For decades, small business owners have often faced an uncomfortable choice: keep operating cash readily accessible in business checking accounts earning an average of just 0.07% APY¹ or move funds into higher-yielding savings accounts that can complicate daily operations.
LiaFi has created a third solution which can help resolve that trade-off.
The Accessibility-Versus-Yield Dilemma
The numbers tell a familiar story. Business checking accounts offer immediate access for payroll and vendor payments but typically earn an average of just 0.07% APY. Savings accounts and money market accounts may offer better yields but often come with conditions such as introductory rates, minimum balances, and transaction limitations.
“Business owners weren’t making bad decisions by leaving cash in checking accounts,” says Bruce Hrovat, who spent 30 years in banking operations before founding LiaFi. “They were making a practical choice: keep the business running smoothly, even if it meant earning minimal returns on that cash.”
The result has often been substantial amounts of small business capital earning minimal returns on operating cash throughout the month.
How LiaFi Works
LiaFi’s platform is designed with the aim to fundamentally restructure how businesses approach surplus cash management. Businesses can maintain their primary transaction accounts exactly as they always have, same bank, same bill-pay systems, same vendor relationships. Nothing about day-to-day banking needs to change.
But between payment cycles, typically on the 15th and 30th of each month, when cash accumulates beyond immediate operational needs, businesses can allocate those idle funds to the LiaFi Business Deposit Account. Deposits are held at Magnolia Bank, Member FDIC, where funds earn 3.10% APY***.
“Most businesses keep more cash sitting around than they actually need for day-to-day operations,” Hrovat explains. “That extra money is an opportunity and should be put to work.”
Consider a typical pattern for small business cashflow: A business receives customer payments in the first half of the month, and cash accumulates in transaction accounts until payroll and vendor payments process mid-month. Then the cycle repeats. With LiaFi, that accumulated cash can earn 3.10% APY*** between payment cycles, then can be moved back to the operating transaction account when needed for transactions.
The Financial Impact
The financial impact can be meaningful: earning 3.10% APY*** on surplus cash instead of 0.07% in traditional transaction accounts can create additional interest for small businesses, interest that could help fund software subscriptions, marketing initiatives, professional development, or equipment upgrades.
“This isn’t about timing the market or taking risks,” Hrovat emphasizes. “It’s about earning a return on money you already have.”
Preserving Banking Relationships
One of LiaFi’s core design principles is preserving existing banking relationships rather than disrupting them. Switching primary banking relationships carries substantial operational cost: updating vendor payment information, reconfiguring accounting software, training staff on new systems.
LiaFi is designed to work alongside existing banking relationships. The primary transaction account remains at the business’s current bank, while LiaFi simply provides a destination for surplus cash between transaction cycles.
“We’re not asking businesses to choose between their current bank and better yields,” says Hrovat. “We’re giving them both.”
A Response to an Old Problem
When the Dodd-Frank Act repealed Regulation Q in 2011², it eliminated regulatory barriers to banks paying interest on business transaction accounts. Fourteen years later, the average business transaction account still pays 0.07% APY.
By unbundling yield optimization from transaction processing, LiaFi delivers what Regulation Q repeal theoretically enabled: businesses earning meaningful returns on operating cash without sacrificing accessibility.
An Additional Option
The choice between accessibility and yield has constrained small business cash management for over a decade. With LiaFi, businesses have the opportunity to maintain operational flexibility with their existing bank while earning 3.10% APY*** on surplus cash held at Magnolia Bank, Member FDIC.
For businesses with idle cash accumulating between payment cycles, LiaFi offers an approach designed to address what has been a persistent challenge in small business banking.
- ¹ Federal Deposit Insurance Corporation, National Rates and Rate Caps: Business Savings and Interest Checking Accounts, data as of Oct. 15, 2025
- ² Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, §627 (2010), repealing Regulation Q prohibition on interest-bearing business transaction accounts, effective July 21, 2011
- LiaFi Business Account is a variable rate account. The rate may change after the account is opened. Rates are subject to change at anytime.
- ** ACH transfers typically process within 1-2 business days. Transfer timing depends on the payment rail, bank cutoff times, and receiving institution processing. ACH transfers are subject to daily limits and ACHA Operating Rules.
- *** Annual Percentage Yield. LiaFi Business Account is a variable rate account. The rate may change after the account is opened. Rates are subject to change at any time. Rate current as of January 15, 2026.