Shopping for a small business bank can be a confusing experience. First-time business owners, especially, can have difficulty anticipating the small business banking services their business will need. We often have new small business owners coming in without a strong understanding of what services they need their community bank to provide, and what small business banking services they’re likely to need as they grow.
The problem is that the services that a small business needs aren’t the same services that many consumers use. So while someone shopping for a consumer bank might be swayed by how close a bank is to their home, or how convenient their hours, they probably aren’t thinking about what kind of payroll or ACH services the bank offers.
To help our small business customers, we’ve put together a list of five small business banking services you should always look for when choosing a small business bank.
ACH, or Automated Clearing House, is the vast electronic network overseen by the National Automated Clearing House Association and the Federal Reserve that allows banks to quickly and easily send money directly between accounts. So in movies, when the wealthy protagonist says “I’ll have my banker send you the money,” he really means that the bank will use ACH to transfer money from his account to the account of the man he just bought an island from. In more mundane transactions, ACH is used for everything from automating bill-pay to depositing money directly into employee accounts for direct deposit payroll. All banks have access to the ACH system, however not all banks make it easy or affordable to use. Check to make sure your small business bank offers this small business banking service and doesn’t charge hefty fees for its use.
Payroll can be one of the most confusing aspects of running a small business. Between the various taxes and fees you have to keep track of, the reporting requirements, and actually making sure that paychecks get printed on time and sent out, the whole process can be a giant hassle. Many banks specializing in small business banking services can make the process easier by providing payroll services, through a third party. These services include calculating and setting aside all the proper taxes, keeping track of employee information, printing and sending out checks, and reporting. Not all banks offer payroll services, however, and you should check with your bank before using them for your small business.
Most banks now offer online banking for consumer accounts. Not all banks, however, offer online banking for business customers, and that can cost you time and money. Check with your bank to make sure that their business accounts are accessible online, and that you can perform common functions like checking your balance, transferring money, paying bills, and depositing checks from your computer. The time you save by being able to bank online will be well worth the more thorough investigation.
Whether you use Quickbooks(link to article about benefits of quickbooks) or another accounting software product, make sure that your business bank supports accounting software integration. Being able to pull in banking information to reconcile inside the software can be a powerful way to monitor the health of your growing business and make plans for the future. Not being able to integrate the software directly with the bank, however, means that information has to be input manually. This costs you time, and can lead to human errors that throw off all of your careful calculations.