Brex vs Novo Checking Accounts

Trying to choose if Novo or Brex is the best business checking account for you? Both provide advantageous banking options for small companies and have seamless integration with payments and bookkeeping software. Which option should you select? To assist you in making the best decision, please review the comparison provided below.

Brex vs Novo: Summary comparison

The comparison table provides an overview of these two business banks.

	Brex	Novo
Type of offering	Business checking bank account	Business checking bank account
Country formed	United States	United States
Year formed	2017	2016
Pricing (from)	$0 per month	$0 per month
No. of clients	10,000	150,000
Bank card offered	Mastercard	Mastercard

Brex is a San Francisco-based fintech company that was established in 2017 and has been of assistance to companies who are looking for a $0 cash account. You may think of Brex as online banking in the cloud, and there are no limitations for minimum balances, starting balances, or monthly fees. Brex also does not need an initial balance.

Novo is a direct business lending firm that was established in 2008 and has its headquarters in Atlanta, Georgia. Their bank account is accessible in each of the fifty states that make up the United States. Novo, which is supported by Green Dot Bank, provides a highly appealing checking account that does not charge any monthly fees and makes it available to Novo Funding. Furthermore, American Express completed the acquisition of Novo in the year 2021.

Brex and Novo similarities

Both Brex and Novo are non-banking online business account platforms; neither company has actual branch facilities. They are enrolled with the FDIC, which means that the accounts of their clients are FDIC-insured to the fullest permitted limits. This is because their parent banks are registered with the FDIC.

Both of these financial institutions provide loan options to commercial enterprises, with Brex Venture Debt catering specifically to early-stage, venture-backed technology startups that have established a product market plan, recurrent revenue base, and scalable business plan. Candidates of interest are B2B software startups having yearly revenues of at least $500,000 or more.

You have the following with Brex and Novo:

• A bank account for a company that is accessible online
• There are no minimum balance fees, overdraft fees, or monthly fees associated with this account.
• Banking card
• Smartphone application
• Lending

When it comes to the services they provide, both Brex and Novo are compatible with popular accounting programs like Quickbooks, so users can quickly synchronize their financial information (such as bills, transactions, and payees) between the two. Both financial institutions do not need a starting deposit, do not charge transaction limit fees, and do not charge ACH costs.

Members of Brex, on the other hand, are unable to use their Brex card at an ATM for cash withdrawals or deposits, but Novo customers enjoy free access to over 19,000 ATMs that are part of the Novo network.

Note: It is neither difficult or time-consuming to sign up as a client with any of these two service providers. Opening a bank account for your internet company may be done in a matter of minutes.

Their user interfaces are either online and accessible through the web, or accessible via their mobile apps, both of which are straightforward and simple to use on a regular basis. Both Brex and Novo are geared for professionals, small and medium-sized businesses, single proprietors, and those who are self-employed who are searching for a banking solution that is both straightforward and cost-effective.

Brex and Novo differences

Now that we’ve established that, let’s compare Novo and Brex to see how they vary. The comparisons between the two are broken down into their respective categories in the table that follows.

	Brex	Novo
Annual Percentage Yields	Cash that is not invested produces no return. Investing cash in money-market funds results in a yield of 2.81 percent after 7 days.	N/a
Cash Machine Fees	You are unable to use your Brex card at an ATM to withdraw cash or make deposits of any kind.	There are no fees assessed when using an ATM that is not part of your network. Novo will pay the fees assessed by ATMs located all over the globe.
Checks	Using the Brex app is the only way to process virtual check deposits. We do not accept physical cheques sent in the mail.	You are unable to write regular checks. The mobile app gives users the ability to have checks sent over to them.
Electronic Funds Transfer Fees	Domestic wires sent outbound cost $25, while prices for receiving wires vary widely depending on the supplier.	Novo accounts are able to receive domestic as well as international wires, however customers cannot use their Novo account to transmit domestic wires.
Promotion	SEE THE OFFER	SEE THE OFFER

There are a lot of key distinctions between these 2 bank accounts that you should take into consideration when making your decision between the two of them.

While Brex does not provide a yield on uninvested cash, it does offer a return of 2.81% seven-day rate on cash that is invested in money market funds. Novo does not offer any interest bearing accounts that pay APY, and Brex does not offer a yield on uninvested cash either. In contrast to Novo, which does not let its customers to initiate domestic wire transfers, Brex charges a flat cost of $25 for each domestic wire that is sent out and assesses additional fees for each domestic wire that is received.

Through the Novo app, users are able to make ACH transactions, which do not incur any fees and are an alternative to domestic wire transfers. Let’s look more closely at the specifics of the Brex and Novo offerings now that we have a better understanding of the ways in which the two banks are similar to one another and the ways in which they vary from one another.

Comparing Brex with Novo in Terms of Pricing, Plans, and Services

Fees

There are some distinctions in the overall price, the programs, and the service provided by the two banks, even though both cater to proprietors of small businesses and independent contractors. The following is some data on the deals that are being offered by Brex and Novo.

	Brex	Novo
Free offering	Yes	Yes
Charges incurred every month	$0	$0
Transaction fees	$0	$0
Number of accounts	Up to seven accounts total	1 account
Cash Deposited	Not supported	Not provided
Transactions on a monthly basis	Limitless	Free of charge unlimited transactions, free of charge ACH transfers, and free of charge inbound wire transfers
Line of credit	Up to thirty percent of your current Brex Cash balance	None

Both Brex and Novo are quite competitive with regard to their monthly rates, since they do not charge any fees for the initial setup or ongoing maintenance and allow for an unlimited number of daily transactions. Only the processing of virtual check deposits inside the Brex app is available with Brex. Physical checks sent in the mail are unable to be accepted, however users of Novo may utilize the mobile app to deposit checks into their accounts.

Neither of these banks has a facility for depositing cash. Both financial institutions, however, do not charge customers any monthly fees or transaction fees.

Other services

	Brex	Novo
Funding	Yes	No
Overdraft	Yes	Yes
Accounting	No	No

Both Brex and Novo are excellent options for small companies looking for bank accounts since they provide credit to commercial clients.

Each withdrawal from your business line of credit with Novo Funding will be a new 6-, 12-, or 18-month installment loan, depending on your qualifications and the amount borrowed. You are permitted to take out a term loan with a minimum amount of $500 for a period of six months, $10,000 for a period of twelve months, and $20,000 for a period of eighteen months.

Brex Venture Debt is developed for early-stage, VC-backed technology companies and makes use of money that is less dilutive in order to maintain greater ownership while driving the company’s development.

Collection and payment options provided by Novo and Brex

Payment methods

The following is a table that contrasts the various payment options provided by Novo and Brex.

	Brex	Novo
Card type	Mastercard	Mastercard
Checks	Yes	Yes, by using the mobile application
The use of wire transfers	Yes	Can’t send domestic wires via the Novo account
Foreign wires	Yes	Wise allows you to send money to anybody in the world.
ACH transfers	Yes	Yes

Means of collection

The following is a list of the several ways of payment that may be used with these 2 accounts.

	Brex	Novo
Checks	Yes, the Brex app’s virtual check deposits are the only ones that can be processed. We are unable to process physical cheques sent in the mail.	Yes
Wire transfers	Yes	Yes
ACH wires	Yes	Yes
Foreign transfers	Yes	Yes

While users of Brex are able to make international wire transfers and begin such transfers, Novo customers may also make international transactions but must pay a charge equal to three percent of the entire value of the transaction.

How do I decide between Brex and Novo?

Both Brex and Novo provide their customers with enticing and distinctive online business account options. So how exactly should you go about making your decision? When deciding which option to go with, these are some of the most important considerations to bear in mind:

• Services: Depending on the requirements of your company, there may be some corporate checking accounts that are more appropriate than others. Novo differentiates out from other solutions since it does not charge recurring fees, integrates with Quickbooks and other programs of a similar kind, offers a virtual card, and enables users to send an infinite number of customised invoices. However, Brex’s transition away from smaller firms in June 2022 may not be the ideal choice for all entrepreneurs, despite the fact that the company provides upfront and transparent pricing as well as limitless transactions.
• Credit line: Brex provides an innovative proposal including its Venture Debt product for VC-backed technology companies, while Novo collaborates with other institutions and organizations to assist in the provision of loans for businesses. Brex’s product is geared toward IT companies.
• Are you going to be engaging in any international transactions at all, or perhaps a significant number of them? If this is the case, you should be informed that Brex does not charge any extra costs for international wire transfers. Customers of Novo, on the other hand, are unable to send foreign wires directly; however, there is a workaround available in the form of a connection with Wise.
• Other: In addition to the aforementioned disadvantages, Brex clients are unable to use their cards to withdraw cash from ATMs, while Novo members enjoy the use of over 19,000 ATMs that are part of the same network as Novo.

For further information:

• See our detailed Brex review
• Read on for our detailed Novo review here

There are numerous additional business accounts that may be opened, and some of them are definitely worth investigating. Small and medium-sized businesses (SMBs) may choose to investigate Bluevine, Relay, or even Chase, the biggest bank in the United States.

Bank of America might be the right choice for customers seeking for a financial institution with a big number of branch locations, whilst Capital One provides a comprehensive range of financial goods and services to companies of all sizes.

Please feel free to have a look at our comparison of business bank accounts to learn more about the many banking options available to companies.

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