Opening your business bank account is one of the first steps that you’ll take to making a reality out of your entrepreneurship dreams and ideas. With so many high street, private, and business-oriented banks to choose from, finding the right one for your new venture could feel like looking for a needle in a haystack. If your next step is to set up a bank account for your business, read these top tips before shopping around.
Tip #1. Know Your Current Needs:
Firstly, make a list of everything that your business currently requires from a bank. For the moment, this could be something as simple as somewhere secure to store your capital. Not sure what you need? At the very least, your bank should offer secure, easy-to-access accounts, with a good knowledge and experience level with business banking.
Tip #2. Determine Potential Future Needs:
As with anything in business, every decision that you make about your banking service should also be made with your future needs in mind. Hopefully, the bank that you choose for your business account will be the one that you stick with even as your business grows and expands in the future. For example, consider any future borrowing – will you be thinking of taking out a business loan at any point? If so, it’s good to choose a knowledgeable, smaller community bank that’s experienced with business customers and build a good relationship with them beforehand. Will you need to be able to pay employees or freelancers quickly in the future? Open an account with a bank that allows for faster payments and quick online access.
Tip #3. Consider the Size:
When it comes to choosing a business bank, size is a factor that matters. Today, the big, high street banking brands tend to be more geared towards personal customers, with many limiting the amount of credit they hand out to entrepreneurs like you. In the current small business world, there’s been a huge movement towards smaller, community banks. 2009 research showed that smaller banks are more likely to provide business loans than their larger competitors, and they account for over half of all small business lending despite the fact they only control a mere 22% of all bank assets. This trend has continued to grow, so a small bank is the best bank for today’s start-ups.
Tip #4. Remember Re-evaluation:
Whilst many business banking customers have a good relationship with their banks and continue to get the best for their money over many years, it’s important to be consistent and regular when re-evaluating your company’s financial needs. Every few years, review your business’ financial needs to ensure that your bank is still meeting expectations. If your business needs change, you should make your bank aware of any updates, as many will be happy to work alongside you to ensure that evolving financial requirements are met. If this is not possible, you should never be closed to the option of moving to a different bank.
Choosing the right bank account will ensure that your small business has strong financial support behind it at every stage.