What to Look for in a Business Banking Account
When you choose a bank for your business needs remember you are picking not only a place to keep your checking and your business savings accounts but also a place where many other services are available that you may need some day. Spending a little more time in your choice may help you avoid changing institutions when your business grows. Many business owners spend much more time picking out the carpeting than their bank.
Here are a few things you need to keep in mind when you are looking for a new bank.
1. Smaller Banks
Smaller banks or regional banks many offer better services to you because they understand the local economy and how it effects their customers. If you prefer or need more face to face interaction this is the way you should go. Because they want your business more than large banks, you may find free business banking is available.
2. Rates and Fees
Because larger financial institutions carry more weight in financial markets they may be able to provide services at a more competitive rate than smaller banks. Larger banks may be able to offer credit cards and loans at more favorable rates to get your business.
3. Lending Authority
All banks are trying to be more caring for the business customer during this difficult economic time. They are trying to offer better customer service to their clients. But still larger banks can’t help that most customers are still just a number. It is very hard to place themselves on your main street when they are in their corporate offices running many thousands of bank branches.
Here is where smaller banks can do a better job. While larger banks have the means to offer larger services, they mainly want to offer them to larger entities. Smaller banks can only compete in smaller businesses so that where they do a better job. You will find local banks have greater authority to lend money at a local level. You will be turned down for loans by larger banks while smaller ones may approve you.
4. Small Business Administration Integration
Does your bank work well with the U.S. Small Business Administration (SBA) loan system? These loans, which are federally subsidized, help protect the bank against default. SBA loans offer more flexible repayment terms, so a bank working with them allows them to accept riskier borrowers.
Here’s your checklist of things to look for in searching for a bank:
Primary Services
• Business Checking account
• Savings account
• Credit card processing
• Employee priority services
• Internet banking
Loan Services
• Business line-of-credit
• Better rate loans
• Equipment finance and leasing services
• Small Business Association loans
Money Management
• International cash transfers
• Lockboxdiscounts
• Credit card services
Other Services
• Business payroll processing
• IRA/ROTH accounts
• Discount insurance service
Lastly, be sure to get all your fees in writing and ask if your bank has any bundled services to help you save money on the fees.
Look at your bank as a long term relationship. Find a bank that meets your needs for business and for a personal relationship. Many new startup companies only look to basic services and needs because of the time constraints of starting their business. It’s a mistake not to make a full effort in this vital part of your business.
Establishing a good relationship with your banker is imperative if you want your business to grow. The time you spend now picking the right one will allow you to reap benefits for the long run.
