Which Type of Business Checking Account is Right for Your Company?
A lot rides on choosing the right business checking account. You want to make a smart decision to ensure your firm’s continued success. With so many choices available, the process can get overwhelming. Here is a list of steps to keep in mind as you review your options.
Determine Your Needs
Before looking at potential banks, familiarize yourself with your business needs and goals. If you are a sole proprietor with few monthly transactions, a basic checking account will work. If you are a larger operation (or hope to become one) know what services you require — from ATM access to specialist consultations. The big question: Will you need a loan? If so, be prepared to discuss your monetary history and business plan in detail.
Secure Basic Services
Pretty much every account will have certain features: checking and savings options, credit and debit cards, checks, online banking and so on. What if an account doesn’t have those features? Skip it. Ensure the account you want covers the basics, and then ask about additional goodies like rewards and discounts.
Consider Your Cash Flow
What are your current funds? How do you plan to use them? How will they grow? Banks want to work with entrepreneurs with proven investments in their ventures. An attractive business profile may lead to special account offers to entice you to join the bank. Plus, if you are already dealing with a great deal of money, it affects the type of account you need. Again, basic checking won’t cut it for huge sums.
Beware the Fees
Though many basic accounts are advertised as free, many may in fact carry fees. Monthly maintenance charges are common. Luckily, you can usually get this waived by maintaining a minimum balance. Some accounts also have fees for exceeding transaction limits, so be sure to discuss that with a bank official up front. You don’t want to be saddled with unexpected costs.
Small Banks, Small Business: A Perfect Pair
Most new businesses are local and have few employees. If that describes you, stick to community banks. They focus on serving specific regions and prize relationships with small businesses. They are likely to offer you loans and expert knowledge on the market.
Talk with your area bankers to figure out where you feel most comfortable and who can best meet your needs. You want low fees, high attention to detail and a nice array of loan options. You will likely partner with your bank for years to come, so make sure you get a flexible account.