Financial management is necessary when owning and operating a small business. Many small business owners make the mistake of using their personal bank accounts to operate the business. You must establish a business bank account before you start your business.
Though one good bank can be enough for a small business, many financial experts recommend working with two banks. Remember that the bank is a service provider; therefore, you should compare all your service needs and use more than one bank if necessary to fulfill those needs.
While having one bank for your business can be enough, not having all your money or transactions at one banking institution can benefit your business in the long term. In some cases, having different accounts for certain transactions would even be recommended.
Having a company account and separating your account from the professional account, whether you are self-employed or have a small business, is essential. The accounts for companies or freelancers have several features as compared to those offered on personal accounts.
You must research or seek a financial expert’s advice when choosing the bank you utilize for your business accounts. There are many factors to consider when making such an important financial decision. Here are eight factors to consider when choosing your business banking institution.
Commissions and Fees
Although commissions and fees are usually charged for specific expenses, you must look for a bank where the commissions and fees are minimal or non-existent. Whether the banking institution charges for withdrawals, transfers, deposits, or minimum/maximum balances, you should consider whether.
Commissions and fees can add up quickly, making banking at certain institutions expensive. Most small or freelance businesses operate on a tight budget and need to cut costs wherever possible, including banking transactions.
Online Banking
Online banking usually has fewer expenses than traditional banking. Almost all large banks have a subsidiary that only works online. Be it an online or traditional bank, carrying out all kinds of operations over the internet is necessary to save time and from the same mobile or computer to control all the operations related to the business.
Your bank must have a good, simple, and secure web application. Carrying out operations is not only about making transfers and checking balances. There are other transactions done through your business banking institution. For example, you or your accountant can receive alerts that inform you of specific transactions, such as automatic deposits or payments.
Accessibility
Accessibility when it comes to business banking can refer to online transactions. However, it can also refer to bank locations in relationship to your business and ATM availability. Banking is such an essential aspect of the financial management of your business that you must consider accessibility when choosing your business banking institution.
Financial Advisor
If you can’t hire a full-time financial advisor or accountant, you may need access to one through your banking institution. Many financial institutions have financial advisors available to their customers.
These advisors can help you choose what accounts you need, manage the accounts, and make investments. They can also recommend other financial products and services to help you manage your business finances.
Interest Rates
It would help if you considered many factors when choosing your bank. Interest rates should be considered when selecting a bank. When it comes to business loans, you will want to choose a bank that offers lower interest rates on their loans and other forms of credit. If you will use your bank to grow revenue, you also want to consider how much interest the bank offers on their accounts.
Room to Grow
When considering a bank for your small business, you have to think big. While your business may be small now, most business owners want to grow. In the digital age, businesses have been known to explode overnight. It would help to choose a bank that will give you room to grow.
Some banks have a maximum balance or deposit; therefore, they may not suit your growing business. Use your business plan financial projections to understand your financial potential and apply that information to your banking decisions.
Customer Service
When running a business and banking, chances are you will need customer service at some point. It would help if you chose a bank that has excellent customer service. You need to be assured your issues and banking needs are handled by professionals who understand your needs.
Products and Services
Businesses must assess the products banks offer and the price of those products. You want to look for a bank that offers business banking services that meet your needs. These could include commission-free transfers abroad, travel assistance, account overdrafts, promissory notes, factoring, advances, insurance, and point-of-sale terminals (POS). For example, a retirement plan is a good investment if you are self-employed. Not all banks offer all products.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
