"Free" is doing a lot of work in UK business banking marketing. Some accounts are genuinely free with no asterisks. Some are free for a 12–24 month introductory period then start charging. Some are free up to a transaction limit you'll cross within a year if your business grows. This guide separates them out so you can pick a free account that stays free.
TL;DR — the genuinely-free options
- Mettle — free forever, NatWest-backed, includes FreeAgent (worth £228/year). Best option if you'd otherwise pay for accounting software.
- Starling Business (sole trader only) — free forever for sole traders. Free Euro account add-on. Charges £7/month for limited companies.
- Tide Standard — free for sole traders and Ltds. EMI (not full bank), so no FSCS. Cash deposit fees apply.
- Monzo Business Lite — free for sole traders. Limits on certain features compared to £9/month Pro tier.
- Anna Money Pay-As-You-Go — free monthly fee but pay-per-transaction; works for very low volumes only.
"Free" with asterisks
The phrase to watch for is "free for 12 months" or "free up to X transactions". The most common patterns:
Introductory free periods
High-street banks (HSBC, Barclays, Lloyds, NatWest, Santander, RBS) commonly offer 12–24 months free business banking when you switch. After the introductory period, monthly fees typically jump to £5–£15/month. For freelancers who switch providers easily, this can be exploited indefinitely — switch every 18 months — but most people don't have the energy.
Transaction-volume tiers
Tide's free Standard tier covers most sole traders comfortably, but if you process unusually high volumes of incoming payments you may hit the included Faster Payments allowance. Above that, transactions cost ~20p each. Most freelancers never come close; high-volume retailers and aggregators might.
Cash and cheque fees
"Free" UK business accounts virtually all charge for cash deposits via Post Office (typically £1 flat plus a percentage). If your business handles cash regularly, this isn't a free account — it's a paid account with a per-deposit fee. For pure digital freelancers (services, design, tech, consulting), this doesn't apply.
Currency-conversion fees
Tide and Starling both charge a percentage markup on FX conversions when you receive overseas payments in non-GBP. This isn't a monthly fee but it accumulates. For overseas-heavy freelancers, a Wise Business account alongside (also free monthly) is usually better for currency conversion.
Card payment processing fees
If you take card payments via Tide Reader or similar, processing fees apply (1.5–2% per transaction). This is normal for card acceptance everywhere, but worth noting if you compare costs across providers.
Decision tree
If you're a sole trader and don't need accounting software
Starling Business is the cleanest pick. Free forever, full UK banking licence, FSCS-protected, best app, free Euro account. Almost no downsides for a freelancer who keeps their books in a spreadsheet or in our free expense tracker.
If you're a sole trader and need accounting software
Mettle wins easily. Free banking + free FreeAgent = saves you £228/year vs paying for FreeAgent separately. The combined product is materially cheaper than any alternative.
Worked example: A typical VAT-registered sole trader using FreeAgent + Starling pays £19/month → £228/year. The same setup with Mettle (which includes FreeAgent) pays £0. Over 5 years that's £1,140 difference.
If you're a limited company
The free options thin out fast. Tide Standard is free for Ltds; Starling charges £7/month. Mettle accepts single-director Ltds for free. Most freelancers find Mettle or Tide is sufficient at the Ltd stage if cost is the primary concern; if app polish + FSCS matters, Starling at £7/month is fair value.
If you take card payments in person
Tide with Tide Reader is the integrated option, though Square or SumUp as a separate provider also works alongside any of the free accounts.
If you handle overseas clients
Pair any free UK account with a free Wise Business multi-currency account. Wise handles the GBP/EUR/USD conversion at near-interbank rates with a transparent fee; your primary UK account does day-to-day banking. Most international freelancers run this stack. Full guidance: international payments for UK freelancers and Wise vs Instarem head-to-head.
Why the high-street banks aren't on this list
Barclays, HSBC, Lloyds, NatWest, Santander and RBS all offer "free business banking" but only for an introductory period — typically 12–24 months. After that the monthly fees kick in (£5–£15/month), and the app experiences are markedly worse than the challengers. For freelancers who value time and don't need branch access, the high-street offer is rarely worth it.
The narrow exceptions: businesses that need to deposit large amounts of cash regularly (in which case branch access matters), businesses with complex needs like trade finance, and businesses that genuinely prefer a "proper" bank for psychological reassurance. For the typical UK freelancer, none of this applies.
When to graduate from free
Most freelancers can stay on a free account indefinitely. The triggers for paying for a higher tier:
- You need multi-user access — bookkeeper or business partner needs login. Tide Plus, Monzo Business Pro, and Anna Plus all handle this.
- You want priority customer service — phone support, named account manager. Worth £10/month if you'd otherwise spend an hour on hold.
- You need higher transaction allowances — relevant for high-volume retail or aggregator businesses, not most service freelancers.
- You need cashback — Tide Cashback (£49.99/mo) refunds 0.5% on card spend up to £100/month, breaking even at £10k/month of card spend. Most freelancers don't hit that.
If none of these apply, free stays free — and the savings compound. £19/month for FreeAgent over 10 years is £2,280. £7/month for Starling Business over 10 years is £840. These are real numbers.
Yes — but check the regulation. Mettle and Starling and Monzo are full UK banks with FSCS protection up to £85,000. Tide and Anna are e-money institutions where funds are safeguarded but not FSCS-protected. For most freelancers with low balances, either is fine; for larger balances, the licensed banks are the safer choice.
Yes — either via the bank's own integration (Tide Reader, Anna Pay) or via a separate provider like Square, SumUp or Stripe linked to your bank. The bank account itself stays free; the card processing fees (1.5–2% per transaction) are a separate cost regardless of provider.
Both are e-money institutions (EMIs) rather than banks. Your funds are safeguarded in segregated client accounts at a partner bank, but not FSCS-protected. In practice, an EMI failure has never resulted in customers losing money — but the procedural protection is weaker than at Starling, Mettle or Monzo.
No, even though it's legally allowed for sole traders. Mixing personal and business cash flow makes bookkeeping much harder, makes tax-time confusing, and most banks' personal-account T&Cs technically prohibit business use. The cost of a free business account is zero; the cost of confusion is real.
Yes — the Current Account Switch Service (CASS) handles the mechanics. Some EMI-to-bank moves don't qualify for the formal CASS guarantee but can be done manually. See our switching guide for the playbook.
No — VAT registration is independent of bank account type. Open the free account first, register for VAT when you cross the threshold (or voluntarily if it makes sense), and configure your accounting software to track VAT from that date. See our VAT threshold guide.
Yes — Tide Standard and Mettle both accept single-director limited companies for free. For multi-director Ltds, options narrow: most cost £5–10/month. Starling Business (£7/month) is often the cleanest paid pick for Ltds.
Yes — many freelancers do. A common stack: Mettle (free + FreeAgent), Wise Business (free multi-currency for international clients), maybe Tide as a third for in-person card payments. The trade-off is reconciliation effort across multiple feeds; if you're not optimising aggressively, one free account is simpler.
General guidance on UK business banking as at May 2026. Pricing and tiers change — always check the live provider sites for current details. Not financial advice.