Home Personal Finance Lili Bank Account for Freelancers: 2021 Review

Lili Bank Account for Freelancers: 2021 Review

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The Lili bank account has no monthly fees, no minimum opening deposit and is completely mobile — with an app available for iOS and Android devices. Lili is designed specifically for freelancers and independent contractors, offering digital tools that allow you to categorize your business and personal expenses, save for taxes and accept payments from customers within a single account.

Lili banking is best for small-business owners who:

  • Want a free bank account with no minimum balance requirements.

  • Are using their Social Security numbers for tax purposes.

  • Deposit less than $6,000 in checks on a monthly basis; send less than $1,000 to external bank accounts on a monthly basis.

  • Want integrated tools to help them sort their expenses and save for taxes.

  • Are OK with a mobile-only banking experience.

Pros and cons

  • No monthly fees, minimum balance requirements, or minimum opening deposit.

  • Unlimited fee-free transactions.

  • Fee-free ATM access through the MoneyPass network; cash deposits available through Green Dot locations.

  • Integrated tools for managing expenses and planning for taxes.

  • Offers early payment feature with direct deposit, allowing you to receive funds up to two days sooner than you might with a traditional bank account.

  • Low monthly limits for mobile check deposits and external bank transfers.

  • Mobile only, no web access.

  • Can’t use an employer identification number to apply.

  • Out-of-network ATM fees, $2.50 for U.S. ATMs, $5 for international ATMs.

  • No checkbooks; can’t send or receive wire transfers.

  • Limited business-related features, e.g. doesn’t offer joint accounts, multiple business debit cards,  invoicing tools, third-party integrations.

Lili bank account at a glance

Minimum opening deposit requirement:

Unlimited fee-free transactions

at Lili, Deposits are FDIC Insured

How the Lili bank account works

Lili is a mobile bank account catering specifically to freelancers and independent contractors. As Lili is not a bank, its banking services are provided by Choice Financial Group and deposits on all accounts are insured up to $250,000 by the Federal Deposit Insurance Corp.

To open a Lili bank account, you will need to download the mobile app and provide your email address. You’ll complete your application by filling out your name, phone number, date of birth, Social Security number and mailing address. You also will need to choose what type of freelancer or contractor you are from a dropdown list that Lili provides.

After you submit your application, you should receive approval and account access almost instantly. It’s important to note that although Lili is completely mobile, you do have the option to use its website to apply for an account.

If you apply for an account online, you’ll follow the same steps to complete and submit your application. Once your application is approved, you’ll download the mobile app and pair your device using a verification code that can be sent to you via text message or email.

Regardless of how you sign up for Lili banking, you will use the mobile app to fund your account and manage your expenses. You can fund your account using direct deposit, ACH transfers or mobile check deposit, and by linking external bank accounts or platforms like Venmo and PayPal.

Although it can take up to two weeks for your Lili Visa business debit card to be delivered, you’ll be able to use a digital version of your card through the Lili app. You’ll also be able to track the progress of your physical card in the main screen of the mobile app. Once you receive your card in the mail, you’ll need to activate it within the app before you can use it.

If you’re operating as a “doing business as,” also called a DBA, or a single-member LLC using your Social Security number for taxes (as opposed to an EIN), you have the option to add your business name to your Lili bank account. To add your business name, you’ll need to provide Lili with your tax return, business license or fictitious name registration.

Once your documentation has been reviewed and verified, you will be able to accept payments and check deposits under your business name.

Where the Lili bank account stands out

No fees: The Lili bank account has no monthly fees, no minimum balance requirements, no minimum opening deposit and unlimited fee-free transactions. With this account, you have access to free ACH transfers, free mobile check deposits, as well as free expense management tools.

In addition, Lili doesn’t charge for overdrafts, returned items or stop payments, incidental fees that are charged by both online and brick-and-mortar competitors. And, Lili does not charge a foreign exchange rate adjustment fee, meaning there’s no additional charge to make debit card purchases outside of the U.S.

ATM access and cash deposits: With your Lili business debit card, you can withdraw cash fee-free at over 32,000 MoneyPass ATMs. The Lili app offers a locator that allows you to find the closest ATM.

Although you can’t deposit cash at an ATM using your card, you can deposit cash at over 90,000 participating Green Dot locations through its At The Register service. Lili does not charge any fees for cash deposits, but the Green Dot retailer will charge a fee of up to $4.95 per deposit. In addition, you are limited to deposits of $1,000 in a 24-hour period and a maximum of $9,000 per month.

Integrated tools for expenses and taxes: Within the Lili app, you have access to tools that allow you to manage your expenses and plan for taxes. You can categorize your expenses simply by swiping, left for “life” or personal and right for “work” or business. Expense categories are pre-selected based on the merchant, but you can tap the transaction to edit the category if needed.

Lili also gives you the ability to add receipts to transactions, download annual and quarterly expense reports, and track spending insights in real time.

Additionally, Lili allows you to automatically set aside a predefined percentage of funds every time you get paid using the Tax Bucket feature. You can use the tax estimation tool to determine how much you should save. You can also manually add money to your Tax Bucket or remove money at any time.

And if you want to save for emergencies, you can open an Emergency Bucket, where you can set aside a fixed daily amount for an emergency fund.

Where the Lili bank account falls short

Low monthly limits for deposits and transfers: With the Lili bank account, you are limited to a maximum of $6,000 in mobile check deposits per month and a maximum of six checks per month. You won’t be able to access check deposits until your account has been open for 30 days, and you must receive or transfer at least $200 or more per month to be able to deposit checks.

In addition, for transferring money to a linked external account, you are limited to $500 per day, with a maximum of $1,000 per month. Although you also have the option to connect your Lili bank account to apps like PayPal, CashApp and Venmo, these are pretty restrictive limits for sending and receiving funds compared to competitors.

As an example, with Novo business checking you can deposit up to $40,000 in mobile check deposits per month and only limits external ACH transfers to $5,000 per payment.

Mobile only: Other than the initial application, Lili does not offer any web access to the bank account, which may be a drawback if you prefer to use a laptop or desktop to manage your finances. It’s also worth noting that according to a survey conducted by accounting firm PricewaterhouseCoopers, although 27% of small-business owners have shifted toward digital banking since the onset of COVID-19, 6% have shifted toward branch banking, which may make a mobile-only account a barrier to entry.

Can’t use an EIN to apply: To apply for a Lili bank account, you only need basic personal information, including your Social Security number. You cannot, however, sign up for an account using an employer identification number.

Although small businesses using their Social Security numbers for tax purposes can add their business names to their accounts after applying, these businesses cannot establish a financial footprint using an EIN with this bank account.

Limited business-related features: While the Lili bank account is designed for freelancers and contractors, it lacks business-related features that competitors offer. Lili does not offer checkbooks, cannot send or receive wires, cannot accommodate joint accounts and does not allow multiple business debit cards.

Additionally, this account doesn’t include invoicing tools — a particularly useful feature for many self-employed business owners — or integrations with third-party business tools like accounting software, ecommerce platforms or point-of-sale systems.

Compare Lili to business checking account alternatives

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