Finding the right bank for your small business can be daunting – with so many institutions competing, owners rarely have time for the in-depth research required to weigh every option. This guide will help you narrow the field to find the best fit.
Small, medium or large?
You can eliminate a lot of contenders by first deciding whether you want a large national bank, a regional bank or a small local one. Weigh your priorities: larger institutions can offer lower day-to-day fees, longer hours and more advanced online banking, and options for international clients; regional and local banks tend to be more customer-friendly on lending, may charge lower interest on loans and lines of credit, and strive for more personalised service. When you talk to a bank, ask whether you’ll be assigned a small business adviser and how they can help your business succeed.
The cost of doing business
Once you know the kind of bank you want, compare fees for service. You’ll be offered sign-up perks and maybe a free account – read the fine print, as you may be charged per transaction or for banking in person versus online. Other fees can apply for not meeting a minimum balance, exceeding monthly withdrawal or deposit limits, or maintaining an inactive account.
When you need funds to grow
Think ahead to the day you’ll apply for a loan or line of credit to fund growth. Look into interest rates, the application process, qualification criteria and terms now. Knowing in advance what a lender looks for when approving business financing may be what makes or breaks your decision to sign on.
Final thoughts
Ask around your business network for insider views to help you choose a bank that meets your day-to-day needs, supports your growth, saves you money and keeps you a happy customer. The sign-up perks might be tempting, but it’s much more important to choose a bank that’s the right match for your goals both now and in the future.