Did you know there are over 30.2 million small businesses in the United States?
For small businesses to succeed, they need to consider every decision they make, and choosing the right business account is no exception. If you’re considering switching to a business account, you came to the right place.
Read on to learn about these banking tips for your small business.
1. The Size of the Bank Matters
When you have a business, finding the bank that will defend your interests is essential. Although it’s tempting to choose a large bank, bigger banks aren’t always the best move for you.
Before choosing the right bank for your business, you need to evaluate your future financial goals. The current needs of your business matter and evaluate where you plan to take it in a few years.
Will a small bank be able to provide you with the services you need? Small banks might not have ATMs in every corner, but they have more ties with the local market.
Large banks, on the other hand, have more branches, resources, and services.
Before you decide whether you want to bank with a small or large bank, it’s essential you learn what they both have to offer.
2. Stay on Top of Your Credit
Some banks have the luxury of picking which clients they will work with. If your credit score is too low, a large bank might not want to do business with you.
However, if your business is new or you have a low credit score, a small bank might be more likely to do business with you.
Before you start looking for banks for your business, learn what your credit score is and the credit requirements of each back.
3. Beware of Free Business Accounts
Although it might be tempting to settle for a bank that offers a free business account, these might carry other fees. While you can save hundreds of dollars a year on monthly fees by choosing a free savings account, you should read the small print.
Some banks might have hidden fees on their free savings account by implementing a transaction, ATM, or deposit fees.
Make sure you compare banks to find the business account with the lowest fees for you.
4. Internet Banks
With the rise of internet banks, more and more business owners have started gravitating towards online banking.
Whether or not you choose an internet bank for your business might depend on your business stage. If your business is starting out, you might only need basic banking services, which an online bank might be able to fulfill.
However, if you have a larger business, you might physically need to attend personal meetings at the bank and build relationships.
5. Location of the Bank
As a business owner, you need to focus all of your attention on growing the business. The last thing you want is to spend a lot of time driving to the bank.
For example, if your business depends on you making daily or weekly deposits, you want a bank nearby. Also, if you have to travel often on business, you will likely need a bank with multiple branches.
Before you settle on a bank for your small business, you need to keep the location in mind. Based on your business’s nature, you may or may not need to make frequent trips to the bank.
6. Re-Think Your Current Bank
Although your current bank might be great for your personal saving and checking accounts, it might not be able to fulfill your business needs.
It’s okay to continue banking with your current back for your personal affairs. However, when it comes to business banking, it’s essential you explore your options.
Figure out if your bank will offer the right services, reasonable fees, and even access to a credit line.
For example, you might need to open a joint business banking account with your business partner, so you must your current bank offers it. Ensure you talk to your bank if you need more info.
You might be able to find a business account in another bank that has lower fees, and best fit your business’s needs.
7. Building Relationships Is Important
Small business owners learn fast that they need to build relationships to grow their businesses.
Building relationships with a bank is as important as building relationships with clients. When you build a relationship with a banker, you will get expert advice on building your credibility with a bank.
Although it might seem that banks only care about numbers, they are also run by people who approve or deny loans. If and when you need a business loan, you would have already established a good relationship with the bank.
8. Digital Needs
As a small business, you might depend a lot on technology, or you might not. Before you pick the right bank for your business, consider your digital needs.
For example, if you travel a lot for work, you might need to choose a bank that has a large digital platform. Making deposits, transfers, and general banking using your cellphone might be a necessary requirement.
On the other hand, your business might not be as tech-centric, so you might not need a bank that offers a lot of digital services.
9. SBA and Banking
If you’re a small business owner, you might need an SBA loan. When you decide to go this route, it’s a good idea to choose a bank that has ties with the SBA.
Start by talking to your SBA lender about the best banking options. You should consider SBA guaranteed loans for your business financing because SBA Government-Backed Loans are very versatile and can be used for almost any business purpose. And, because of the government guarantee that comes with these loans, interest rates are very favorable.
10. Go With Your Gut
At the end of the day, most business bank accounts will offer similar and competitive services. However, you need to choose the bank you feel the most comfortable with.
Once you have compared all banking options, you need to trust your gut.
Follow These Banking Tips for Your Small Business
Now that you know about these simple banking tips for your small business, you can find your business’s right bank.
Start by considering the bank’s size, stay on top of your credit, consider the location, and build relationships.
If you enjoyed these financial tips and would like to learn more, check out the rest of our blog.