Live Oak Bank Review: Business Banking [2024]: Banking for Small Business Owners

BANKING - BANK REVIEWS
Live Oak Bank offers business accounts and simple banking with good interest rates on savings and CD accounts. But the lack of features may leave customers seeking out other options.
Updated May 22, 2024
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Live Oak Bank is an online-only bank offering business savings accounts and CDs with competitive interest rates. While Live Oak Bank also offers personal savings and business checking, its strength is focusing on small business owners who need a place to save and grow their money.

We recommend Live Oak for those looking to have their business savings earn a high interest rate and for people who want a basic, online savings account that interfaces with accounts at other banks. Some drawbacks, such as being unable to accept cash deposits, should be considered before opening an account, however.

Learn more in this Live Oak Bank business savings review.

In this Live Oak Bank Business Banking review

Key takeaways

  • Live Oak Bank offers high interest rates on its business savings accounts.
  • Live Oak Bank is online only and does not have physical branches.
  • While Live Oak Bank does not have account minimums or maintenance fees on savings accounts, other fees may apply.
  • Account transfers are limited to six per month, and if you go over this limit three times in twelve months, your account may be closed.

Live Oak Bank: Is it worth it?

Pros Cons
  • Competitive interest rates on business savings
  • No account minimums or maintenance fees on business savings
  • The Insured Cash Sweep program provides up to $10 million in FDIC coverage
  • Some of the highest available interest rates on 1-year term CD accounts
  • Online-only banking experience
  • Cash deposits not accepted
  • Only six transfers allowed per monthly billing cycle
  • Debit cards available for business checking accounts only
  • Customers report multiple glitches on the Live Oak Bank mobile apps
Our verdict: Live Oak Bank is a good option for those seeking a simple business savings account that connects to an outside financial institution. While it offers high-interest rates and no maintenance or monthly fees on savings or CD accounts, it does impose transaction limits, and some of its features are relatively basic compared to other banks.

What is Live Oak Bank?

Live Oak Bank has over 900 employees and, in the fall of 2022, announced plans to expand its Wilmington, North Carolina, campus where it was established in 2008. It is a cloud-based, online-only bank for entrepreneurs and small business owners and is available to customers in all 50 states. While it does have some personal banking products, they are limited.

Live Oak Bank states that its mission is to be America’s small business bank. It ranked first in the Small Business Association (SBA) 7(a) lender by dollar volume during FY 2022 and works with the U.S. Department of Agriculture to provide loans to small farmers and others.

Live Oak Bank offers customers a safe place to keep their cash reserves through high-yield business savings accounts or certificates of deposit (CDs). It offers competitive interest rates on its savings and 1-year CD accounts, and all deposits are FDIC insured up to $250,000 per depositor for each type of account held at Live Oak Bank.

Tip
You can reach Live Oak Bank customer support at 866-518-0286 from 8 a.m. to 8 p.m. Eastern Monday through Friday.

Live Oak Bank also has mobile apps for iOS and Android devices. Unfortunately, neither app rates highly, earning just 2.6 out of 5 stars on the App Store and 3.2 out of 5 on the Google Play Store.

Live Oak Bank small business checking account

Annual Percentage Yield (APY): Not offered on checking accounts

Account minimum: $0

Monthly maintenance fees: $10/month; Monthly fee waived with $1,000 average daily balance

Live Oak’s small business checking account does not have a minimum opening deposit requirement. Accounts not funded within 14 days of creation may be subject to closure.

Additionally, some transactions may incur fees, such as sending a wire transfer, which will cost you $19. Live Oak Bank also has a $2,500 daily purchase limit and a $1,000 daily ATM withdrawal limit on their business checking accounts.

Unlike some of the best banks with physical locations, Live Oak Bank customers can only access the funds in their checking account through a Mastercard-branded debit card or ATMs operated by the AllPoint Network. Paper checks are unavailable, though funds can be sent via ACH transfer or wired to your linked external account or a third-party account.

One of the primary drawbacks to a Live Oak Bank checking account is that it does not accept cash deposits. While this may be fine if your business is exclusively online, those who operate cash businesses are out of luck. Funds can only be deposited online or through the mobile app using a linked external bank account.

Live Oak small business checking screenshot

Live Oak Bank business savings account

Account minimum: $0

Monthly maintenance fees: $0

For business owners with an established checking account who want to earn higher savings rates, a Live Oak business savings account may be a good option.

The Live Oak Bank savings account has very competitive rates currently available and does not charge a monthly maintenance fee or have an account minimum.

Specific fees may apply, however, for stop payments ($25), returned items ($5), or a dormant account if there is no activity for 24 months and the account balance is less than $10.01.

Interest on your funds compounds daily and is applied to your account once per month. Transfers from this savings account to a checking or outside account are limited to six per month, and a fee may be applied if you exceed that limit.

Insured Cash Sweep

For businesses with over $250,000 in assets, Live Oak Bank offers the Insured Cash Sweep program, which provides FDIC insurance coverage up to $10 million.

To do this, Live Oak Bank partners with a network of FDIC-insured banks participating in the IntraFi Network. Deposits of up to $250,000 are disbursed among member banks but are managed through a dedicated business banker at Live Oak Bank.

Each account earns the current interest rate offered by Live Oak Bank, no matter which bank within the IntraFi Network holds your funds.

Live Oak Bank CDs

APY: 2.00%-5.00% (as of May 8, 2023)

Account minimum: $2,500

Terms available: 3, 6, 9, 12, and 18 months and 2-, 3-, 4-, and 5-year options

Customers looking to invest in CDs at Live Oak Bank must meet the account minimum of $2,500 (the limit is $250,000). Users can add authorized signers, select their interest disbursement preferences, or set automatic renewals when a CD reaches the term requirement after the CD account is created and funded.

While Live Oak doesn’t charge a monthly interest disbursement fee or online banking fee, you'll face early withdrawal penalties if you need to withdraw funds from your CD before the selected term ends.

If you withdraw funds from a CD with a period of less than 24 months, you’ll pay 90 days of simple interest (not compound). If your CD term exceeds 24 months, you’ll pay 180 days of simple interest for early withdrawal.

Other Live Oak Bank offerings

Live Oak Bank provides small business loans starting at $150,000. It offers loans from the Small Business Association (SBA) or the U.S. Department of Agriculture, each with different terms and requirements. Commercial loans are also available and customized to help businesses expand with new equipment, build facilities from the ground up, or purchase an existing business or franchise.

Live Oak Bank also offers high-yield savings accounts and CDs for individuals through its personal banking services. Its personal CD rates are currently the same as business accounts 2.00%-5.00% (as of May 8, 2023) on CDs, with additional terms available. Personal savings accounts have an APY 4.40% .

However, Live Oak Bank does not offer a personal checking account option and does not have a personal debit card or ATM. All accounts are funded via an externally linked bank account, and funds can be transferred via ACH or wire using the mobile app or online. Paper checks can be deposited via mobile app or sent to Live Oak Bank headquarters.

How to get started with Live Oak Bank

Screenshot of Live Oak Bank options

Signing up for a new account with Live Oak Bank is relatively easy. To make the process as simple as possible, you’ll need to have some information and documents gathered in advance. For example:

  • Your full name
  • Address
  • Phone number and email address
  • Birthdate
  • Social Security Number
  • External bank account and routing number
  • Article of Organization document
  • Business EIN
  1. Visit liveoakbank.com and hit the “Get Started” button.
  2. Supply the requested personal and business information and verify your identity.
  3. Link your external bank account.
  4. Fund your account. (Note that the deposit will be held for five business days while verifying your identity.)
  5. Once the deposit is available, add authorized signers to the account if applicable.
  6. If purchasing a CD, set up your interest disbursement preferences and select an auto-renewing option for the end of the CD term.

Alternatives to Live Oak Bank: Axos Bank and Grasshopper

Live Oak Bank’s interest rates on business savings and CD accounts are hard to beat. But its account transfer limits and inability to take cash deposits could make it hard to justify banking with them, especially if your business is primarily cash-based.

Two alternatives to consider are Axos Bank and Grasshopper.

Axos Bank is an online-only bank offering products similar to Live Oak Bank and others, like business money market accounts.

Although the interest rates on savings and CDs are significantly lower than Live Oak Bank, it does offer more robust personal and business banking options. Axos Bank also has accounts with no monthly maintenance fees and a business checking account offering 1.01% (as of Sep. 13, 2023) with an average daily balance of $5,000.

Customers interested in a business saving account  at Axos should note the $1,000 minimum deposit and $2,500 minimum daily balance on the Business Savings account. However, the Premium Business Savings account does not have a minimum deposit and no maintenance fees or daily balance requirements.

Grasshopper Bank is another online banking option that only offers business checking accounts. Customers only need $100 as an initial deposit, and no minimum balance requirement or monthly maintenance fees are charged.

Customers can earn up to 2.25% (as of May 9, 2023) on checking accounts. Unlike Live Oak Bank, Grasshopper offers unlimited transfers via ACH and wire.

Live Oak Bank Axos Bank Grasshopper
Business Banking Options
  • Checking
  • Savings
  • CDs
  • Business loans
  • Checking
  • Savings
  • CDs
  • Money Market
  • Checking
Personal Banking Options
  • Savings
  • CDs
  • Checking
  • Savings
  • CD
  • Money Market
  • Mortgages
  • None
Minimum Opening Deposit
  • Business Checking: $0
  • Savings: $0
  • CDs: $2,500
  • Interest-earning checking account: $5,000
  • Business Premium Savings: $0 and no daily account minimum
  • Regular Business Savings: $1,000 minimum opening balance and $2,500 daily balance required
  • $100 for Business Checking
Interest Rate on Business CDs
  • 2.00%-5.00% (as of May 8, 2023)
  • 0.10%-0.20% (as of May 16, 2024)
  • None

FAQs about Live Oak Bank

Is Live Oak Bank a reputable bank?

Yes, Live Oak Bank is a reputable bank based in North Carolina and offers personal and business accounts with high-interest rates. Deposits at Live Oak Bank are FDIC-insured up to $250,000. 

Is it good to have a business savings account?

Keeping your personal and business accounts separate is recommended if you run a small business. Doing so protects your personal assets and helps you keep better (and cleaner) records.

While many people choose to use a business checking account, a business savings account can be a good option if you find a high interest rate with minimal or no fees. Before signing up with a bank, pay attention to monthly transaction limits or other account fees.

What is the minimum balance requirement for a business savings account?

The minimum balance requirement for a business savings account will vary from bank to bank. Some banks don’t require any minimum deposit, while others may require thousands of dollars.

At Live Oak Bank, no minimum balance is required to open a business savings account, and there is no minimum daily balance fee. To create an account, you must link an external bank account and make a deposit within 14 days of account creation, or your account may be canceled.

Live Oak Bank review: bottom line

Live Oak Bank offers impressive interest rates for its business savings and CD accounts. However, its lack of features and account options can make other banks more attractive, even if you earn less interest.

To find the best savings account for your situation, compare multiple options, including traditional and online-only banks. Check for the best interest rates, low or no fees, account minimums, and look for hidden fees and transfer limits.

Live Oak - Personal Savings Benefits

  • Earn 4.40% APY on your money1
  • Daily compounding interest to maximize your earning potential
  • No online banking or monthly maintenance fees
  • FDIC insured up to $250,000

Author Details

Kate Daugherty Kate Daugherty is a professional writer with a passion for providing others the head start they deserve on their financial journeys. Largely self-taught, Kate relied on books, blogs, and trial-and-error to learn how to budget and save for the future, all while working to pay back about $15,000 in student loans.