Hatch is a digital bank that’s modernizing the small business banking industry.
With a robust online platform, low fees, and up to 5% cash rewards, Hatch is a fresh option for emerging entrepreneurs.
In this post, you’ll learn everything there is to know about this growing fintech company.
Hatch: Meet the man behind the FinTech
Our mission at BankBonus is to help you find the best bank for your needs, and we think meeting the people behind the tech can help. Listen to the interview now!
Interview with Thomson Nguyen
In this episode, Grant Sabatier chats with Thomson Nguyen, the Founder and CEO of Hatch Business Banking.
Hear why Thomson founded the business bank, the security and backing behind the FinTech, their philosophy on fees (and their relationship with business owners in general), along with insight into the platform’s features and future direction.
Let’s review Hatch’s most popular features, with a particular focus on its small business solutions.
All Hatch accounts come with the Hatch Debit Mastercard that pays up to 5% cashback.
Here is the breakdown of how much cashback you can earn for each spending category:
- 5% on car rentals
- 4% on dining
- 4% on hotels
- 3% on business vendors
- 1% at participating gas stations
All you have to do is use your card at its network of participating retailers (e.g., hotels, car rental companies, and gas stations) and the cashback will automatically post to your account.
No NSF Fees
Hatch Cover provides up to $50 on all eligible transactions if you overdraft your account.
Typically, banks charge over $30 for overdrafts, non-sufficient fund (NSF) fees. You won’t find that with Hatch, assuming your balance was less than $50 in the red.
Free ATM Withdrawals
Hatch Business Checking comes with five free ATM withdrawals per monthly statement, through its network of 55,000 Allpoint ATMs.
After the fifth Allpoint withdrawal, the fee is just $1.00. If you use an out-of-network ATM, you’ll have to pay whatever fee the operator charges.
Easy Money Transfers
Hatch customers can easily send money through the Hatch Dashboard. Transfer options include ACH, bill pay, or paper check.
Note: The first five checks are free, and there is a $1 fee thereafter (similar to ATM usage).
MasterCard Enhanced Debit Benefits
The Hatch Debit Mastercard comes with some neat perks and discounts. Here are a few that stand out:
- Extended Warranty Coverage for your electronics purchases
- Discounted access to Mastercard’s Global Airport Concierges services
- Car Rental Insurance
Typically, business owners would have to use a business credit card to get these types of benefits.
Hatch states its pricing clearly. The Hatch Business Checking account costs $10 a month, and there’s no way around it. The good news is that it’s hard to find fees other than this relatively low one.
By comparison, Bank of America’s monthly business checking account fees ranges from $16 to $29.95.
As a Hatch customer, you’ll get access to a variety of exclusive deals on many common business tools. To find deals, visit the Perks section of your dashboard.
Next, let’s take a look at the main financial products that Hatch offers.
Hatch Business Checking
Hatch Business Checking is the company’s sole bank account option. There is a $10 monthly fee, and customers get access to a variety of perks and benefits, as follows:
- Hatch Business Debit Card, which comes with MasterCard Enhanced Benefits
- Up to 5% cashback rewards on qualifying purchases
- No NSF fees if you overdraft your account by less than $50
- Easy money transfers through ACH, bill pay, or paper check
- First five in-network ATM withdrawals are free
- No minimum balance requirement to open an account
Hatch Business Line of Credit
To qualify, you must be invited by Hatch. There is no credit check or hard pull from the major credit bureaus. Most likely, if your account is in good standing, and you demonstrate a reliable payment history, you will get the chance to sign up.
Once approved, you can use your Hatch Business credit card to make everyday purchases.
There aren’t any details about the credit limits you can, because that depends on your unique situation. Just be sure to pay off your balances in full each month, otherwise, you’ll be looking at an interest rate that ranges from 18% to 24% APR.
For example, Sprout can help with incorporation, registering your EIN, and paying registered agent fees.
LegalZoom is a leading provider of business formation services if you are looking to form your business right away.
Hatch is very transparent about its pricing, and there are no hidden fees that you might find at bigger banks.
Here is a breakdown of the fees that Hatch charges (and doesn’t charge).
- Monthly Fee: $10
- ATM Fee: First five in-network ATM withdrawals are free. After that, the in-network fee is $1.00. If you use an out-of-network ATM, you’ll be on the hook for whatever that provider charges for their ATM fees.
- Paper Check Fee: Your first five paper checks are free. After that, each one costs $1.00.
- Stop Payment Fee: $25
Most importantly, Hatch doesn’t charge for debit card replacement, ACH transfers, foreign transaction fees, or overdrafts.
Signing up with Hatch takes just a few minutes at HatchCard.com. Be prepared to enter your legal name, address, tax identification number, or social security number if you don’t have one.
Hatch may also ask for copies of an official government-issued ID and business documents. All of these items are standard practice for registering a business bank account.
Hatch offers a range of exclusive perks and discounts that many small business owners will appreciate, and especially those who are growing their businesses online.
Here are some of the top Hatch Perks:
- 20% off Constant Contact
- 3 months free on Gusto HR and payroll services
- $200 worth of Indeed Sponsored Job Credits
- 50% off Quickbooks for the first six months
- 14 day free trial on SEMRush
- $3,000 worth of free card processing with Square
- 20% off Unbounce
- 30 days free with We Advertise Your Business (WAYB)
- $300 in Yelp ad credits
- 30% off Zendesk (or 3 to 6 months free)
- 20% off Zenefits HR solutions
Hatch’s banking platform is backed by the larger financial institution, LendingClub Bank, Member FDIC, and Equal Housing Lender.
As a result, deposits are protected up to $250,000. Hatch’s online platform is powered by bank-grade encryption technology.
Furthermore, Hatch Business debit and credit cards are powered by MasterCard and Visa, respectively, both of which have numerous fraud protections in place.
If you need to speak with someone about your Hatch account, the company’s customer support team is available between 6 am and 5 pm Pacific Time. The number to call is 888-516-2369.
You may also submit a ticket through the online Help Center, which typically has a one-day turnaround time on requests.
It is important to note that Hatch is still fairly new, so there aren’t many reviews out there yet about customer service quality.
For any new bank to succeed these days, it must have top-notch customer service, so let’s hope Hatch follows that path.
Pros & Cons
- Low fees
- Transparent pricing
- No non-sufficient funds (NSF) fees
- Exclusive discounts for small business owners
- No savings account
- No brick and mortar branches
- Might be better for startups versus established businesses
Alternatives to Hatch
When it comes to fintech banks that serve small businesses, Hatch isn’t the only newcomer to the scene.
…are all online-only business banks that offer similar services to Hatch.
If you are in the market for a more traditional business bank account, you can’t go wrong with an account from:
…or from one of your local credit unions. You will most likely be looking at higher fees, though.
As for business credit cards, some of the more popular alternatives to the Hatch Line of Credit include the Capital One Spark Classic for Business and the American Express Business Cash Card.
Is my business eligible for Hatch Bank?
Most likely, yes. The majority of small businesses are eligible for an account and line of credit or personal credit cards with Hatch Bank.
To qualify, you will need to submit your business formation documents, proof if identification, and either your business’s tax identification number, or your social security number.
Can independent contractors apply for Hatch?
Yes. Hatch works with all kinds of entrepreneurs and businesses, from independent contractors to corporations, to limited liability corporations (LLCs).
If you are a freelancer or independent contractor and want to keep your side hustle finances separate from your personal finances (always a good idea), you would simply apply using your social security number instead of a tax identification number or employer identification number.
How much does Hatch cost?
Hatch charges a simple $10 monthly fee. Other than that, there are almost no fees.
Is the Hatch Business Checking account insured?
Yes, Hatch’s accounts are backed by LendingClub Bank, which is FDIC-insured. Therefore your deposits are protected up to $250,000.
Does Hatch have checks?
Yes, you can send checks through your dashboard. You can also send payments through ACH and bill pay.
Is Hatch Right For You?
As a small business owner, freelancer, or startup business seeking a bank account, it’s essential to keep a handle on your finances. Hatch can help you do just that, for a low monthly fee.
Hatch isn’t for everyone, though. For example, if you need to deposit cash, you’ll have to do that elsewhere.
Also, if you hope to establish a personal relationship with your banker, which may be helpful as your business scales, you won’t be able to do that with Hatch.
That said, Hatch has a lot to like, and its flexible, low-fee structure is sure to be appealing to many startup independent contractors alike.
As you search for your next business bank account, don’t forget that your bank should go the extra mile for you, and not the other way around.