Lili Business Banking Review 2023

Business owners and freelancers are used to the feast or famine nature of inconsistent income. Keeping costs low isn’t just an option -- it’s a must. 

Lili has built a checking account product designed to be freelancer and small business friendly. It offers great expense management, tax savings, and reporting features. And its Basic account comes with no monthly fee. 

But does Lili offer enough small business-specific features that you should consider switching from your current business checking provider? Let’s find out.

Who Is Lili?

Lili is a banking fintech that is oriented toward freelancers and small business owners. Lili is a financial technology company and is not a bank. Banking services provided by Choice Financial Group, Member FDIC. 

It was founded in November 2018 and is based in New York City. Its founders are Lilac Bar David and Liran Zelkha. Lili has raised $80 million.

"We believe the future of work is freelance, and as the pandemic has recently changed everything about how people approach their careers, the American workforce’s shift toward independence has accelerated even faster than we anticipated." said Bar David.

Bar David says that Lili has seen exponential growth in demand over the past few months. She believes the reason for this is that more people are looking for banking solutions that are tailored to independent, freelance business owners.

What Do They Offer?

Lili offers business banking services to Sole Proprietors, Single member LLCs, Multi Member LLCs, General Partnerships, Limited Liability Partnerships, and S-Corps. 

After you sign up for Lili, you'll download the mobile app to manage everything. If you prefer to use Lili's website, you can now access Lili there as well.

If we consider that most freelancers are working on a desktop or laptop, they're likely logging into their banking account from a browser on one of those computers. 

Deposits And Payments

Each checking account comes with a Visa business debit card. Some people may balk that there isn’t a business credit card. However, Lili is a checking account product so providing an accompanying debit card makes sense.

From the mobile app, you can freeze or unfreeze the debit card, and for businesses with multiple owners, Lili now offers multi-user access and a debit card for each business owner. 

The debit card is issued by Choice Financial Group, Member FDIC, pursuant to a license from Visa U.S.A. Inc. 

Like other banks, Lili's customer get a routing number so that they can set up direct deposit with their clients. But where Lili shines is in the delivery speed of those deposits. It says that its customers receive direct deposits up to two days earlier than they would at a traditional bank. Right now, you can't deposit more than $50,000 per month into your account, but the Lili team says that it has plans to increase these limits soon.

Plus, Lili provides cash deposits through leading retailers (approximately 90,000 locations) and users can connect their existing payment apps (Venmo, CashApp, Paypal) and online platforms (i.e, Fiverr, Upwork) to Lili to receive payments directly into their bank account.

In addition to direct deposit, Lili now accepts income domestic wire transfers. This provides Lili customers with another payment option, making it faster and easier to get paid. There is no charge to receive domestic wires, nor is there a limit to the wire amount or the number of wires you can receive. 

According to Lili, customers will have access to funds wired into their account no later than the next business dat after the funds have been received by Lili (providing the wire has been received by 4PM EST on any business day. 

One area that is disappointing is mobile check deposits. The feature is available in the mobile app, but you'll need to have at least $200 coming into your account every month to access it.

This may not be a hurdle for some freelancers. But others will need to figure out a way to get that first $200 into your account per month without making a mobile deposit. One potential solution would be to start depositing any paper checks after your first digital payment arrives.

Freelancer Benefits

Where Lili really benefits freelancers is in its reporting and tools. It's why we name it a great tool for business budgeting.

Each time you use your Lili debit card, the transaction will appear inside the app. Then, by just swiping left or right, you can categorize each expense as "personal" or "business."

In addition to simplifying expense categorization, Lili offers reporting for expenses, taxes, and financial insights. This is more than what you'll find on standard checking accounts.

Many small business owners may pay for financial management software that provides these reports for them. So if Lili’s free reporting is able to provide the same features that you’re getting from your accounting software, you may be able to cancel your software account and reduce your expenses.

Beyond the reporting, Lili has a great tax saving tool which allows you to automatically set money aside for taxes on every income, and an Emergency Bucket, which helps users set money aside for emergencies with daily deposits of small amounts. For example, you can set a fixed daily amount, as little as $1 a day, to save for emergencies.

For freelancers who may not know how much to save for taxes (or forget altogether), this can be a lifesaver at tax time. And Lili says that it will soon be able to generate Schedule Cs for its account holders too.

Related: Tax Deductions For Your Online Business Expenses

Mobile App And Desktop Support

Lili was founded as a mobile-first company, but over the last year they've rolled out desktop support as well. This is very helpful for freelancers who need access to reporting and found it tedious to email yourself reports to view.

Lili Account Plans

Lili now offers four account plans: Basic, Pro, Smart, and Premium, which include the following features: 

• Business checking account (Basic only)
• Advanced Business Checking Account (Pro, Smart, and Premium plans)
• Visa® Business debit card (Basic only)
• Visa® Business Pro debit card with Cash Back Rewards (Pro and Smart plans only)
• Fee-free ATM withdrawals at 38K locations
• Get paid up to 2 days early
• Receive domestic wire transfers
• Automatic Tax Savings
• Fee-free Overdraft up to $200
• 4.15% APY on Savings
• Metal Visa® Business Pro debit card with Cash Back Rewards (Premium only)

The mid-range Lili Smart plan, which Lili recommends, adds valuable accounting features, including Smart Bookkeeping, Financial Reports, Unlimited Invoices and Payments, and Tax Reports (1065/1120/Schedule C). 

Finally, Lili Premium builds on the features of the Smart plan by unlocking access to priority customer support, which includes a dedicated Account Specialist, and an upgraded debit card (Metal Visa® Business Pro debit card with Cash Back Rewards.)

Are There Any Fees?

As you can see from the above chart, aside from the Basic account, which is free, all of the Lili account plans charge a monthly fee. The Pro plan is $9.00 monthly, Smart is $20.00, and the new top tier Premium plan is $35.00. What you have to decide is whether the various plans are worth the cost, based on your needs. 

How Do I Open An Account?

You can visit the Lili website to open an account. It only takes about 3 minutes.

The company recently announced that support is coming for Single Owner LLCs. So if you're a sole proprietor who incorporates as a Single Owner LLC, you'll soon be able to open a Lili account using your business details.

Once you complete the application on the website, you’ll download the mobile app to begin using Lili. Your Visa debit card should arrive within 10 business days, but you can start using your digital debit card immediately.

Is My Money Safe?

Yes, Lili uses bank-grade encryption and deposits are FDIC-insured up to $250,000 for each depositor through its partner bank Choice Financial Group, Member FDIC.

You can also freeze and unfreeze your debit card at any time. Additionally, you can receive real-time transaction notifications.

Is It Worth It?

If you're a freelancer who already prefers to do your banking on your phone, Lili could be a good choice. The fees are reasonable when you consider all of the features you get, especially with the Smart account plan, which offers the most value.

If you want more features than the Basic plan offers, but the monthly fees are a concern, you may want to consider other business checking accounts like LendingClub Bank's Tailored Checking or Novo, which may be more affordable choices.

See all 10 of our favorite business checking accounts for small business >>>

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