Grasshopper

Grasshopper Bank is the ultimate "hybrid" account for small business owners who want the best of both worlds: high-yield interest and cash back rewards. Unlike most banks that force you to choose between earning interest (like Bluevine) or transaction perks (like free wires), Grasshopper offers competitive APY, 1% cash back on debit spending, and free unlimited wires. It is one of the most comprehensive digital banking packages on the market, provided you maintain a $10,000+ balance to unlock the best perks.

At a Glance

• Account Type: Business Checking (Digital Bank)
• Monthly Fee: $0
• Minimum Opening Deposit: $0
• Transaction Fees: $0 for domestic wires, ACH, and check payments.
• APY (Interest): Yes (Earns competitive interest, often ~2.25% APY depending on current market rates)
• Rewards: Unlimited 1% Cash Back on debit card purchases (Requires average balance of $10k+ or $3k/mo spend)
• Key Feature: Free Outgoing Domestic Wires & Built-in Autobooks (Invoicing)
• Eligibility: Available to U.S. businesses, including Sole Proprietors.

Overview

Grasshopper Bank is a fully chartered digital bank based in NYC, built specifically for the innovation economy and small businesses. Because they are an actual bank (FDIC-insured directly, not through a partner "middleware" bank), they have more control over their lending and interest rates. They position themselves as the modern alternative to Silicon Valley Bank or Chase—offering the digital tools of a fintech with the regulatory stability of a bank.

Features & Benefits

• Innovator Business Checking: This is their flagship product. It is designed to be your primary operating account.
• Yield: The account pays a variable APY on balances. While not always as high as a dedicated savings account, it is significantly higher than the 0.01% paid by Chase or Wells Fargo.
• Unlimited 1% Cash Back: If you maintain a balance of $10,000+, you earn 1% back on all eligible signature-based debit card purchases. For a business spending $5,000/month on ads or supplies, that’s $600/year in free money.
• Autobooks: This feature lets you generate digital invoices and email them to clients. Clients can pay you via credit card or ACH, and the funds land directly in your Grasshopper account. It streamlines receivables massively.

Fees & Requirements

• Monthly Fee: $0.
• Wire Fees: $0 for Incoming/Outgoing Domestic. International wires generally incur fees (check current schedule, typically ~$25).
• Minimum Balance: $0 to keep the account open (though $10k recommended for perks).

Borrower Experience

• The Dashboard: The user interface is clean and professional. It feels more like "business software" than a "banking app," which is a compliment.
• Nautilus: For larger clients or fintechs, Grasshopper offers "Nautilus," a Banking-as-a-Service platform, though most small businesses will stick to the standard dashboard.

Who It’s Best For

• Established Small Businesses: If you consistently keep $10,000+ in your operating account, Grasshopper is arguably the most rewarding account available because you get both yield and cash back.
• Wire-Heavy Businesses: If you send 5 domestic wires a month (e.g., to vendors or for payroll), Grasshopper saves you ~$1,000 a year in wire fees compared to Chase.
• Freelancers needing Invoicing: The free Autobooks integration saves you the monthly subscription cost of standalone invoicing software.

Who Should Skip It

• Micro-Businesses: If your balance hovers around $500, you won't trigger the cash back or interest benefits. You might find Axos (with its $200 welcome bonus) more immediately rewarding.
• Global Importers: If you send wires to China or Europe weekly, Mercury is better because their international wires are free.
• Cash Businesses: No cash deposits means this account doesn't work for delis or barbershops.

Bottom Line

Grasshopper Business Checking is the "Goldilocks" account. It isn't as restrictive as Mercury (accepting Sole Props) and offers more perks than Axos (Interest + Cash Back). If your business has a healthy cash flow and keeps a buffer of at least $10,000, this account offers the highest total return on your money of any digital bank.