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6 Questions Every Small Business Owner Should Ask Their Bank

Many owners of small businesses may be using a bank that’s not ideal for their needs. You may be using the bank where your personal accounts are, or one close to your business. But in fact, you need to shop for a small business bank like you’d shop for any other service – making sure that what they offer and services they provide will meet your needs. Here’s some tips on what to look for in a bank for your small business.

1. What services do they offer?

Talk to the bank about their potential services for small businesses. Some banks, for instance, offer payroll services or individual retirement accounts (IRAs) for employees of small businesses. Some may offer wire transfers, lines of credit, business credit cards, or remote deposit. Another thing to look for is if they have an attractive technology platform that provides convenience to you. Do they have an investment services department than can help you plan for the future of your business? Choose a bank that offers services you need. Take the time to think about services you might need in the future (over the next two years). Do they offer these?

2. Do they offer competitive products?

Do some comparison shopping on bank products. Do they offer products like lines of credit, equipment leasing, commercial real estate (CRE) loans, or mortgage loans? Not all banks do. It’s important that they have the best option available for your specific business and needs.

3. Do they offer SBA loans?

Loans from the U.S. Small Business Administration (SBA) are very advantageous to small business owners, offering lower interest rates and better terms. The SBA partners with banks who actually make these loans. But not all banks offer SBA loans. Check into their relationship with the SBA, especially if you are likely to be in the market for a loan within the next two years.

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4. Will you know your banker?

In a world where more and more goods and services are offered online, it’s still a good idea for a small businessperson to know their banker and be able to talk to them face to face. Why? Because they can provide customized, personal attention to you as a business owner. They also know your character and standing in the community – and that can help small business owners receive benefits and services that can help them build and run their business.

5. Do they know the local market?

Community and regional banks can simply be a better fit for small businesses because they know the local market. The loan officers and other bankers know the local economic picture. It can make them more flexible, and apt to suggest ways they can help. Many large banks use strict online algorithms in making loan decisions, for example, where credit scores and cash are make-or-break factors. A smaller community bank has local decision-making authority where they can use character and community standing more than an algorithm. It’s also to their advantage to help local small businesses – which, in turn, can work to your advantage!

6. Can they grow with you?

Many small businesses start very small, with one or two employees. But you may either want to grow or find growth occurring with success! It’s prudent to pick a bank that can grow with you. Look at the range of small business services they offer, for example. Even if you don’t need services such as CRE or equipment leasing now, you might in the future if you want to open new locations or manage your equipment costs differently.

CBC Bank: Your Small Business Partner

Finding the right small business bank is highly important to business success. At CBC, we’ve been in business with businesses for over 90 years. We offer a wide array of small business products and services and are happy to help your small business. Contact us today to discuss how we can help.

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