Grasshopper Business Checking Review

If you’re a small business owner looking for a checking account to manage your finances, one option to consider is the Innovator Business Checking Account from Grasshopper Bank. Grasshopper is an FDIC-insured online bank based in New York that launched in 2019. It focuses on providing services to small businesses, startups, and venture capital and private equity firms.

In this Grasshopper business checking review, we provide an overview of the account’s main features, to help you decide whether it’s a good fit for your business.

If your business needs to make frequent international payments, you can also learn about Wise Business as a solution in this article.

Grasshopper Business Checking Review: Quick Overview

Grasshopper Business Checking: Key Features

Grasshopper’s Innovator account is its checking account option for small businesses, while its Accelerator account is designed for startups and includes access to its investor network and partner marketplace.

The Innovator account has no monthly or overdraft fees and no transaction limits. It offers unlimited 1% cashback on purchases using its Visa debit card if the account maintains an average monthly balance of $10,000, which is a rare perk for a small business checking account. There is no minimum balance requirement for the account, although it does require a $100 initial opening deposit.

Unlike some business banking providers, Grasshopper pays interest on its checking account. At the time of writing, businesses can earn 2.25% annual percentage yield (APY) on balances of $25,000-250,000 and 1.51% APY on balances up to $25,000 or greater than $250,000.³

The Innovator account also offers free automated clearing house (ACH) payment transfers and incoming domestic wire transfers. Incoming international wires incur a transaction fee of $5 and outgoing international wires cost $25.

As Grasshopper is an online-only bank, there are no cash deposit facilities, although you can deposit checks instantly through its mobile app. Grasshopper offers fee-free cash withdrawals at 45,000 MoneyPass and SUM network ATMs.

Business owners can apply for a Grasshopper business checking account through the bank’s website in five minutes. However, you should be aware that businesses in certain industries will be blocked from holding an account:

• Adult entertainment
• Gambling
• Illegal substances
• Virtual currency
• Weapons and firearms

The Grasshopper Bank business checking requirements include providing personal and company registration information to open an account. Individuals who have direct or indirect ownership of 25% or more of the business must provide beneficial owner information. To fund the account, you will need to link an existing bank account and transfer the opening deposit of at least $100.

It’s worth noting that Grasshopper provides tailored support for startups that few other banks provide, including expert help on navigating investor opportunities, raising capital, applying to accelerator programs, and crafting pitch presentations. Grasshopper is a Small Business Administration (SBA) preferred lender and provides business loans for construction, acquisitions and debt consolidation.

Ease of Use

Grasshopper’s online and mobile banking platforms offer several convenient features to help small businesses streamline their money management.

Account holders can create and issue virtual debit cards instantly for online purchases and in-person contactless payments. Security controls set user permissions and can lock and unlock cards in seconds.

The Innovator account provides free integration with the Autobooks accounting and bookkeeping software. This allows businesses to create and send personalized invoices and accept payments by credit and debit card or ACH transfer for faster collection. Businesses can also connect QuickBooks or other accounting software to automate bookkeeping. And customers can access payment apps such as Venmo via a partnership with Plaid.

Grasshopper also offers an application programming interface (API) platform allowing business to integrate their banking data with their business data to manage their finances from their current operating system.

Customer Service

Grasshopper Bank’s customer support team is available by phone, email, text, or online chat Monday through Friday between 9am and 11pm ET. The website also features an online help center with various business banking guides. However, there is no live support available on weekends.⁶

Positive reviews on Trustpilot state that Grasshopper’s platform is easy to use and processes wire transfers seamlessly. Reviewers also praise the account’s lack of fees, including for foreign card transactions, as well as its cashback on purchases and interest payments on account balances.⁴

However, some negative reviews from Trustpilot mention that Grasshopper places five-day holds on deposits, and may close accounts without much advance notification. This can disrupt business operations, but it should be noted that it may be due to necessary security measures.⁵

Grasshopper Business Checking Wire Fees

• Outgoing domestic wires: $10
• Incoming international wires: $5
• Outgoing international wires: $25

Grasshopper Business Checking Pros and Cons

What are the Benefits of Grasshopper Bank?

The Grasshopper Business Checking account is an online-only option that offers small businesses and startups unlimited transactions, 1% cashback on purchases, interest on account balances and accounting software integrations, all without a monthly service fee.

Unlike many of its competitors, Grasshopper provides access to Autobooks for free, allowing businesses to create and send professional invoices and accept payments by card or ACH transfer.

Businesses that require financing can apply for SBA loans and receive tailored support from Grasshopper’s experts to improve their pitch decks and accelerator applications.

What are the Drawbacks of Grasshopper Bank?

As an online bank, Grasshopper has no physical branches and does not accept cash deposits. This may make it unsuitable for businesses that receive cash payments from customers or otherwise require in-person banking services. There are other digital-only banks that do allow customers to deposit cash through ATMs.

Although Grasshopper provides lending products, it does not provide other business banking services such as savings and money market accounts or certificates of deposit (CDs). Unlike some of its competitors, Grasshopper does not reimburse out-of-network ATM fees.

While Grasshopper provides extended customer support until 11pm ET on weekdays, it does not provide any support on weekends.

Grasshopper vs Lili Business Checking

Freelancers or gig workers may want to consider Grasshopper vs Lili Business Checking as a banking alternative.

Lili Bank is a digital banking and accounting service that provides FDIC-insured accounts through Choice Financial Group. Lili’s all-in-one account helps businesses make payments, send and receive invoices, streamline accounting and automate tax preparation.

Lili’s account comes with no hidden fees, no overdraft fees, and no minimum deposit or balance requirements. You can receive domestic wire transfers without fees or limits. Lili also provides a savings account that pays interest of 4.15% APY (at the time of writing) compared with Grasshopper’s 1.51-2.24% APY.

Lili’s smart bookkeeping features include instant transaction categorization and automated reports and insights. Its tax preparation features include automating tax savings throughout the year and automatically generating expense reports and pre-filled tax forms to streamline tax preparation. Its invoicing software allows you to create and send customizable invoices, accept payments instantly, track payments and send reminders.

However, it’s important to be aware that while a Lili account can receive incoming domestic wire transfers, it cannot receive or send international wire transfers. This makes it unsuitable for businesses that need to handle international transactions.

Conclusion: Is Grasshopper Business Checking the Best Choice for Your Business?

Grasshopper’s Innovator Business Checking account can be a solid choice for small businesses looking for an account without monthly fees or minimum balance requirements. Entrepreneurs can grow their funds with the account’s 1% cashback and interest payments on balances.

If your business is looking for outside investment to grow, Grasshopper is unique in providing account holders with expert advice on presentations and applications for financing.

However, Grasshopper may not be the right choice if your business needs to handle frequent incoming and outgoing international payments. Ultimately, the right choice of business checking account will depend on the specific requirements of your business. It’s important to shop around to compare account features and fees to find the best fit for your needs.

Discover Wise Business: The Low-Cost Solution for International Businesses

Businesses that regularly send and receive international payments may find Wise Business to be a suitable solution. A Wise account comes with no monthly fees, easy batch payments and integration with QuickBooks to track bill payments.

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. The Wise Business account is designed with international business in mind, and makes it easy to send, hold, and manage business funds in 40+ currencies. You can also get 9 major currency account details for a one-off fee to receive overseas payments like a local.

Learn more about Wise Business

✔️ Make international payments at the mid-market rate
✔️Open an account online and get set up with ease.
✔️ Manage multiple currencies all in one place
✔️ Make easy batch payments

All sources checked November 14, 2023.

About the author:
	Panna is an expert in business finance topics for the US, covering topics from invoicing to international expansion. She creates high-quality reviews on business finance tools and products with the aim to help businesses save time and make informed decisions. You can read more useful business articles on her author profile.