ANNA Money is something that works as an alternative business banking option for small businesses, freelancers or digital-nomads based in the UK.
It is difficult to define ANNA Money as a ‘bank’ in the conventional sense, but it does provide the ability to hold a current account and business debit card.
What is ANNA Money?
ANNA stands for “Absolutely No Nonsense Admin”, which is a UK-based solution for current account banking for small business owners in the UK. The platform provides UK business owners with a simple business account which takes the complexity out of receiving and sending money, as well as a further function of ensuring that the business invoices are paid on time.
ANNA Money has been around since 2018, and boasts a customer base of 6,000 UK business owners in the UK. This shows that ANNA are very much in their early stages of business.
At this moment in time, ANNA is only available to UK residents who are directors of a UK-based Limited Company, Partnership, or Sole Trader company. Therefore, if you’re a freelancer, you will be required to have set your company up as such in order to take advantage of ANNA’s services.
ANNA takes a laid-back approach to their branding. Nothing akin to your conventional bank branding. This may be a breath of fresh air for some, or a little too unique for others. It is important to note that ANNA isn’t unprofessional in their setup, more that they aren’t quite as “stiff” as most banks.
ANNA is not technically registered as a bank or building society, but their branding states that they are a mobile business account. In terms of their functions, this means they allow you access to payments via a debit card in the same manner as a bank, just without the label of being a bank.
How does ANNA Money Work?
ANNA Money is pretty straight forward in their offerings and key services. This means that if simple money functions for your business are essential, and you’re fed up with all the extra fluff that high-street banks provide, then this may be the solution for you.
The staple of ANNA Money’s offering is their current account platform. You will be given a UK Account Number and Sort Code, as you would normally expect with a bank account. This means that you can use your account to send and receive money in the same manner you are used to. ANNA makes the process seamless and pain-free, and you should have no issues paying suppliers, or receiving payments from clients.
The ANNA Money current account is supported by ‘Faster Payments’, which means that payments to any other UK bank accounts can be performed instantly. Any payments or transfers of funds to clients or suppliers based overseas would be initiated via a SWIFT payment.
As previously stated, ANNA is not technically a bank. This means you do not have access to any credit facilities such as Credit Cards or Loans. Therefore, the bread and butter of ANNA’s offering is their debit card. This is a MasterCard backed debit card.
This card offers no frills whatsoever. It allows you to withdraw money from ATMs, purchase items in shops as well as online. The usual functions you would expect from a debit card. However, there are some limitations depending on the tier of ANNA Money card you possess.
The ANNA Money invoice assistance is what really makes the company stand out and become an attractive prospect. If your business sends out a lot of invoices on a regular basis, then ANNA is able to help you here. You can create the invoices seamlessly through the app, and populate pre-saved templates for your regular clients. This saves a shedload of time in the long run, especially when it can be done on the fly via your mobile phone.
ANNA will also help you in chasing your clients for payment of invoices too! The platform employs AI or Machine Learning in order to chase unpaid invoices for you, without you needing to lift a finger!
ANNA Money Fees
As with most online money platforms these days, there is a free trial available for three months (which is longer than most offer). This will allow you to give the platform a really good test-run before you decide whether or not it is for you.
Once you have completed your free trial though, there is a pretty significant fee. The standard ANNA flat fee comes to £11 per month. However, I think when you consider the benefits of the Invoice Assistance, you may view this £11 per month to be worth it, as it could be the difference between you being paid an invoice on time, or not.
On top of the Invoice Assistance, you will get 24/7 customer service, which most banks do not offer. So, while the fees may be higher than a standard bank on paper, you are getting quite a lot for your money.
There are five different tiers which you can have on your ANNA account. These are noted as ranging from A to E, and each tier offers different limitations to your account.
This permits you to have a maximum account balance of £1,500 and your money coming in/out is limited to £2,000 inbound and £1,000 outbound per month. This tier of account is going to be useful to very few businesses, especially when you consider the £11 per month fee.
Despite the strict limitations of Tier A, in reality once you activate your business debit card, your account status is moved to Tier B. This significantly changes the limitations on your account. Your business will now be able to send and receive up to £40,000 per month, and £25,000 can be kept as a balance on the business debit card.
The Tiers then progressively increase as expected until you reach Tier E, which increases your limits substantially. Your maximum debit card balance balloons up to £700,000, and you will be able to have incoming/outgoing balances of £500,000 respectively per month. This will obviously only be an option for larger businesses. However, if this is even not enough for you, then a custom plan can be created by contacting ANNA directly.
This offers quite a growth perspective for small businesses, and it can be seen that ANNA acts as a good platform for new businesses to grow over time with ANNA by their side. It is possible to request higher limits within ANNA, with reduced fees, as long as your business has a monthly income of over £1 million.
Is ANNA Money Safe?
As previously mentioned, ANNA is not a bank or building society. This, inherently, provides less protection over your money and assets than a traditional bank. Your funds are not backed by the UK’s FSCS scheme. This means that if ANNA were to go bankrupt, there is the potential for you to lose your funds. This may be enough of a reason for people to not consider using ANNA.
However, as some added protection, ANNA is regulated by the Financial Conduct Authority (FCA).
Alternatives to Anna Money
ANNA has a myriad of competitors in this space, which means that it really needs to stand out from their competitors. Tide and Starling bank are key notable competitors (read the comparison article here). The key here is to look at the specific features of each option, and really break down which option provides the most benefit to your specific situation.
Pros and Cons to ANNA Money
- Fantastic Customer Service options (24/7 option)
- Pain-free sign-up process
- Fees are easy to understand, and no hidden costs
- Automated invoice chasing
- Not a bank, so not protected in the same way
- No cash and cheque deposits
- Must be used via mobile (no web browser option)
ANNA is ideal for self-employed freelancers and entrepreneurs who enjoy the mobile centric focus of ANNA. However, there are some significant limitations within the ANNA offering, and the glaring issue is the limitation of protection due to not being an official bank or building society. Many will view this as a live or die fact.
Due to the inability to deposit cash into your ANNA account as well, this basically makes the account redundant for business-types which deal heavily in cash payments. However, it would work favourably for online businesses who only deal with bank transfer payments.
The account would not be suitable for those with regular international clients. ANNA’s strengths simply do not lie in this area, and a conventional bank account is likely to meet your needs better if you do require regular international payments.
However, the invoice chasing function is a real winner here. If you’re a UK-based business which deals only with bank transfers and local UK clients then ANNA stands out as a real winner amongst a crowded space of competitors.