The Ultimate Guide To Business Bank Statements

How to obtain the business bank statement, whom to send it to and not, and how to handle errors.

Business bank statements have existed for a long time, and one cannot overstate their importance. A business bank statement is a document that provides an overview of a company’s fiscal health by revealing its income, expenditure, and overall financial operations within a specific period. Ultimately, it empowers businesses to spot trends, make educated decisions and guide their organization toward success.Usually, they are sent monthly to the account holder to review and track income and expenses. While the business bank statement is crucial in financial management, it raises important questions on security, privacy, and manipulation. Therefore, you must be aware of practical solutions to such issues. Interestingly, this guide answers prominent questions regarding business bank statements while providing valuable insights about these documents.

Am I at Risk if Someone Has My Bank Statement?

The answer to this question is a firm yes! Bank statements are more than just paper trails listing income and expenses; they contain sensitive financial information. As a result, banks make it a top priority to issue business bank statements to the business account holder. It is noteworthy that financial institutions that issue business bank statements are bound by law to protect your information. Therefore, they maintain strict client confidentiality to prevent legal sanctions. Banks further add an extra layer of encryption to protect sensitive information in the bank statement. Thus, you’ll be prompted to input a secret code to access the document when you receive your bank statement. With the increasing rate of identity thefts, malicious individuals can retrieve account numbers or transaction details and use them for nefarious purposes. Therefore, financial institutions must encrypt sensitive information when issuing bank statements to account holders. In addition, rather than providing physical copies of tamper-prone bank statements, banks adopt secure online banking services and multi-factor authentication to enhance security. Thus, businesses can mitigate risk exposure by ensuring digital security and limiting access to bank statements.

Can Anyone See My Bank Statement Without My Permission?

On security concerns, business account holders should be aware of those who have authorized access to their bank statements. Since banks issue these statements, they have strict policies to protect their client’s privacy.Firstly, business bank statements are prepared by bank employees, legally bound to maintain client confidentiality and professional ethics. Since they carry sensitive information, not all employees have authorized access to prepare them. Thus, if there is a breach of access to your bank statement, your bank is liable for criminal charges.Also, business banks must show compliance with regulatory bodies in protecting their data. Regulatory bodies like General Data Protection Regulation (GDPR) ensure banks fully comply with securing businesses’ information. While regulatory bodies and banks will not share your bank statements, certain legal exceptions exist. They include account monitoring, legal compliance, and court subpoenas for specific transaction records relating to fraud.

How To Generate the Statement of a Closed Account

Certain situations can occur, which lead you to close your business account. As a result, you may have switched to a new business account and no longer require the old one. Whichever the case, it is possible to generate the statement of a closed account, albeit tricky. Remember, bank statements are issued at the end of a statement period, usually monthly. But how can you generate a statement of your closed business account?Your best and safest option is to contact the bank with which you opened the account. The bank’s customer service will guide you through the necessary procedures, verification, and documentation. Also, when generating these statements, charges may be incurred. So, inquire early on about any associated costs.It is important to note that banks can retain business records of a closed account even for many years. However, the duration varies depending on the bank; thus, acting promptly to generate your bank statement is beneficial.

Can You Remove Transactions From Your Bank Statement?

Think of transactions as footprints of your income and expenses. Once you send or receive payments to and from your business account, they become a permanent part of your financial history. Hence, you cannot remove transactions from your bank statement. In fact, it is illegal to do so, as bank statements are legal documents presented in court as subpoenas during civil suits. However, there are certain exceptions to removing transactions from your bank statement. A situation may arise where you’ll notice duplicity of transactions or errors in your bank statement. If that occurs, notify your bank promptly so they can carry out further investigations and rectify your transaction records.

Can You Verify Fake Bank Statements?

It is undeniable that bank statements carry a form of authenticity in displaying your transactions in a given period. However, due to the rise of malicious actors and cybercriminals, it is possible to create fake bank statements.If you are in the lending business, individuals representing an organization may present a bank statement to prove their eligibility. Although fake, the presented documents can appear real. Without proper verification, such a business becomes a party to fraud. Thus, spotting fake bank statements requires a keen eye for detail and a cautious approach. Manual scrutiny is often the first step in doing this effectively and requires a number of steps.

First, be on the lookout for inconsistencies or irregularities within the statement itself – from peculiar transactions to spelling mistakes or erratic fonts.
Businesses can cross-check the statement with other submitted documents to establish credibility, ensuring cohesive information.
Businesses can contact the bank listed on the bank statement for validation. Any mismatches with the bank’s records raise red flags and demand further investigation.
Also, ensure your business receives bank statements from the organization’s official email address.

Furthermore, businesses can employ specialized software, comparing suspicious statements to a comprehensive database of known fakes. Also, they can utilize Optical Character Recognition (OCR) technology to extract data from bank statements and verify them accurately.

Do Banks Make Mistakes on Statements?

Banks, like any other business, can make mistakes. One common reason for mistakes on bank statements is system updates or technical glitches. When banks update their software or systems, data discrepancies or misinterpretation are possible, leading to errors in the generated statements.Another reason is that banks are run by fallible individuals constantly learning and striving to improve their practices. Bank employees responsible for inputting transactions occasionally make mistakes such as data entry errors or accidental omissions. These human errors can result in incorrect information being reflected on the bank statements.However, it is important to note that while mistakes can happen, banks generally take responsibility for rectifying errors promptly. Banks have mechanisms in place to address customer concerns and discrepancies. Consequently, if you notice any discrepancies or errors on your bank statement, it is recommended to contact your bank’s customer service immediately to report the issue and request a correction.

Look at that! We’ve addressed burning questions about business bank statements while improving your understanding of them. Thus, it’s time to implement your newfound knowledge and the best practices highlighted in this guide to get your bank statements.The digital age has introduced convenience in managing financial records, but it creates specific challenges like creating fake bank statements. Therefore, it's imperative to join Narvi, a business account provider with seamless, secure, and transparent banking services. With Narvi, businesses can set up a bank account and create official bank statements to assess their fiscal health. Request a demo to join Narvi and generate your bank statements with ease.

Published October 3, 2023; updated November 25, 2024DisclaimerThis publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Narvi Payments Oy Ab or its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.AuthorNeil Ambikar, Co-Founder and CFO of Narvi