How To Pick The Best Bank For Your Small Business
Picking the best bank for your small business is oddly one of the most important decisions you’d have to make at its inception. When new entrepreneurs set out to start a business, they figure, “oh well, we can just walk into any bank. After all, isn’t it all about just saving our money?”.
Banks will save your money, yes. But how many will add true value to your business? The benefits of picking the best bank surpasses just savings, but also how the bank affects your business processes and growth.
In Nigeria for instance, many banks can be a real pain in the butt. This makes a lot of business owners and regular individuals to frequently close or ignore their bank accounts to move on to other probably more efficient banks.
Understanding the general ups and downs of the banking sector and its potential impact on your company will help any new or existing entrepreneur pick the best bank for his/her small business.
That said, here are 5 things to consider to help you choose the best bank for your business:
1). The Size Of The Bank:
How large is the bank? How long have they been around? Were they saved by an emergency investment? Or have they been recently acquired or involved in a merger?
The size of a bank speaks volume to how reputable it might be. It’s a terrible occurrence to have a bank liquidate when you have a lot of money saved in its coffers.
Before you pick a bank for your small business, first ensure you’re familiar with the bank’s size—number of branches, staff strength, market cap, and more—because the larger the bank, the lesser the chances of them closing shop anytime soon.
2). How They Deal With Customer Issues:
What do people say about their experiences with the bank’s customer care agents? Does the bank go all out on its way to ensure every customer is satisfied? Do they treat customer complaints right and on time?
The customer service agents at some banks are usually stone-faced. They don’t smile or say anything nice to the customer in front of them. The term, “the customer is always right”, means nothing to them. And because of this sect, people leave most banks even angrier than they arrived.
The customer service relations of banks may defer per bank and per country. But in Nigeria, bad customer service is the other of the day. A few banks have managed to make theirs better than others, but it’s important you only bank with an institution that truly cares about the way you feel, and doesn’t treat you like a stranger.
3). Their Value Added Services:
Are their fees low? How easily can you get credit facilities? What about business loans?
These must be on the list of concerns for business owners when opening a bank account. As a small business, you’d want a bank that charges low transaction fees, and would also be able to provide you with business loans, hassle-free, when you eventually need it.
Do your research on their credit history. Ask other entrepreneurs who use them to find out if they’ve ever been able to secure a loan from the bank. If you’re into procurement and supplies, ask the bank if they provide invoice discounting options, LPO finances, and even asset finances for some types of businesses. If they only do that to a select few, and even turn down some businesses who have a good cash flow running through their bank accounts, then you may be better off with another bank that cares more about helping businesses grow.
With a list of services you want to benefit from a bank, it’s always safer to go for the right match and not an immediate option, so you can probably feel a lot safer.
4). How Close Is A Branch To Your Business Location:
If the nearest bank’s brach to your office location is over a mile away, you’re better off making slight compromises with the next-best bank closer to you.
Irrespective of the amazing advantages that a distant bank poses, you’d need to be able to make quick stops into the bank on a weekly, and sometimes daily basis for deposits, and other transactions. Using a distant bank in this situation wouldn’t be the best course of action.
A scenario where a distant bank could work, is if you want the most secure and reputable place to save money and also have easy access to bank finance.
5). How Easily Can You Bank With Them On The Weekends?
Are their debit cards reliable? Are you certain every time you make a trip to the ATM (Automated Teller Machine), the cards issued to you would always respond as long as there’s money in the account? Do they have ATM’s that you could probably deposit cash through on the weekends? Also, how good is their internet banking platform? Do you get bounced off repeatedly due to platform issues?
When the bank is closed for the day or the weekend, it’s important that you can still transact with it in some way. A bank that keeps you waiting till the next business day, is probably not a good place to open your most important business account.
What are your thoughts on these 5 things to consider to help you choose the best bank for your business? Let me know by leaving a comment below.