What Business Banking Products Does Your Company Need?

As a small business, one of the first and fundamental financial choices you make is your bank. Where you process the funds you spend and earn in the operation of your business is a critical decision to make - and reevaluate - from time to time. It’s important to know that you have the appropriate products to suit your needs at any given time.

The fact is, every business is different from every other. The key is cutting through the multitude of business banking products offered in search of the products that best suit your business’ particular needs. When it comes to business banking products, finding the right products for your business is more important than having a plethora of products offered to you.

How do you determine your needs and choose wisely among a bank’s business products? Basically, look for the products that will be of most benefit to your business and the way you run it. To help you avoid being overwhelmed, let’s discuss some of the choices with which you’ll be confronted and criteria you can use to assess your needs for them:

Lines of Credit - Does your business need one or would it simply provide a comfortable buffer for those, “just in case,” scenarios? If you’re going to rely on these funds to start up, expand or run your business through a lean time, look for the lowest interest rate you can find. If it’s more of a luxury than a necessity, this is not where you should worry about a higher interest rate.

Loans and Credit Cards - It’s great to have a banker in your corner when you’re looking for a loan but don’t put all your eggs in his or her basket. If you have time to wait for a loan to be processed, you’ll have affordable funds at your disposal; remember, however, loans take time to process. If you’re in need of quick money to, say, take advantage of an opportunity, another, potentially more pricey source of financing - like a cash advance on a credit card - may better suit your needs. Just make sure you pay it off ASAP. Do have flexibility in your financing options that will meet a variety of situations you may encounter.

Credit Card Business Rewards - Seek a card with rewards from which your business will benefit. After all, if you don’t travel for business, what’s the benefit of racking up points for air miles? Look for rewards you will use, like cash back on purchases for your business. In order to get a beneficial rewards program, you may have to settle for a card with a higher interest rate. That’s fine so long as you use care to accrue the rewards - not debt on that card.

Business Checking - This is an area where lots of money can be saved - or wasted. Measure fees against your needs. If you deposit or write a lot of checks, make certain that the number and/or frequency of your transactions won’t cause you to incur fees. If you conduct most of your financial transactions online and write and/or process checks only occasionally, checking fees should matter less to you. If you’ve had the same checking account for your business for a while, consider if your checking transactions have significantly changed as electronic banking has boomed.

Other Banking Products - These can include financial services like Payroll, Investment or Merchant Services. While they all seem useful and beneficial to business in a general sense, consider their value to your particular company. Is your organization big enough to require these types of services - or can you handle paying employees, establishing retirement accounts and 401(k)s and processing payments in-house? If you can accomplish these tasks yourself, then these services, while certainly attractive offerings to some, don’t represent a selling feature to you.

Whether your business is new or established, your banking products can make running the financial life of your business easier and more profitable. Remember to regularly reevaluate your business’ banking needs to make certain you’re getting precisely what you need for the way you run your business today.

Business banking products are meant to appeal to a wide array of businesses and fill a multitude of needs. Don’t be impressed by a long list of banking products and offerings because the fact is, your business probably needs only a handful. The best that you can do is determine what products are most useful to you and focus on getting the greatest benefit from those.

What banking products provide your business the greatest benefit?