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

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.

See where Live Oak Bank is a good fit for business owners and where it falls short so you can decide if it will work for your financing needs.

Who is Live Oak Bank best for?

Live Oak Bank shines in its small business financing, especially its Small Business Association (SBA), USDA, and commercial loans. It is particularly well-suited for entrepreneurs and small business owners seeking capital to grow their ventures without the stringent requirements often associated with traditional banks.

Business owners will also benefit from the competitively high interest rates offered on the business savings and CDs. Additionally, the business checking account requires no minimum balance and account fees are waived if you maintain a daily balance. For the Business Plus and Business Plus Analysis accounts, FDIC insurance coverage is extended up to $10 million with no additional fee.

When Live Oak Bank may not be the best fit

There are some downsides of using Live Oak Bank for your business needs, however. There are no in-person branches or ways to deposit cash. This can make it difficult to manage if your business has a steady stream of cash coming in, such as a restaurant or other tips-based business.

This bank is also not the best fit for those looking to manage their personal finances. While Live Oak Bank offers high interest rates on its personal savings and CDs, it is not enough to justify having a separate account with them, considering you would have to use another bank for your checking and personal loan needs.

Live Oak Bank banking products

These are some of the top banking products offered by Live Oak Bank. At the time of publishing, there is a promotion to earn $400 on Business Savings or $200 on Personal Savings.

Live Oak Bank small business checking account

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 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.

Live Oak Bank business savings account

The Live Oak Bank savings account offers higher rates without charging a monthly maintenance fee or requiring a minimum deposit, unlike similar business savings accounts with US Bank and Wells Fargo. 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.

Specific fees may apply 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.

Live Oak Bank CDs

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.

Other Live Oak Bank offerings

Live Oak Bank provides small business loans starting at $10,000. It offers loans from the 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 2.00%-4.30% (as of 10/29/24). Personal savings accounts have an APY of 4.30%.

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 Live Oak Bank compares to other banks

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 vs. Live Oak Bank

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 a 1.01% (as of 07/02/24) APY with an average daily balance of $5,000.

Customers interested in a business savings 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 vs. Live Oak Bank

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 a 2.25% (as of 06/27/24) APY on checking accounts. Unlike Live Oak Bank, Grasshopper offers unlimited transfers via ACH and wire.

Side-by-side comparison

	Live Oak Bank	Axos Bank	Grasshopper
Business Banking Options	Checking Savings CDs Business loans	Checking Savings CDs Money Market Business loans	Checking Business loans
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 CDs: $1,000	$100 for Business Checking
Interest Rate on Business CDs	2.00%-4.30% (as of 10/29/24)	0.10%-0.20% (as of 10/28/24)	None

FAQs

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.