Choosing a Bank for your Small Business Needs

It may seem like a simple task, but choosing a bank for your business needs is one of the most important decisions you will make early in your development. Here are some of the things you should consider:

Do you want to use a smaller, community based bank (my recommendation) or one of the well known national banks?

What products and services does the bank offer? It must offer checking, debit card, credit card and business advice services.

Is the bank conveniently located for deposits? You don't want to spend $10 for gas just to be able to deposit those hard-earned checks that you've received.

Are there convenient ATMs nearby for your petty cash needs? Also be certain to check the fee assessed for ATM transactions.

Can you do everything you need to do online? You'll want to be able to monitor all deposits, pay your credit card bill, have easily processed automatic payments for your recurring bills, etc.

Are they willing to work with small and growing businesses, or is their focus primarily on their largest accounts?

Aside: This web site offers information and services for new online businesses and existing businesses who want to establish an online presence.  Check us out!

Talk to other business owners. Find out what banks they use. Ask them for their assessments. What kinds of banking services or financial advice have they sought, and have they been satisfied with the results? Don't be shy. You don't need to ask them, for example, how large a loan they were able to secure!

I made a huge mistake when I was first starting my business. I chose the same bank that held most of my personal checking and savings accounts. They cared nothing about my start-up business. They had business clients that, at the time, were hundreds of time larger than my business. Procrastination makes changing banks unlikely, since it means contacting all of the businesses who receive their payments through direct transfer from the business's checking account plus all of the various income sources (affiliate accounts, merchant accounts, advertisers, etc.) who make payments to me by directly depositing the funds into my checking.

I wish I had known then...