As a small business owner & entrepreneur, your financial needs are much different from that as the ‘Average Joe’. While it might be second nature to set up a small business account at the branch you're closest to for the sake of convenience – setting up all of your accounts and credit card processing may be more pain than its worth. Add in the monthly maintenance fees, and it may just be time for you to break up with your bank.
Many people think all financial institutions are similar, and, therefore, it doesn’t much matter which type you choose. However, before picking a place to take care of your money, consider which of your financial needs are most important to you. Then ask yourself if a traditional bank is what you want, or would another type of financial provider be more suitable?
What is a Credit Union?
A credit union is a financial service provider in the form of a not-for-profit cooperative – created, owned and operated by its members. Its profits are shared among its members, and each member has a voice in how the credit union is run.
Unlike big banking conglomerates, there is no paid board of directors. Decisions relating to products and services, interest rates, the convenience of store locations, technology and more are all made in the interest of the community it serves. With the concern for making profits out of the way, credit unions take a more personalized approach to banking, providing simple solutions to help you better manage your money while offering unwavering support.
Your Business Account with a Credit Union
As a bank customer, you realize that your bank is finding more and more innovative ways to charge you fees. These charges pop up in your monthly banking statement and, unless you are scrupulous about checking your account every month, they can fly completely under your personal radar.
Have you experienced your bank reducing your credit limit on your business credit card despite your stellar history of on-time payments? This can cause major headaches for your small business if you use your card to purchase office supplies and equipment. Couple this with high checking account fees and you may want to check out moving your account to your local credit union as a customer-friendly, lower-cost alternative.
Small business borrowers at a credit union are treated as people first, and members second. Fees and interest rates are kept low to help entrepreneurs dream big with their business, and higher rates on saving accounts and other benefits. Some even offer business courses to their small-business customers, as well as seminars on topics like online marketing and business plan writing.
Credit unions are not insured by the Federal Deposit Insurance Corporation (FDIC). Instead, member deposits in credit unions are insured by the National Credit Union Share Insurance Fund (NCUSIF) and guaranteed by the United States government up to $250,000 per account.
Don’t Bank on Just Any Bank
When looking for a small business loan, banks may seem like the obvious choice. But credit unions are an increasingly important funding source, helping small businesses get off the ground and expand.
Since the small business borrowers at a credit union are also members of the credit union, fees, and interest rates are usually lower than at commercial banks, and the credit union management is likely to be very flexible in its lending criteria. Credit union small business loans is a fast-growing segment of the financial service provider industry. Loans to members of a credit union average $212,000 per loan.
A credit union has relationships with each one of its members, meaning that you’re much more than just another account. Instead, a credit union employs financial experts who are committed to helping you better understand your business finances and find better ways to move your business forward.
If you are a small business and need a business loan, you will likely find that your large bank doesn’t want to know you. Instead of knocking your head against your bank’s brick wall, consider investigating your local credit union. A credit union representative will actually want to talk to you, and you may be pleasantly surprised at the terms and conditions available to you.
Keeping Local Dollars in Your Community
Individual work out loans can be arranged to help members in tough times to, for example, keep their homes and automobiles. In this way, the credit union supports the local community and helps to maintain it in a financially stable position. It helps its members more easily gain access to credit - credit unions understand that “bad things happen to good members.” This helps local business owners by keeping their customers and clients in the community.
The bottom line from all of this? Credit Unions are a valuable asset to your company’s bottom line. Give your business a secret weapon by setting up your small business accounts at CHROME. At CHROME, we recognize that small businesses are the lifeblood of our community. That is why we are committed to helping small business owners in our community thrive with our complete line of small business financial services and products.