Live Oak Bank is a digitally focused bank that focuses on serving small businesses and their owners across the country.
Their goal is to help businesses buy, build, expand, and operate their businesses by offering exceptional lending and banking services.
If you’re looking for a bank to support your goals as a business owner, Live Oak Bank is a great place to consider.
Keep reading to learn more about Live Oak Bank, its products and services, pros and cons, and more.
What is Live Oak Bank?
Live Oak Bank is a cloud-based online bank headquartered in Wilmington, North Carolina.
They are best known for providing banking products and services to entrepreneurs, freelancers, gig workers, and self-employed individuals.
They are the country’s number-one SBA 7(a) lender by dollar volume, and they control over $3 billion in assets and $2 billion in deposits.
Originally founded in 2007 as a lender for veterinary practices, Live Oak is most popular for its small business checking account, which offers all the bells and whistles of a standard business checking account without the fees and unnecessary features.
Live Oak is also known for its interest in innovation and technology. They recognize that the world operates in the digital realm, which is why they streamline their loan applications and underwriting processes entirely online.
Overall, they are best for small business owners who are comfortable with doing all their banking online.
Live Oak Bank Products
Live Oak Bank offers three different products for business customers:
1. Small Business Checking
Live Oak’s small business checking account is the perfect no-frills account for small business owners who want to deposit their money, pay bills, and transfer money with ease.
There are no monthly maintenance fees or account opening fees, which is perfect for the money-savvy solo entrepreneur.
However, there is a $100 minimum opening balance to create an account.
Live Oak does an excellent job spelling out exactly which customer will best benefit from each account.
For the small business checking account, they advise that businesses that accept Venmo, Square, PayPal, or Stripe; make limited monthly transactions, and manage their own finances will be a great fit.
Business owners that need to make cash deposits or are cash-heavy will not be a great fit.
2. High-Yield Savings Account
One of Live Oak Bank’s most notable products is its high-yield savings account.
They boast an impressive interest rate of 3.50% on account balances, which is around 12 times the national average savings rate.
Live Oak wants to make online banking easy, and the Live Oak Bank savings account reflects this mission.
When you open an online savings account with Live Oak, you will not be charged monthly maintenance fees or be subject to any minimum balance requirements.
You will be able to link external accounts to your Live Oak account to easily transfer ACH funds to earn the high rate.
3. Certificates of Deposit
In addition to the high-yield savings account, you can also save money for your business with the Live Oak Bank CD or certificate of deposit.
CDs are a great way to earn high APY (annual percentage yield) on a portion of your savings by setting it aside for a portion of time without touching it. Once the set period is up, you will earn back interest from the CD rates.
Live Oaks’ certificate of deposit accounts is competitive compared to other CD offers.
|Live Oak Bank 1 Year CD||5.00% APY||$2,500|
|Live Oak Bank 6 Month CD||4.80% APY||$2,500|
|Live Oak Bank 18 Month CD||2.00% APY||$2,500|
|Live Oak Bank 2 Year CD||2.00% APY||$2,500|
|Live Oak Bank 3 Year CD||2.00% APY||$2,500|
|Live Oak Bank 4 Year CD||2.00% APY||$2,500|
|Live Oak Bank 5 Year CD||2.00% APY||$2,500|
Live Oak Bank Features
Compared to other online banks, Live Oak Bank offers minimal bells and whistles.
In part, this is how they can offer such exceptional rates on their products and services; less money spent on frivolous extras means more money they can give back to you.
But Live Oak does have one feature that is essential to any online bank worth its weight: a mobile app.
Live Oak’s mobile app, which is available for iOS and Android devices, lets you do everything you need to and more all from one simple location.
You can manage your bank accounts (including linked external bank accounts), transfer funds, view external bank statements, deposit checks, set up banking alerts, and much more.
Unfortunately, Live Oak mobile users think that the app still has a long way to go. It only has a 2.8-star rating out of 5 on the App Store, and it has a 3.5-star rating out of 5 on Google Play.
As a small business owner, you probably have minimal funds to throw around, and you especially don’t want to be throwing your hard earned cash away on banking fees.
One of the biggest draws of small businesses and self-employed people to Live Oak is that they have minimal to no fees on all their banking products.
According to Live Oak Bank, these are the account fees (or lack there of) that you can expect to pay when you bank with them:
- Monthly Maintenance Fees: $0
- Transaction Fees: $0, 3% on foreign transactions
- ATM Fees: $0 on 55,000+ in-network ATMs
- Minimum Opening Deposit: $100
- Minimum Balance Requirements: $0
Based on your account, you may face other fees, such as incoming or outgoing wire transfer fees or early withdrawal penalties.
Be sure to check the specific product page for fees that may apply in specific situations, like overdrawing your account or transferring funds via wire.
Getting started with Live Oak Bank is simple and straightforward. Here is what you need to do to open your account:
- Go to Live Oak Bank’s homepage and click “Get Started”
- Select “Business Banking” or “Personal Banking” and select your product
- Provide the information requested including:
- Social security number
- Contact information
- Employment status
- If applicable, information about your business
- Submit your application
- When approved, deposit money into your account at an ATM or from an external bank
Live Oak Bank Promotions
Unfortunately, there are currently no active Live Oak Bank promotions. Check out these bonus offers instead:
|Citi® Citi Priority Account||up to $2000||July 23, 2023||
|U.S. Bank U.S. Bank Smartly® Checking||up to $400||June 20, 2023||
|U.S. Bank Business Checking||up to $750||June 30, 2023||
As an online bank, Live Oak understands the importance of cybersecurity. That is why they employ all the latest software, procedures, and technologies to ensure that all your private information is protected at all times.
- Live Oak Bank uses anti-virus and -malware protection to help them detect and prevent online attacks from malicious software.
- They also utilize firewalls to help them block unauthorized attempts to access accounts and account information.
- They have Secure Socket Layer (SSL) encryption in place that creates a secure connection between your browser and their cloud whenever you do things like fill out loan applications or access your online account.
- Live Oak also takes measures to protect you from fraud and identity theft. They utilize fraud and threat management analytics to detect unusual activity and spot hackers more quickly.
- You can also enroll in multi-factor authentication so you know exactly when someone is trying to get into your account.
As an online bank, Live Oak Bank faces some barriers when it comes to customer service.
After all, they don’t have any branches that you can go to to ask your questions. Despite this, Live Oak offers customer support that is on par with what you can expect from other digitally focused financial institutions.
You can reach out to Live Oak’s customer support department via telephone (1-866-518-0286) on weekdays from 8 a.m. to 8 p.m. EST.
You can also reach out to the department by mail or submit an online ticket on their website. If your question is relatively simple, you can check to see if it is answered on their FAQ support site.
Pros and Cons
There are always pros and cons to consider before you begin banking with a new credit union or bank. Here are some to consider before opening a new account with Live Oak Bank.
- Competitive rates: Live Oak offers competitive rates on their savings account and certificates of deposit (CDs). As of the writing of this article, they are advertising a rate of 4.5% APY on their CD accounts and 3.1% APY on their business savings account, roughly 12 times the national average.
- Minimal to no fees: One of the most important factors for a small business is to minimize fees. With no minimum balance requirement, monthly fees, or ATM fees, you can keep your money where it belongs: your account.
- Mobile friendly: Managing your Live Oak account is simple through their mobile app. But the ability to also manage your other accounts through the Live Oak app is truly something unique.
- No branches: If you are more old school and like to do your banking in person, you’ll probably be pretty frustrated by Live Oak’s online-only approach.
- Minimal personal banking offerings: Live Oak advertises itself as a bank for small businesses, but they do offer personal banking products. Unfortunately, these are limited to a savings account and certificates of deposit.
- No customer service on weekends: Live Oak’s customer service team is available on weekdays from 8 a.m. to 8 p.m. EST. If you need assistance from them outside of that window, you will need to check the FAQ site or wait until their next business day.
Alternatives to Live Oak Bank
Curious about more options for your small business? Here are some of our top alternatives to Live Oak Bank
Ally is a popular online bank that offers a fuller banking experience when compared to Live Oak Bank.
Ally offers money market accounts, which isn’t offered by Live Oak. If the ability to let your money compound daily is a major plus, you may consider Ally’s money market account.
Ally also has a nifty feature called “savings buckets” that allows you to set money aside for your specific savings goals. Let’s say you’re a food truck owner, and you’re saving up for a new fryer for your truck.
You can create an individual savings bucket for that goal, and you can track your progress toward that savings goal.
Marcus is a great option compared to Live Oak if you are worried about your ability to keep money in a certificate of deposit account.
One of the main drawbacks of CDs is that they require you to not touch your money for a particular period of time.
If you decide that you need to take your money out, you could be subject to early withdrawal penalties, which can defeat the purpose of putting your money in a CD in the first place.
Marcus is ideal for people who want to try out a CD but want the flexibility to withdraw their money if needed. They don’t charge any penalty fees for withdrawing, which can be a comfort to a small business owner who needs their money accessible.
Frequently Asked Questions
Is Live Oak Bank trustworthy?
Live Oak Bank is rated A+ by the Better Business Bureau, which assigns ratings based on trustworthiness, business practices, and customer experiences. Based on their rating, the BBB and customers agree that Live Oak is an exceptionally trustworthy bank.
Who owns Live Oak Bank?
Live Oak Bank is a subsidiary of Live Oak Bancshares. It was founded by James “Chip” Mahan, the bank’s founder, chairman, and CEO.
When was Live Oak Bank founded?
Live Oak Bank was founded in 2007 in Wilmington, North Carolina as a lender for veterinarians.
Is Live Oak Bank FDIC insured?
Like most financial institutions, Live Oak Bank is a member of the Federal Deposit Insurance Corporation, also known as the FDIC. As a member of FDIC bank, Live Oak Bank insures all accounts up to $250,000 per depositor. This means your money is protected no matter what.
Is Live Oak Bank Best for You?
Live Oak Bank’s mission is to be known as America’s small business bank. It follows that their ideal customer is going to be involved in owning a small business or being self-employed in some way.
Per Live Oak, you will most benefit from their products and services if you are a newly-formed business, a microbusiness, a gig worker, a freelancer, or any other self-employed person.
They define the ideal small business customer as a business with five employees or less, has been in business for less than five years, and earns anywhere from $50,000 to $500,000 in annual revenue.
Live Oak would not be a good fit for cash-heavy businesses as customers are not able to make cash deposits into this account.
While Live Oak offers personal banking services and loans, these products are meant to be an augmentation to business products and services so that business owners can have all their money under one roof.
However, Live Oak will not discourage anyone from opening an account if they do not have business accounts open.