What to consider when choosing a bank as a small business owner

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A business-oriented bank will provide needed services quickly and never be more than a phone call away. – Joe Kennedy in THE SMALL BUSINESS OWNER’S MANUAL:  Everything You Need to Know to Start Up and Run Your Business

In the world of business, money is everything. So when it comes to the issues of handling money, all the soberness is essential. This is a decision that can never be taken lightly. No. Not if the business is to prosper in any way.

Take for instance, funders. What do they want if they are interested in funding a business venture? They want a business that has got a fully functional accounting system. This is because, whenever the issues of finances pop up no one wants to be defrauded.

Part of the systems of managing business money is using a bank. But no one ever gives the idea of having a bank account much thought. People just assume all it takes is just have a bank account but, perhaps it isn’t a very smart idea not to rethink the choice of a bank.

“Within the industry, banks may specialize in retail (consumer-oriented) banking, commercial lending, real estate, and other areas, so first look for a bank that specializes in working with small businesses. You will know this quickly if a bank officer is assigned as your personal representative and asks detailed questions about the business, so that the appropriate bank products may be discussed. Listen carefully because not all banks offer all products to all businesses”. – Joe Kennedy

So, it becomes apparent that some work does happen in the choice of the bank. Below are some of the things to be taken into account by small business owners.

Joe Kennedy emphasizes that, “Most small business owners just look at the fees structure when considering a bank, but this should not make a difference. Instead, weigh the following factors when deciding which bank will best meet your needs”:

  • Convenience. This is actually a huge factor because time is so valuable. The bank that is within walking distance trumps a similar bank located across town.
  • Relationships. This intangible factor can mean a lot. Sometimes, small business owners and bankers feel good about each other, and sometimes they don’t.
  • Line of Credit (LOC) Needed? Many small businesses need cash from time to time, and most business-oriented banks offer this in the form of a revolving line of credit.

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Teboho is a Social Worker, Writer and Inspirational Speaker. He is in pursuit of MSc. in Managerial Psychology. Graduates are able to apply psychological principles and methods to tackle challenges in the work environment and provide effective practical solutions. Acting as industrial-organizational psychologists.