Best Bank for Small Business
What can you imagine about a small business? Of course, it is not selling small-sized goods, but the company's small operations. Something is interesting this time, which is about the development of small businesses and their relationship with banks. The question now is why this small business needs a bank and the best bank for small business that can help this business grow.
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It is undeniable, not always the business can run smoothly, even in smooth conditions and experiencing development, this small business still needs capital to meet the needs of merchandise to be sold or to prepare various needs in the development of the business.
Of course, there are many hopes for those of you who are already in this business field. It can be recognized that to be able to have a large business, you must start from a small business first, but it is not uncommon for businesses to be directly large, in certain cases, such as continuing a family business.
What is A Small Business?
There are many notions about this small business, some say that a small business is a business that has a workforce of less than 50 people.
But according to the Financial Accounting Standard Board (FASB) in a book written by Ahmed Riahi Balkaoui, states that a small business is a small company whose operations are relatively small, usually with total revenues of less than $ 5 million. (Balkaoui, 2000:50).
The characteristics of small companies according to the Financial Accounting Standard Board (FASB), among others:
- Managed by the owner himself.
- Have several other owners, if any.
- All owners are actively involved in running the affairs of the company, except perhaps certain family members.
- There is rarely a transfer of ownership rights.
- Has a simple capital structure
In general, a small business is an individual company and is usually owned by a sole proprietor, and the individual entrepreneur is the owner of an individual company.
In addition, in reality, a small business is a form of business entity established by individuals and managed independently by one person, and the capital used comes from one person only. Because it is only one person, it is this person who controls all business decisions, and of course, receives all the profits he generates and is responsible for all debts and obligations of his business.
This becomes more valuable and less valuable for small businesses, including individual companies.
Why Do Small Businesses Need Capital Help from Banks?
With the development of the times and more and more people who are interested in opening a business, this has a positive value on the economy so that it experiences development.
In the United States itself, small businesses are also increasingly popular, many people want to open a small business, in addition to the reason for the difficulty of finding a job, also for reasons of financial limitations.
For those of you who have skills, perseverance, and a strong strategy and also have the right and competitive target market, but have limitations in capital, then collaborating with banks can be an attractive choice.
It is undeniable that capital is one of the things that plays a role when there are no more financial funds to start a business or develop a small business that you have built. Capital loans can indeed be said to be very important to do, especially if you want to start a business.
You must have heard that some businesses do not require capital, but in fact in a business world that is growing and changing rapidly, capital even in small amounts, especially in a business, capital becomes a must.
Remember this simple saying:
You have to spend money to get money"
In business, even though it is only a small business, this is an absolute thing, the bigger the business, the greater the capital needed to develop the growing business.
There are various reasons why small businesses also need capital, especially from banks, including:
- The difficulty of finding funds.
- Business expansion
- To maintain cash flow.
- To maintain and add business equipment.
- Preparation for greater business development.
The Difficulty of Finding Funds
The main reason is the difficulty of finding funds from investors or capital owners. Working with a bank is one way to be able to prepare business capital.
Indeed, some consequences must be accepted by this small business person in applying for cooperation with banks. But all of that is well understood by these businessmen.
Business Expansion
The need for funds, especially when developing a business, most small business owners apply for capital loans to develop a business, the larger the business run, of course, the greater the capital needed.
Business expansion requires a lot of capital for various purposes, ranging from marketing, office preparation, new goods storage warehouses, renovations, and various other needs.
In this case, what happens is that the existing cash is not sufficient to make all the preparations above, in this case, of course, it is not allowed to use money or funds for operational purposes and also funds for expansion plans.
At this stage, these small business owners should start considering getting additional capital. Capital loans from banks will be a solution to help cover all costs needed without having to interfere with operational funds in the company's budget.
To Maintain Cash Flow
For small businesses, the main thing to do is maintain cash flow. Cash flow in small businesses can experience problems when things happen that cannot be predicted, such as when stock goods have not been sold, while various costs must be incurred immediately, such as the obligation to pay employee salaries, electricity bills, and various other obligations.
This is where the role of banking bridges the needs of small business owners, by providing funds to smooth cash flow.
To Maintain and Add Business Equipment
Capital is needed in all businesses, especially for small businesses. In a small business, of course, you need equipment that makes the business run normally and optimally. In addition to market demand, funds are also needed so that there are reserves for repair costs.
To maintain business operational turnover, capital loans from the best banks for small businesses are the right choice.
Greater Business Development Preparation
An emergency fund for business development? Why not? It seems like all businesses including small businesses should also prepare these funds.
Small businesses should prepare an emergency fund, either for larger business development or if something bad is feared to happen.
Best Bank For New Small Business
From the various reviews above, of course, the most important thing here is how to work appropriately with the best banks that you can work with, especially in getting capital for your small business.
Admittedly, dealing with administration is indeed very troublesome, one of which is opening a bank account. Separating records and finances between personal needs and business is troublesome.
However, make no mistake, separating your personal and small business finances, will be a successful step in building your business for the better.
Taking information from architecturaldigest.com, that setting up a small account for a business will make it easier for you to know bills, expenses, and consumer payments, this allows you to build a habit path in your small business, which is very important in applying for a small business loan or for applying for your business credit card. (A 2018 Nav survey found that 70% of small business owners without professional checking accounts are turned away by lenders.)
Looking at the various information above, you need information about the best bank for your small business, especially if your business is still new. In the United States alone there are more than 4000 commercial banks that offer a wide selection of business checking accounts.
For this reason, the best bank choices will be presented for small businesses with sole proprietors or beginners (architecturaldigest.com), including:
1. Wells Fargo Initiate Business Checking
It looks like this bank account could be an option for those of you who are just starting a business, as it allows up to 100 transactions per period with no fees and cash deposits of up to $5,000 per month.
This account sets a monthly fee of $10, but this fee can be avoided with a daily balance of $500.
With a minimum initial deposit of just $25, this solution is excellent for small businesses with limited cash flow activity.
The Starting Business Checking Account may be the simplest of Wells Fargo's offerings, but it still offers no-obligation debit card protection as well as fraud monitoring. And, as with all Wells Fargo business checking accounts, small business owners can apply online or in person, and then send the deposit and required documents later.
2. BlueVine Business
For you a small business owner, you can benefit a lot by opening a BlueVine business checking account.
BlueVine has unlimited transactions as well as no monthly service fees or minimum balance. What's more, account holders can access more than 37,000 MoneyPass ATMs at no additional cost. You'll have peace of mind knowing BlueVine doesn't charge overdraft fees.
Small business owners can also earn 2.0% interest, or 50 times the national average, with balances up to $100,000.
3. Comerica Basic Business Checking
Do you want to get convenience because of you as a small business owner? Comerica Basic Business Checking could be the answer to your needs, a small deposit of $50 can get you an interest-free account with no monthly maintenance fees or minimum balance requirements.
You can also waive your activity fees with deposits of up to $2,500 per month, or 75 transactions or less.
Comerica can synchronize with QuickBooks, making it possible to send digital payments or oversee your accounting.
4. Truist Simple Business Checking
For those of you whose financial transaction needs are not too much, then the Truist Simple Business Checking account can be a good choice.
With no monthly maintenance fees or minimum balance requirements, this small business bank account can be a great choice for entrepreneurs just starting. The account includes 50 transactions and $2,000 in cash processing per month.
5. PNC Business Checking
Here is the bank that will help you in the process of your financial transactions, namely PNC Business Checking.
With no monthly account maintenance fees for the first three months and a digital cash flow platform that helps you operate your business finances, this competitive account may be a good fit if you need to check but not many transactions (150 or less per month).
That's a little information about "best bank for small business". Hopefully, a little information about various things related to banking transaction needs, and also the need for small business is useful for you.
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