Can I Use a Personal Bank Account for Business in Singapore?

In Singapore, Sole Proprietors, Partnerships and Limited Partnership businesses can operate from personal bank accounts. However, if you’re registering a Company or Limited Liability Partnership (LLP), you must open a business bank account¹.

While it is permissible for sole proprietors and small businesses to use a personal bank account for business in Singapore, the real question is, is it truly beneficial to do so??

In this article, we’ll explore this question in detail and provide some tips on when you should consider switching to a business bank account. We’ll also explore Wise Business as a cost-effective business account for managing international payments.

Table of contents
Drawbacks of using your personal bank account for doing business in Singapore Benefits of using a separate business account in Singapore When should you switch from a personal to business bank account? What to look out for when opening a bank account for business

Drawbacks of using your personal bank account for doing business in Singapore

Lack of Credibility

If you’re running a small business that serves retail customers, your clients may be comfortable making payments to your personal bank account or PayNow number.

However, if you wish to pitch for contracts with corporations or even higher-value contracts, you may need a business bank account to be taken seriously. Some corporations may have internal finance policies that only allow contracts to be awarded to ACRA-registered vendors with business bank accounts.

In addition, if you’re serving clients in the Singapore government sector, you may need to apply for a Vendor@Gov account. If you’re registered as a Company or Organisation, you’ll need to provide a corporate bank account registered under your business name and ID to collect payments from organisations that use the service².

Bottom line: You may be discounting the credibility of your business and limiting your growth by using a personal bank account in such cases.

Security

As a business, you’ll be sharing your bank account details with your clients and suppliers. You may even need to link your account to third-party payment software. A security breach could result in the loss of both your personal and business funds. SDIC insurance does not cover such security breaches.

TLDR: Having a separate business bank account allows you to segregate your personal funds from your business funds.

Messy Accounting and Tax Reporting

Using a personal bank account for business would inevitably lead to the mixing of personal and business transactions. While it can be easy to manage new businesses or side hustles with low business transactions, the process can get messy as you grow.

You may also need to manually separate personal and business transactions during tax filing which is both time-consuming and inefficient.

Potential Compliance Issues

Should your business be audited, the mixing of personal and business transactions may lead to complications in compliance.

While new businesses need not worry about this, you should start considering the need for a separate business account once your business starts bringing in significant revenue.

No access to features designed for businesses

Business bank accounts offer features such as:

• Ability to integrate with accounting software,
• Payroll features,
• Access to corporate debit or credit cards and even
• Access to business loans.

💡Did you know that Wise offers both personal and business accounts? ➡️ Read our complete guide to Wise Personal vs Business accounts here. ⬅️

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Benefits of using a separate business account in Singapore

Although it may be time-consuming to open a business bank account, many banks and fintech companies allow businesses to open an account fairly quickly with the integration of MyInfo.

Here are three benefits of using a separate business account for your business in Singapore:

Credibility

Having a business bank account with your business name lends credibility to your business, especially to corporate clients. It also signals that you are in it for the long run and not a fly-by-night side hustler who may not remain in the business for long.

Clear separation of business transactions

Having a separate business account allows you to track all your business transactions and have a clear idea of how your business is performing.

It also allows you to file for taxes efficiently, without having to manually decide whether a transaction is personal or business-related.

If your business serves clients internationally, Wise Business offers a multi-currency account with low fees and mid-market exchange rates that help keep your expenses low while allowing you hold and convert between 40+ currencies for international payments. At the end of each month or accounting cycle, you can easily generate a list of all transactions for easy accounting.

Access to Business Account features

Features like payroll services, invoicing tools, integration with accounting software, and access to bank loans may be useful when your business starts scaling.

In the case of Novelship - a Singapore-based online marketplace for sneakers, apparel and collectibles - they discovered an innovative feature in Wise Business account the Batch Payments tool, which lets them initiate up to 1,000 transfers with a single upload. This is just one of many ways how they use Wise Business to make paying invoices and international suppliers easier, cheaper and more efficient.

➡️ Read how Novelship saved time and money while expanding globally ⬅️

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When should you switch from a personal to business bank account?

While it is easier and faster to kickstart your business operation as a new business using a personal account, there comes a point where your business will outgrow a personal bank account.

You should consider switching to a business bank account when:

• You require features of a business bank account such as integration with accounting software, payroll tools, corporate credit/debit cards, or loan or cash advances.
• You want to grow your business’ corporate clientele and need a credible payment system.
• Your business transaction volume grows and having a separate account makes it easier to track incoming and outgoing transactions,
• Tracking of income and expenses becomes too messy, or if you are starting to outsource your accounting and require clear records for your accountant.
• Your business starts bringing in a regular monthly income.

What to look out for when opening a bank account for business

Ease of setup

You may be thinking of using your personal bank account because you do not want to waste time waiting in line at a bank branch or dealing with the paperwork of opening a business account.

Good news: Most banks and fintech companies allow you to open a business account online, from the comfort of your home or office. All you need is internet access as well as your business details on hand.

🏦 If you are not sure which bank account is best for Singapore businesses, check out our complete review here. 🔍 Not sure how to open a business account? Read our guide to opening corporate bank accounts in Singapore here.

Fees

Another reason that may be holding you back from opening a business bank account is the fees. Business bank accounts may come with fall-under fees, monthly account fees, and transaction fees.

With the entry of digital banks and fintechs, fees have dropped significantly, and there are a plethora of options available for SMEs and small businesses and enterprises in Singapore.

• For example, Wise Business only charges a one-time set-up fee with no monthly account fees or fall-under fees³.
• If you’re a sole proprietor looking to earn interest on your business funds, the GXS Biz Accountmight be of interest to you.

Business debit cards

As your team grows, you may need a solution that offers your staff the flexibility to spend while managing their limits and constraints. Business bank accounts offer the option to apply for debit cards based on your spending needs. Debit cards tend to offer:

• Lower fees compared to credit cards: there are no annual fees or interest charges
• Easier budgeting: you can set spending limits
• Easier expense tracking: all transactions are reflected within your account, many of which are automatically categorised for ease of accounting.

💡 Pro tip: Track your team's expenses by giving them their own Wise Business cards connected to your Wise Business account. This way, they don't need to use their personal account for business expenses — and you can monitor their spending, filter transactions by team members, download statements, and manage company spending limits all in one place.

Additional business banking features

Depending on your business needs, you may find the following features useful:

• Payroll services: if your business manages a large team, having a payroll service could help save time
• Integration with accounting software: this makes the process of compiling transactions more efficient.
• Others: With a Wise Business account, you can even create and send invoices directly from your account. Clients can pay directly via the invoice and the payment transaction is automatically recorded in your account.

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Conclusion

In summary, you can use a personal bank account for your business in Singapore as a sole proprietor, partnership or limited partnership. That being said, most businesses here fall into the Company or LLP category. For these businesses, a business account dedicated solely for their business transactions is a must-have.

It is highly recommended to have a business bank account as it allows you to keep your business transactions separate from personal transactions. This helps to keep your business’s cash flow clear and also makes it easier to compile your finances when filing for income tax returns.

If you’re looking for a low-cost option for your first business account, consider Wise Business.

On top of low conversion fees, Wise Business doesn’t charge any fall-under fee, which is critical for a new business as you may not have the luxury of having funds sitting around in your account. If you intend to expand globally, Wise Business is a smart business account that will stand you in good stead.

• Hold and manage 40+ currencies for all your international transactions
• Pay suppliers and receive payments internationally without the hefty foreign transaction fees
• Always get the mid-market rate with zero markup
• Seamless integrations with popular accounting software
• Say goodbye to monthly fees

➡️ Get Started with Wise Business today

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Sources

1. Four financial tips to know before starting a business | GoBusiness
2. Vendor Record User Guide | Vendors@Gov
3. Wise Business Pricing

Sources checked on 17 March 2025