As a small business owner, having a killer business idea is only half of the battle. Having the right business infrastructure in place before you launch is also crucial for success. This means, first and foremost, having the right financial architecture that allows your business to operate securely, legally, and conveniently for yourself and your customers.
All of this starts with small business banking. The banking choices you make for your business will have a major impact on your bottom line and your ability to effectively serve your customers. With that in mind, we have the right banking tips for you. Read on for essential banking advice for small business owners in 2021.
1. Always Separate Business from Personal
Let’s kick off this small business banking guide with the number one golden rule: never use a personal bank account for business purposes. It is essential that you keep your business finances in a dedicated business account. This will help you get a clear idea of your business’s financial health, your tax obligations, and ensure that your business finances are legally compliant. A dedicated business account for all business financial activity is the one essential bit of banking advice for small businesses we can over.
2. Get an Honest Idea of Pricing
Another one of the most important small business banking tips to remember is to consider pricing. Many major banks offer business checking that is ostensibly “free” but will end up eating into your profits anyway as a result of hidden fees. Always choose a company that you know is 100% upfront and honest about pricing and will offer you a competitive rate.
For example, the major digital provider Hatch offers fully fee free business checking for all customers and offers a huge number of enticements and freebies for business account owners.
3. Don’t Forget Your Financing
Your business bank account is more than just a place to manage your income and payments. It is also a source of financing when you need it. Any decent business banking service should be able to offer lines of credit, term loans, and even invoice factoring to small business account holders. If a bank you are considering does not offer the standard small business credit financing that all businesses depend on from time-to-time, look elsewhere.
4. Choose a Bank That Makes Your Life Easier
In the age of digital finance, it is no longer enough for a business bank to simply provide bare-bones services. Many of the most competitive banking providers offer a range of innovations designed to make life easier for entrepreneurs and customers.
For example, a good business bank should offer a comprehensive online Bill Pay service to allow you to easily manage payments to third parties and vendors. They should offer online expense tracking, financial guidance, and physical debit cards as a bare minimum in the service price. Do not settle for less when it comes to banking tips for small business owners.
Innovative Banking Tips and More
For more banking tips that will help you future proof your finances in 2021, we have got you covered. Make sure to consult our expertly-curated Technology pages for all of the latest expert advice on the tech that matters.