund founded Mercury in April 2019.
Mercury’s banking platform is built on SynapseFi. Due to this, the features are similar to RelayFi.
What makes a Mercury business bank account different from others is that they are fee-free. Companies that have more than $250k in their account will have their money invested into low-risk securities (i.e., Treasury Bonds).
Mercury is not a bank itself. They partner with Evolve Bank to offer its banking services. Customers receive the benefit of having FDIC insurance on their account balances through this partnership.
What Does Mercury Bank offer?
Checking and Savings account
Opening up a bank account with Mercury automatically sets you up with a checking and savings account. There are no monthly fees for these accounts.
There are two tiers of bank accounts that have different account balance requirements. All bank accounts include API access, team management tools, virtual cards, and third-party software integration.
Mercury Standard Bank Account
With this Mercury account, there are no minimum balance requirements to open. You get free checking and savings. However, the savings account does not earn interest.
You can send money using ACH transfers and checks. Domestic and USB international wires are also free. There is a 1% fee on currency exchanges.
Other banking features included with the Standard bank account are a debit card, cash flow analytics, and searchable transaction history.
Mercury Tea Room Bank Account
You must have a combined balance in your Mercury Bank accounts that’s at least $250,000.
At this tier, you get all the features that come with a Standard account. Additionally, you get a dedicated phone support line, access to events, and actual tea sent to you.
Mercury Tea room account holders also get Mercury Treasury. However, the beta is closed at this time. Mercury Treasury basically puts your extra has into safe securities, which we’ll explain in the next section.
Mercury Bank Features
As an online-only bank, Mercury Bank does not have any physical locations. Most users will use its mobile banking app to manage their accounts.
Using the app, you can send money via ACH or wire transfers, look over transactions, make mobile check deposits, and more.
The app is available on iOS and Android devices.
Mercury Bank’s platform is a completely online bank. Hence, there are no physical locations. Other than the mobile app, you can use a desktop to access its platform.
Your Mercury Bank account comes with digital tools that give you the ability to send and receive online payments, cash-flow analytics, monitor spending, and track transactions. You can create virtual debit cards as well.
Managing your debit card is easy with the mobile app. You can change your spending limits, add it to your mobile wallet, or freeze your card.
Mercury allows you to add more team members to your Mercury account. There are two user access options. If you add admins as users, they can move money, receive a physical debit card, change permission, and add users as bookkeepers.
Mercury accounts can also be integrated into third-party business tools like QuickBooks, Stripe, PayPal, and Shopify.
Secure Service Provider
Mercury Bank has all the top security features to protect your account. They have two-factor authentication, strong bcrypt algorithm passwords, enhanced browser security, and conduct third-party vulnerability testing.
In addition, they have database and image encryption with additional encryption for sensitive data and information.
Access to ATMs
Brick and mortar banks have the convenience of locations to gain access to cash from your account. Mercury works with the Allpoint network, which has over 55,000 locations across the U.S.
These locations allow you to access fee-free cash withdrawals.
Payment Card Capabilities
Your business gets flexible banking features that can grow as it does. Each user gets a physical debit card to use. You can create up to 50 virtual cards. The card control features available are robust.
For example, Mercury supports Apple Pay and other wireless forms of payment. Your debit card can be used at international and domestic ATMs.
There are no additional international transaction fees that are charged by Mercury on top of the ATM operator charges.
The virtual cards are easy to fast to create on the mobile app. You can assign a certain user with a specific sub-account. It typically takes about a minute to get a card active.
Mercury’s partner bank is Evolve Bank & Trust, which provides the FDIC insurance on your business checking account. You automatically receive a savings account too. You can make up to six outgoing transactions a month on your savings account.
Your business banking account has read-write API access. This means that developers can access its banking software which is a feature that startups and tech-centered businesses generally want.
This allows you to customize and automate your Mercury account. You can design internal dashboards, create transfer rules, reconcile transitions, and make bulk payments.
With a Tea Room bank account, your extra cash goes into U.S. Government securities and money market funds. These types of investments are less risky, though the yield is low.
Mercury Bank has closed its beta on this service, however. There’s no information on when it will open back up.
Mercury Bank provides deals for startups that are looking for different tools. Accounting, advertising, communication, developer tools, e-commerce, finance, funding, hosting, human resources, insurance, productivity, sales & marketing, and security are among the different partner rewards you can choose from.
The benefit is typically a percentage off its services or free service for a month. Companies that are starting their business can find many of the digital tools and services they need.
A recent offering that Mercury Bank has is its Venture Debt. If your start has raised venture capital in the past year or planning to soon, you can apply for venture debt.
They lend to VC-funded companies found across industries and stages.
Who is a Mercury Bank Account Best For?
Mercury Bank gears its services to tech companies and start-ups. Essentially, they are a modern bank that’s best for businesses that don’t use physical cash.
Hence, if your business relies mostly on digital transactions, you’ll get the most out of its account.
Mercury Bank does not provide its services to sole proprietors or trusts. Additionally, the following types of businesses are prohibited from applying for an account:
- Adult entertainment
- Internet gambling
- Money services businesses
Opening a Mercury Bank Account
To start an account, you can visit the Mercury Bank website and click on “Open Account.” You’ll need to fill out information like first name, last name, work email address, and create a password.
You’ll also need the necessary documents to show proof of your business and that it is based in the U.S. Specific items that Mercury Bank requires includes your federal employer identification number (EIN), the company’s official formation documents, and a government I.D. A driver’s license or passport, for example.
Mercury Bank Pros
Application Process is Fast and Streamlined
When you open an account with Mercury Bank, it’s a very easy process. You need your articles of incorporation and EIN number to complete the online application.
It takes minutes to open an account. This is exceptionally fast as the process of opening up business bank accounts is difficult with a traditional financial institution.
Mercury has a partnership with Allpoint to enable its customer to access ATMs across the country. Even if you find yourself overseas and need to withdraw cash, there’s probably an option close by.
Mercury Bank won’t charge you extra for international cash withdrawals other than what the operator does.
Not many Fees
You don’t have hidden fees, monthly fees, or minimum balance fees with Mercury Bank. There are also no overdraft fees. This is true for both Standard and Tea Room customers.
There are free domestic wires. International wires transfers are free to receive and send as well.
Layers of Account Access
Account-holders can enable different layers of access to different users on their accounts. For example, if they have a bookkeeper, that individual can get all the information they need for posting transactions and accounting. They wouldn’t have access to funds.
Mercury Tea Room account gives access to Money Market Funds
The beta for this unique service is currently closed. Hopefully, they will open it up in the near future. Basically, Mercury tea room accounts can take advantage of Mercury’s Treasury portfolios to invest their “extra cash” and earn a return.
Tea Room accounts receive some interesting perks with their checking and savings accounts. You get discounts on various software integrations and even free tea.
Mercury Bank Cons
Sole Proprietors can’t Open an Account
Mercury Bank doesn’t allow sole proprietors to open an account with them. With the vast majority of businesses made up of non-employer and small businesses, that’s a huge chunk of people who can’t receive their banking services.
Mercury Bank does say that it is designed for start-ups. Excluding sole proprietors seems a bit counterintuitive, though.
No Cash Deposits
Mercury Bank does not have the capability to accept cash deposits. Some of its online bank competitors can accept cash deposits through partnerships.
This could affect certain businesses that handle money more frequently and need the ability to deposit cash.
Savings Rate Earning is Low
You’re basically getting a near 0% savings rate on your business savings account with Mercury. There are online competitors that offer better rates on their interest-bearing business accounts.
Even if you have Mercury Treasury, the earning rate is currently up to 0.08% annually.
FAQ: Mercury Bank Review
Does Mercury Bank offer useful account features?
Mercury offers many valuable features to its customers. In particular, its ability to provide various users with different levels of access and payment card capabilities. It offers an automated cash management account that allows users to monitor spending, provides cash-flow data, tracks transactions, and more.
Is Mercury Bank affordable?
There are no fees for wire transfers, overdrafts, monthly charges, or minimum balances. International wire transfers are also free. Especially for a business banking account, the absence of fees is surprising.
Is Mercury Bank easy to use?
As a digital-only bank, Mercury has done a great job of creating an exceptional online experience. Signing up for an account is easy and painless. Managing your account on a daily basis is seamless and fast.
Both the iOS and Android mobile apps have received favorable reviews from users.
Does Mercury Bank offer good customer service?
Customer support is all online and remote. You can send general questions or comments to firstname.lastname@example.org. There is also a FAQ page that has basic answers to popular questions.
If you have a specific question related to your account, you’ll need to log into your account.
With a Tea Room account, you’ll have access to a special customer service line to help with your questions or business needs.
Bottom Line: Mercury Bank Review
While there are tons of banking apps out there, from Current Bank to the Albert App, Mercury Bank stands out for its focus on helping startup businesses tackle their expenses and banking needs. The banking tools that Mercury bank offers are solid and very useful for businesses that are starting out. There are no monthly fees or maintenance fees that you typically expect from a business account.
However, it is not available to sole proprietors or trusts, which rules many businesses out. It is also not a bank for businesses that deal a lot with cash.
For businesses that fit the type of customers that Mercury is designed for (start-ups and tech companies), its platform is a great solution.