As a small business owner one of the first things you need to sort out is a bank account. With Tide this couldn’t be easier. You can have an account up and running in under 5 minutes. But accounts such as this aren’t for everyone. Let’s have a look at some of the pros and cons of a Tide account. Who is it for and who isn’t it for? Is Tide even a bank account?
In a nutshell
I’ve used Tide for several businesses and it’s worked really well. It’s ultra-fast, free and very simple to use. If you don’t need a high street branch then it could be the perfect neobank account for you. Want to know more? Read on below.
Can’t wait to get started? Tide are offering Small Business Toolbox readers a special introductory offer of 12 months of free transfers AND £40 cashback! (until 30th June 2021).*
Simply sign up using this link or use the code BUSINESSTOOLBOX. This article contains affiliate links – these help to cover the costs of running this free website. Please read the full terms & conditions at the bottom of this article.
Is Tide really free?
At the time of writing there are three business accounts to choose from:
- FREE account: The account itself is free, you just pay 20p for transfers (free for a year if you use this link). No phone support on this account.
- PLUS account: £9.99+VAT per month, 20 free transfers per month, phone support included.
- CASHBACK account: £49.99+VAT per month, 150 free transfers per month, phone support included, 0.5% cashback.
There’s a bit more to it than that so double check the Tide website for more information. For most businesses the free account is probably more than enough to get you started. It’s worth noting that if you spend more than £10,000 per month on stock etc. then the Cashback account may pay for itself.
What is Tide?
Tide is a privately owned financial technology company founded in 2015. Tide themselves technically aren’t a bank but what you end up with looks and feels like a normal business bank account, only without the branches. According to their website “Tide also offers bank accounts provided by ClearBank (ClearBank® Ltd. is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 754568).”
You get a sort code and account number and you can have direct debits, standing orders and all the usual stuff. However there are a few other key differences that set it apart from the traditional high street banks.
From what I’ve seen so far they’re a forward-thinking company and a welcome addition to the small business scene. Just make sure they’re suited to your business before opening an account. In this article I want to dig a bit deeper in to what a Tide account actually is.
What is a Tide business account?
Before we start, a very quick summary of what Tide is. Tide is an account designed for modern, tech-savvy businesses. One of their core aims is to take the admin burden off the shoulders of sole traders and micro-business owners.
The really nice thing about the account, especially when you’re just starting out, is that if you’re not making any money the account doesn’t cost you a penny. When you do start making some pennies there’s just a small 20p charge for each transfer in or out of the account. Card payments are free and as an added bonus Tide are kindly waiving the 20p charges for the first year if you use this link to sign-up.
I’ve read the odd report saying that Tide isn’t a ‘proper’ business bank account – that is and isn’t true. I’ve used Tide for several businesses and to me it looked and felt like a normal bank account, so I guess it all depends on your definition of a bank account. Tide gives most of the normal stuff big banks offer and a few extras that are very nice to have.
One slightly confusing factor is that when Tide first started out they provided e-money accounts provided by Prepay Technologies Ltd. They now offer accounts provided by ClearBank with full FSCS protection (so fully FCA and PRA regulated). They’re also offering existing customers the opportunity to switch from their e-money accounts to their ClearBank accounts, which is great news!
It’s not all a bed of roses though – there are a few limitations that could be problematic depending on how your business operates. The fee structure is up-front and simple though – I really appreciate this. I’ve seen some business accounts where the fee structure is explained in 8 point font over the course of a 10 page PDF. Not with Tide:
Who is Tide for?
From a UK perspective, Tide operates like any normal account so should be absolutely fine for the vast majority of small businesses.
- You can set up direct debits
- You can set up standing orders (known, more sensibly, as scheduled payments)
- You get on-line bank statements
- You’re provided with a Business MasterCard debit(ish) card and can have up to 35 ‘team cards’ for staff members etc.
- You can pay-in cash at the Post Office (£1 charge)
- You can withdraw cash at ATMs (£1 charge)
Contrary to popular belief, it’s great for cash-based businesses, businesses who accept payments on-line and anyone who accepts payments via a payment provider such as PayPal, Stripe, GoCardless and iZettle. As such it’s ideal for:
- Sole traders
- Self employed
- Small companies
- Small shops
- Independent traders
- Trades people (plumbers, electricians, builders etc.)
Real benefits of Tide
What sets Tide apart from the pack, in my view, is ease of account set-up and management. I’ve never known a bank account that’s so easy to open. Ever! In under 5 minutes I was up and running with an account number and sort code. If you don’t believe me watch this:
By way of a comparison, I recently opened a business account with Barclays. I applied online and provided all of the ID they asked for electronically as requested. It was 3 weeks before I received an account number and sort code. With Tide it was almost instant.
The real joys of account management then come in to play once you start making full use off their mobile app. and the associated web interface.
Tide have really put a lot of effort in to making account management as simple as possible. Everything is a real pleasure to use. It’s fast too! Access to the web interface is controlled by scanning a QR code on the screen from your phone. Access is then granted instantly and I MEAN instantly. Even the application process for limited companies is fast. They even offer a service where they’ll set up the limited company for you for free!
Logon to the app itself is instant via fingerprint recognition. You also have a passcode as backup. Face recognition technology is also used for certain tasks, but generally your fingerprint will be sufficient for most stuff.
- iOS and Android compatible
- Account management via app. or web
- Accounting integration
- CSV exports
- Read-only account access e.g. for accountants
- Multiple Accounts (coming soon!)
There’s some really nifty features such as transaction categories and the ability to upload pictures of your receipts to associate with each transaction:
Above all, IT’S SO FAST!! It’s very rare that I would describe management of a bank account as being ‘pleasurable’ but Tide have really ticked all the boxes here. Everything within the app. and via the web is a joy to use. Hats off to everyone involved in designing this – nice work. Very nice work.
How ‘fast’ are Faster Payments?
Faster payments seemed to be slightly slower than with other banks. I carried out a test transfer IN to my new Tide account from NatWest and it took about an hour to come through. A similar transfer from NatWest -> Halifax was instant. I tried another NatWest -> Tide transfer on the off-chance it was just due to it being a new payee and it still look 56 minutes. Not a problem, just slightly slower than normal. I must confess I haven’t tried this since they switched to using ClearBank so this might have changed.
I also tried a test transfer OUT from Tide -> NatWest and that was much faster, at around 10 minutes. Halifax -> NatWest was instant though.
Apparently Faster Payments are processed every 30 minutes and cleared within 2 hours, so that would be close-ish to the above timings. Just for information, BACS payments ‘officially’ take 3 working days and CHAPS are same working day. It’s all Faster Payments with Tide though and the above timings shouldn’t be a problem for most people. Obviously as larger sums are involved additional security checks may be implemented. That might slow things down a bit, but I’d rather they kept security as their top concern versus receiving a transfer a few minutes sooner.
Is the Tide card a credit or debit card?
So you’re provided with a ‘Business MasterCard’ when you open your account – this is actually a ‘prepaid card’ and is marked ‘Commercial Preferred Prepaid’. The card is issued by PrePay Technologies Ltd (“PPS”) under a license from Mastercard International. Apparently PPS is authorised by the FCA for the issuance of e-money. It seems to function like a normal debit card, drawing on existing funds from your account. So it’s not really a credit card and it’s not really a debit card.
For the vast majority of situations this should be fine, however it could cause some complications. A prime example is HMRC who still charge a fee for business credit cards (cheeky!) but paying your tax using a business debit card is free. There have been some reports of the card not being accepted with certain providers and it’s probably down to the vague nature of what it actually is. Apparently Tide are working on releasing a normal debit card so watch this space! I haven’t had any problems with it so far though.
What about limited companies?
It’s just as easy and quick to open a Tide account for a limited company. My test account was up and running in under 10 minutes. You can see exactly what was involved in this video:
Who is Tide NOT for?
Tide are really shaking up modern business banking but it’s not for everyone. Here are a few of the main differences:
- No cheques
- No international transfers
- No IBAN or BIC / SWIFT code
- No overdrafts BUT see below
The biggest change is no more cheques. Now I haven’t written or received a cheque for many years but I know some businesses still rely on this. If you’re still in a sector where you get presented with cheques on a regular basis then this probably isn’t the account for you. Likewise, you don’t get a cheque book so you can’t write cheques. Why cheques still exist is beyond me.
Also, at the moment there are no international transfers. You don’t get an IBAN so accepting payments from foreign sources could be tricky. Apparently you can get around this using providers such as TransferWise but for me this didn’t work with Payoneer. If this means nothing to you then you can probably skip this bit.
Apparently some Tide members with limited companies can have a Tide International Currency Account but when I applied for one of these in June 2020 I was told this service is temporarily ‘paused’.
They also don’t offer overdrafts, however they’ve partnered up with Iwoca for business loans, which is essentially what an overdraft is. So you can potentially get up to £150,000 of credit straight through the app.
What about Tide for content creators? E.g. YouTubers?
This is where things get a little more complicated. There must be tens of thousands of content creators in the UK who need a bank account to manage their income as influencers and whatnot. At first glance Tide would be the PERFECT account for the tech savvy folk who are receiving money through a variety of income streams.
One of the biggest frustrations with Tide, and it’s not really their fault, is that the account would appear to be incompatible with a number of international online payment providers. For the content creator market (such as myself) this could be problematic.
Payoneer immediately rejected my e-money account a valid destination account. This is potentially a big problem for any affiliate schemes that pay out via Payoneer, such as Patreon and Teespring. Also, Amazon Affiliates requires an IBAN and BIC code, so that straight away rules out Tide. Having said that, you may find now that Tide are using ClearBank some of these things work.
Here’s a quick run-down of my experience for all the fellow YouTubers out there:
Using Tide as a destination account to accept PayPal payments appears to work fine. Fast – no issues.
Fine for receiving credit card payments via iZettle. Less fine for receiving affiliate payments as this requires an IBAN & BIC – this should impact very few people though.
I’ve yet to try accepting normal payments via Ebay to Tide but have been assured these work fine. Payments via the Ebay Partner Network (affiliates) work fine too.
I added my Tide account to a Stripe payment gateway and it worked fine without any problems.
Apparently fine but I haven’t tested it.
YouTube / Google AdSense: FINE
Payments from Google Ireland for AdSense revenue worked fine.
When I tried to link my Payoneer account to Tide I received an e-mail from Payoneer saying they don’t support the account that was added. I escalated this within Payoneer but they didn’t bother getting back to me. So Payoneer is a non-starter with Tide. Tide suggested I try using TransferWise, which I did. A somewhat convoluted way of getting money out of Patreon (Patreon to Payoneer, Payoneer to TransferWise, TransferWise to Tide) but once again ‘computer said no’. The TransferWise account was also rejected by Payoneer (so not Tide’s fault!). Payoneer would appear to only work with traditional bank accounts so that’s annoying. You can of course pay out from Patreon and Teespring via PayPal but Payoneer would seem to be more fee-efficient. It’s also worth noting that this may now work with Tide’s ClearBank accounts. Please let me know!
Teespring pay out via Payoneer or PayPal. So Payoneer isn’t an option but PayPal should be fine.
Similar to Teespring, Patreon pay out via PayPal or Payoneer. If you have a Tide account you’ll need to route the funds via PayPal.
Amazon Affiliates: NOPE
I don’t know how many Amazon Affiliates there are in the UK but I bet there’s a lot. At the time of writing you need an IBAN / BIC code to receive money from Amazon and that just ain’t an option with Tide at the moment.
So, if you’re a content creator all is not lost BUT you might have to do some creative account management to get around the above limitations. Amazon is probably the biggest hurdle but there will be other affiliate and influencer schemes that rely on IBANs and BICs. Let’s see how this one progresses as I imagine Tide don’t want to miss out on this potentially huge market!
Tide don’t seem to publish their default account limits any more but on an account I recently set up for a limited company (June 2020) the limits were as follows:
- Maximum account balance: £1,000,000
- Monthly limit: £250,000
- Single outbound transaction limit: £50,000
- Card transactions: £50,000 monthly limit & £10,000 daily limit per account
- ATM limits: £500 cash per day max
You can also raise a request to increase the limits via the app. so no problems there.
Is my money safe?
In short, I think so! In January 2019 Tide joined forces with ClearBank and this is what it now says on the Tide website:
“Tide Platform Limited designs and operates the Tide website and app. Tide is not a bank, the Tide current account is an e-money account provided by Prepay Solutions (PPS), a trading name of Prepay Technologies Ltd which is an electronic money institution authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011 (FRN 900010) for the issuing of electronic money. PPS holds an amount equivalent to the money in Tide current accounts in a safeguarding account which gives customers protection against PPS’ insolvency.
Tide also offers bank accounts provided by ClearBank (ClearBank® Ltd. is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 754568). Eligible deposits with ClearBank are protected up to a total of £85,000 by the Financial Services Compensation Scheme (FSCS), the UK’s deposit guarantee scheme. For further information visit fscs.org.uk.
The Tide card is also issued by PPS pursuant to license by Mastercard International. This card is for payments from Tide accounts.”
So it certainly looks like accounts are provided with full PRA and FCA regulation and FSCS protection of up to £85,000. Would I leave my life savings resting in the account? Probably not. Would I be comfortable leaving a normal amount of working capital in the account? Yes, but that’s a risk that’s entirely up to you.
Of course remember that if you’re still using one of Tide’s older e-money accounts then the ClearBank safeguards wouldn’t apply. So I would really consider asking Tide to switch your account over.
What about customer support?
If you want phone support you’ll need to stump up for either their Plus or Cashback accounts. The free account only includes web support. Having said that, their in-app support has been excellent for me. I’ve always received a response well within 24 hours and their staff have been friendly and helpful.
To put things in perspective I also have an account with Barclays and I recently tried calling them about an urgent matter. I spent more than an hour on hold on two separate occasions and nobody picked up, so I gave up. I then tried to send them a secure message via my online banking (several times) and it just didn’t work at all. I literally had NO WAY of getting in touch with Barclays about my account. Not impressed!
The moral of this story, just because high street banks have phone lines doesn’t mean you can actually use them. Tide on the other hand have always been a pleasure to deal with.
So should I get a Tide business account?
It’s worth opening an account just to experience the joys of what 21st century banking should look like! In a nutshell it’s all down to whether the limitations outweigh the benefits for your business. For most small businesses who deal solely within the UK a Tide account will be a very tempting alternative to the big names.
I’ve been blown away by the account set-up time and ease of use. The account is a genuine pleasure to use. It’s free to set up an account so give it a try and see if it works for your business.
Remember if you want to take advantage of Tide’s offer of 12 months free transfers, just click on the link above or click here.
Tide offer terms:
Valid for new accounts only. Valid for account applications completed between 04/03/2021 and 30/06/2021 (inclusive) only. To be eligible to receive the Offer, applicants must first successfully open a sole trader or limited company business current account with Tide. Account opening eligibility criteria and customary know your customer checks apply. To activate the Offer, the applicant must use the referral (partner) code: BUSINESSTOOLBOX. The applicant is required to either enter the referral code while signing up via the partner landing page, on https://web.tide.co/sign-up, or through the mobile app. The Offer is limited to one £40 cashback reward per applicant. The reward will be paid into the applicant’s new Tide account. It can take up to 8 weeks from the date the applicant successfully opens their account for the reward to be validated and paid. We reserve the right to modify these terms and conditions or withdraw this Offer at any time. This Offer cannot be used in conjunction with any other Tide offer or promotion. 12 month free banking offer is by no means guaranteed. Please verify the offer is still valid when signing up.
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Originally published: 27th May 2019
Last updated: 7th March 2021
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