Choosing a Bank
Choosing a bank is one of the many tasks any new entrepreneur faces. Opening a bank as a business isn’t quite the same as opening a personal account. There are a lot of services to consider and a lot of other factors to take into account as well.
Advantages of Larger Banks
Larger banks like J.P. Morgan Chase or HSBC or Bank of America are ubiquitous names in the world of finance. Banks of this caliber are powerhouses in what they do and can handle everything from the individual free-lancer to the multi-billion dollar blue chip company. Choosing a larger bank can have a ton of advantages:
Unexpected rate changes are almost always lower for larger institutions (like Chase) than smaller community banks because their size allows them to absorb much of the market uncertainty
Larger banks typically have a host of additional services that can be useful to your business such as integrated payment processing, fraud protection, and powerful mobile banking applications
A larger name typically means more branches and a consistency of service no matter where in the country (or world) your business takes you
Larger banks also have a tremendously large amount of lending power as compared to a smaller bank and will be able to scale alongside you without any issues
Advantages of Smaller Banks
Smaller banks like your local credit unions also offer their own suite of advantages over the larger banks. This can be your town or state owned credit union or another small private bank. Smaller banks can be beneficial to your business in a number of ways:
Smaller banks and credit unions can have better (but more variable) rates
The service and genuinely personal “customer orientation” of a small bank will almost always exceed that of a larger institution – chances are you’ll get to know many of the bankers in a small institution
As you move through the process of starting and running a business, the financial aspects can often feel confusing. There are several banking options that can help streamline the process. Here are a few of the many service options you have as you choose a bank.
Deposit products: Depending on the structure of your business and your banking needs, these can be simple cash management accounts or high-tech suites of products that serve multiple lines and structures.
Business Credit Cards: This is a credit card designed specifically for the needs of your business. It can help you establish your business’s credit profile and give you access to greater capital down the line.
Payment processing services: If your business plans to accept payments, this service allows you to set up a processing system that speed up the process. Chase and WeWork recently partnered to offer WeWork members the lowest rates on Payment Processing.
Digital and online banking: Banks today have mobile apps designed for business users that allow them to manage their money with great accessibility and flexibility.