Choosing the right bank for your business is important, since you’ll be dealing with it for as long as you run your business. It’s a pain to change banks, so make sure you get the right one.
Your bank should be one you are comfortable with and trust, but there’s a lot more to choosing the perfect bank for your business than just liking the people in it. You will need to consider the needs of your business and evaluate exactly what a financial institution can offer you before making a decision.
There are a number of banks to choose from, so take the time to do a little research and ensure that your choose the best one for your needs.
Preferably, you’ll want a bank that has plenty of experience in dealing with business, so stay away from the brand new ones and look at the older, more established financial institutions. Many of them will have special programs and accounts just for businesses
Fees and Rates
One of the more important things to consider is how much you’ll pay for your bank account. Check to find out what the fees are for different accounts at various banks to get a good idea of what is available. Some common fees include:
- Monthly transactions
- Account inquiries
- Maintenance fees
You need to know exactly what you will be charged for, but keep in mind that sometimes it’s cheaper to pay individual fees rather than a monthly amount, depending on the number of transactions you’ll be handling. For example, if you are charged fifty cents for every withdrawal at one bank and another offers unlimited withdrawals for $10 a month, you would choose the one that suits your withdrawal number best.
What can each bank offer your business? Some banks offer extras like a financial advisor who can help you make important financial decisions in an informed manner. If you already have a financial advisor, this is a moot point, but it can be handy if you don’t.
Some institutions also offer tracking of financial issues in your area of expertise. While not all banks provide this type of information, it can be helpful when running a business and is something that should be considered.
Ask what else each bank has to offer for a small business. They should be able to point you to their best resources.
Online banking capabilities are also a good idea, making it far simpler to handle paydays and invoices. Most banks offer this option now, so you probably won’t be forced to choose between one that has it and one that doesn’t, but it’s a good resource to have.
While you might just need a small checking account right now, where will your business be in ten years? You will probably want to avoid changing banks in the future, if possible, so take the time to pick one that will serve your needs over a long period of time. This means being able to expand into multiple accounts, if necessary. You may also want to check for other business related services to make sure they offer everything an expanding business could require.
Future needs may include:
- Merchant account
- Business loans
- Credit cards
- Multiple accounts
- Investment opportunities
Some banks are very focused and work to help a specific industry. For example, some banks cater to the real estate industry, offering unique insights and tips for those involved in real estate, providing home loans and mortgages, etc. Others will focus on eco-business, restaurants or another very specific industry.
If you can find a bank that is focused on your specific industry, you’ll find it has the tools to help you become successful. You’ll have access to loans tailored to your type of business, financial advice for your industry and several other resources that could help you toward financial success if you make use of them. While a bank can’t determine your success, it can definitely help you get things straightened out in the financial department.
More Banking Tips
If you will be looking for loans, focus on banks that offers small business loans on a regular basis. They will be more open to your needs and can be easier to work with. The same goes for choosing a financial institution if you need a merchant account or line of credit. Take a minute to write down exactly what you need . . . both at the moment and what you will need in the future. This should help you make a good choice about a bank.
Another good idea is to talk to other entrepreneurs who can share their experiences with you. As fellow business owners, their experience can be very valuable and help you stick to the right bank or avoid ones that could be potentially bad for business.