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The right banking partner can help your startup streamline financial operations, offer important services tailored to your business needs, and provide the support necessary for growth.
With numerous options available, two banks that are often recommended for startups are Relay and Mercury Bank.
Relay and Mercury Bank offer several features to help new businesses manage their finances efficiently. However, each has its strengths and weaknesses, making the decision-making process challenging.
This blog post will simplify that process by providing a comprehensive comparison of Relay vs. Mercury Bank, including account setup, fees, features, customer support, and security.
What is Relay Bank?
Alt: relay bank platform
Relay Bank is a modern banking solution designed to meet the needs of small businesses and startups. Founded in 2018, Relay simplifies financial management for entrepreneurs by offering several powerful banking tools that integrate seamlessly with other financial software.
The features and services that Relay Bank offers include:
Business Checking Accounts
Relay provides business checking accounts with no monthly fees or minimum balance requirements. These accounts have features like check writing and bill pay, making it easier for startups to manage their finances.
Multiple Accounts and Cards
Relay Bank allows you to create up to 20 individual checking accounts under one account. This helps startups to organize funds for different purposes, such as payroll, taxes, and operational expenses.
In addition, Relay offers physical and virtual debit cards for each account, facilitating better expense management and control.
Financial Integrations
Relay integrates with popular accounting and bookkeeping software like QuickBooks, Xero, and Gusto. These integrations streamline the process of tracking expenses, reconciling accounts, and managing payroll, saving startups valuable time and effort.
Team Management
Relay allows startups to add team members and assign specific roles and permissions. This feature ensures that the right people access accounts, enhancing security and operational efficiency.
Automated Cash Management
Relay’s automated cash management tools help startups stay on top of their financial condition. Businesses can set up rules for automatic transfers between accounts, ensuring that funds are always where they need to be.
Target Audience and Market Focus
Relay Bank is meant for small businesses and startups that require a robust, flexible, and user-friendly banking solution.
Its focus on integrating financial tools and offering multi-account management makes it appealing to entrepreneurs who want to streamline their financial operations without the burden of excessive fees or complex banking processes.
Pros
- Enjoy a fee-free banking experience without monthly maintenance or overdraft charges.
- Maintain any balance without worrying about minimum requirements.
- Create and manage multiple accounts for better financial organization.
- Set spending limits on employee debit cards for better control.
- Easily integrate with various third-party vendors and financial tools.
Cons
- Cannot deposit cash into Relay accounts.
- Checks may take up to a week to clear.
- Lacks options for loans or credit products.
- Does not offer accounts that earn interest.
What is Mercury Bank?
Alt: mercury bank platform
Mercury Bank was launched in 2019 to provide banking services for startups and tech companies.
Headquartered in San Francisco, California, Mercury has become a favorite among entrepreneurs and tech-savvy business owners, thanks to its modern approach to banking and a suite of features designed to meet the unique needs of startups.
Its features and services include:
No Monthly Fees
Mercury eliminates the burden of monthly maintenance fees, making it an appealing choice for startups looking to minimize overhead costs.
Easy Account Setup
Mercury’s online account setup process is straightforward and efficient, allowing founders to get their banking needs sorted quickly without the hassle of traditional banks.
API Integration
Mercury offers powerful API integrations that enable startups to automate and streamline their financial operations. This feature is useful for tech companies that require seamless integration with their existing tools and software.
Virtual and Physical Debit Cards
Mercury provides virtual and physical debit cards, giving startups flexibility in managing their expenses and enabling remote teams to operate efficiently.
Target Audience and Market Focus
Mercury Bank’s target audience includes startups, tech companies, and small to medium-sized enterprises (SMEs) looking for a banking partner that understands their unique challenges.
The bank’s services are designed to support high-growth companies that need scalable solutions and the ability to adapt quickly to changing business environments.
Pros
- Mercury Bank charges no monthly maintenance fees, overdraft fees, or ATM fees.
- It integrates effortlessly with various third-party applications.
- Deposits are insured by the FDIC up to $5 million.
- API access enables the customization of dashboards, sweep rules, and automatic bulk payments.
Cons
- There is no option available for depositing cash.
- Savings and checking accounts do not accrue interest.
- An Employer Identification Number (EIN) is required for account application.
Relay vs. Mercury Bank: How are They Different?
Here’s a detailed comparison of Relay Bank and Mercury Bank to help you understand their differences:
#1 Account Setup and Accessibility
Relay Bank
Setting up an account with Relay Bank is straightforward and user-friendly, catering to the needs of busy startup founders.
Account Setup Process
- Online application: You can apply for an account through their website without visiting a physical branch.
- Required documentation: To open an account, provide standard business information, including your EIN, business formation documents, and personal identification for the primary account holder.
- Approval time: Relay processes applications within a few business days. Some users have reported getting their accounts approved within 24 hours, though it can vary based on the complexity of your business structure.
- User experience: Relay’s platform is known for its clean design, making navigation easy even for those who aren’t tech-savvy.
Accessibility
- Mobile and web access: Relay offers a mobile app and a web platform, ensuring you can manage your finances on the go or from your desktop. Any action taken on one is reflected in the other.
- User interface: The user interface is designed with simplicity in mind. Dashboards are customizable, allowing you to see the most critical information at a glance.
- Team management: Relay allows you to add multiple users to your account, making it easier to manage team finances. Permissions can be tailored to ensure each team member can access only important information.
Mercury Bank
Mercury Bank has a smooth and efficient account setup process that meets the demands of startups.
Account Setup Process
- Online application: Similar to Relay, Mercury Bank offers a fully online application process. Their website is optimized to handle the entire setup without requiring physical documents.
- Required documentation: Opening an account with Mercury requires providing your EIN, business formation documents, and personal identification. Mercury also supports international founders who have U.S.-based businesses.
- Approval time: Mercury is known for its quick approval process. Many users report having their accounts approved within 1-2 business days, though this can vary.
- User experience: The application process is seamless, with a user-friendly interface that guides you through each step.
Accessibility
- Mobile and web access: Mercury provides robust mobile and web platforms. Both versions are highly functional, allowing you to manage your banking needs from anywhere.
- User interface: Mercury’s interface is minimalist and modern, focusing on providing a smooth user experience. The design prioritizes ease of navigation and quick access to essential features.
- Team management: Mercury allows you to invite team members to your account and set specific permissions for each user.
Summary
Relay and Mercury Bank offer efficient, user-friendly account setup processes tailored for startups. They emphasize ease of access through robust mobile and web platforms, ensuring that you can manage your business finances anytime, anywhere.
Relay stands out with its customizable dashboards and straightforward navigation, while Mercury is known for its sleek design and fast approval times.
The best choice will depend on your needs and preferences, but both banks provide excellent options for startups looking for a hassle-free banking experience.
#2 Features and Services
Relay Bank
Relay Bank offers a comprehensive suite of features tailored to meet the needs of startups and small businesses.
Here are some of the main services:
- Business checking accounts: Relay provides fee-free business checking accounts with no minimum balance requirements. Startups can open multiple checking accounts under one business to manage different income streams or expense categories efficiently.
- Team banking: Relay allows multiple users to access the business account, making it easy for team members to handle financial tasks. Each user can be assigned specific roles and permissions, ensuring secure and streamlined financial management.
- Expense management: With Relay, businesses can issue up to 50 physical or virtual debit cards to team members. Each card can have customizable spending limits, providing better control over company expenses.
- Integrated bill pay: Relay’s bill pay feature lets users manage all their payments in one place. Businesses can schedule payments, set up recurring bills, and track payment statuses, thereby reducing administrative burdens.
- Accounting integrations: Relay integrates seamlessly with popular accounting software like QuickBooks Online and Xero. This integration ensures automatic synchronization of transactions, simplifying bookkeeping and financial reporting.
- No monthly fees: Relay offers its main banking services without monthly fees. This cost-effective approach makes it an attractive option for startups looking to minimize overhead expenses.
Mercury Bank
Here are the services that Mercury Bank offers:
- Startup-friendly checking and savings accounts: Mercury offers both checking and savings accounts with no monthly fees and no minimum balance requirements. This flexibility is important for startups managing fluctuating cash flows.
- Virtual and physical debit cards: Mercury provides virtual and physical debit cards, allowing startups to manage expenses efficiently. Virtual cards can be issued instantly, making it easy to control online spending.
- API access: Mercury’s API access allows startups to integrate their banking data with their internal systems, facilitating custom financial solutions and automation.
- Treasury management: Mercury offers treasury management services for startups with larger cash reserves. This feature helps businesses optimize their cash management and maximize interest earnings.
- Cash flow analytics: Mercury provides advanced analytics tools to help startups monitor and analyze their cash flow. These insights can be critical for making informed financial decisions and planning for growth.
- Integration with accounting software: Like Relay, Mercury integrates with accounting platforms such as QuickBooks and Xero. This ensures that transaction data is automatically synced for easy bookkeeping.
Summary
Relay and Mercury Bank offer services to different aspects of startup banking. Relay focuses on providing a seamless, no-fee banking experience with strong expense management and team collaboration tools.
Mercury, on the other hand, offers advanced features like API access and treasury management, making it appealing to tech startups with more complex financial needs.
#3 Security and Reliability
Relay Bank
Security Measures
- Encryption and secure access: Relay uses industry-standard encryption protocols to ensure that all data transmitted between users and the bank’s servers is secure. This includes SSL/TLS encryption for all web and mobile app interactions.
- Multi-factor authentication (MFA): To enhance account security, Relay offers multi-factor authentication. This requires users to verify their identity through additional steps like SMS codes or authentication apps.
- Fraud detection: Relay has implemented sophisticated fraud detection systems that monitor account activity for suspicious transactions. These systems are designed to identify and respond to threats in real-time.
- Data protection: Relay is committed to protecting user data and adheres to strict data privacy regulations, ensuring that personal and financial information is stored securely and is not shared with unauthorized third parties.
Reliability
- Uptime and performance: Relay boasts a high uptime percentage, ensuring that users have access to their accounts and banking services without interruption. The bank’s infrastructure is designed to handle high traffic volumes and provide a seamless user experience.
- Service redundancy: To minimize the risk of downtime, Relay has multiple layers of redundancy built into its systems. This includes backup servers and failover mechanisms that ensure continuous operation even during hardware failures.
- Customer feedback: User reviews and testimonials generally reflect a positive experience with Relay’s reliability. Customers report minimal downtime and a responsive platform that meets their banking needs efficiently.
Mercury Bank
Security Measures
- Advanced encryption: Mercury uses advanced encryption techniques to secure data transmission between its users and servers. All sensitive information is encrypted both in transit and at rest.
- Multi-factor authentication (MFA): Mercury requires multi-factor authentication for all user logins, adding an extra layer of protection against unauthorized access. This includes using authentication apps, biometrics, or SMS codes.
- Continuous monitoring: Mercury has a robust security monitoring system that scans for vulnerabilities and unusual account activity. This proactive approach helps identify and mitigate threats before they can cause harm.
- Compliance and certifications: Mercury complies with major financial regulations and standards, such as PCI-DSS (Payment Card Industry Data Security Standard), to ensure the highest level of security for its customers.
Reliability
- High availability: Mercury provides high availability and uptime for its banking services. The bank’s infrastructure is designed for resilience, ensuring that users can access their accounts and perform transactions without disruptions.
- Scalable infrastructure: Mercury uses a scalable cloud-based infrastructure that can handle increasing users and transactions. This scalability ensures that performance remains optimal even during peak usage times.
- User reviews: Feedback from Mercury’s customers generally indicates high satisfaction with the bank’s reliability. Users appreciate the consistent access and performance of the platform.
Summary
Relay and Mercury Bank use advanced encryption, multi-factor authentication, and continuous monitoring to protect their users. They boast high uptime and scalable infrastructure to ensure seamless banking experiences.
Neither bank has experienced major publicized security breaches, reflecting their commitment to maintaining robust security measures.
#4 Customer Support
Relay and Mercury Bank provide efficient and helpful services to their users in terms of customer support. However, there are differences in their approaches and the quality of support offered.
Here’s a closer look at how each bank handles customer support:
- Channels of support: Relay offers phone, email, and live chat support, while Mercury provides email and live chat support but lacks phone support.
- Response time: Both banks are known for quick response times, with live chat being the fastest method of communication for both. Relay’s email support typically responds within 24 hours, while Mercury’s email support often replies within a few hours.
- Quality of service: Relay and Mercury receive high marks for the quality of their customer support, with knowledgeable and helpful teams. Relay offers friendly and approachable service, while Mercury is praised for technical expertise.
#5 Fees and Costs
Relay Bank
Relay Bank offers two pricing models for small businesses (namely Relay and Relay Pro) as shown in the image below:
Alt: relay bank pricing
Mercury Bank
Mercury does not charge monthly fees, overdraft fees, ATM fees, or wire transfer fees (though intermediary banks might charge a fee, which Mercury covers up to a flat rate of $15).
However, foreign transactions incur a 1% currency exchange fee.
Also, some advanced features (like optional premium processing for international transactions, bulk payments through the Mercury API, and Treasury account management) may have associated costs.
Relay vs. Mercury Bank: Tabular Comparison
Relay Bank
Mercury Bank
Account Setup and Accessibility
- Easy online account setup.
- Minimal documentation required.
- User-friendly mobile and web apps.
- Streamlined online account setup.
- Requires basic documentation.
- Intuitive mobile and web apps.
Fees and Costs
- No monthly maintenance fees.
- Fees for certain transactions.
- Potential costs for additional services.
- No monthly maintenance fees.
- Transaction fees apply.
- Transparent fee structure with no hidden costs.
Features and Services
- Checking accounts.
- Virtual cards.
- Team management features.
- Integration with financial tools.
- Checking accounts.
- Payment processing capabilities.
- Virtual cards.
- API integrations for startups.
Customer Support
- Support available via phone, email, and chat.
- Generally responsive.
- Mixed customer reviews.
- Support available via email and chat.
- Quick response times.
- Positive customer feedback.
Security and Reliability
- Strong security measures.
- No major reported breaches.
- Reliable service with minimal downtime.
- Robust security protocols.
- No significant security issues reported.
- High reliability and uptime.
Wrapping Up
Relay and Mercury Bank are both great banking options for startups. Relay stands out with its streamlined account setup, robust financial management tools, and transparent fee structure, making it a strong choice for startups looking for a user-friendly and cost-effective banking solution.
Its focus on integration with financial tools and virtual cards can be useful for businesses that require detailed financial oversight and flexibility.
On the other hand, Mercury Bank excels in offering features designed to support high-growth startups, including comprehensive banking services and excellent customer support.
The banking platform’s focus on providing a reliable and secure banking experience, coupled with its innovative approach to financial management, makes it an attractive option for startups with more complex needs or those in rapid expansion.
The best choice between Relay and Mercury Bank depends on your startup’s specific needs and priorities. If you value simplicity and cost-effectiveness, Relay may be the ideal fit.
However, if you’re looking for advanced features and superior customer support, Mercury might be the better option.
FAQs
How reliable is Mercury Bank?
Mercury Bank is considered reliable for businesses, especially startups and tech-focused companies.
It has attracted positive reviews for its user-friendly interface, robust API access, digital-first approach, FDIC insurance, and no-fee checking accounts.
Is Relay Bank trustworthy?
Relay Bank is trustworthy. It's a popular choice among small businesses due to its user-friendly interface, robust features, and FDIC insurance (your deposits are protected up to $250,000).
Can you trust Mercury?
Yes, Mercury is generally considered trustworthy. Here's why:
- FDIC insured: Your deposits are protected up to $5 million through their partner banks and sweep networks.
- Positive reputation: Mercury has a strong reputation among startups and tech-focused businesses for its user-friendly platform and robust features.
- Security measures: The bank employs various security measures to protect customer information and funds.
