5 Things to Consider before Opening a Business Bank Account

There are two general broad categories of bank accounts: personal accounts and business accounts. Each bank, of course, has its own sub-categories of these accounts.

While some people use their personal accounts for their businesses, quite a number of businesspersons prefer opening separate bank accounts for themselves and their businesses for very obvious and practical reasons.

So what is one supposed to consider before opening a bank account for their business? If you look around, there is no shortage of banks and more seem to be emerging every day. Before you pop into any of the banks, here are five things you should consider:

1. Bank Charges: We do not expect banks to give us free services. They are businesses like ours and are also in for the profit. However, if the bank you have approached does not offer you competitive rates for its services, look for another one!
2. Technology: This is not 1900. If you have approached a bank that does not take technological advancements seriously, let it be. It will cause you unnecessary problems. This is the era of taking little time in banking halls and doing your banking from the comfort of your home or business premises. 
3. Interest Paid:  You might have noticed that banks are very stingy and exploitative. They charge you obscene interest rates for the loans you take and pay you peanuts (if anything) on the money you save with them. If you can find a bank that pays you slightly more than others, that's the bank for you!
4. Minimum Balance: Every bank account has a minimum  balance. For most personal accounts in quite a number of the banks around, that balance is always zero. For business accounts however, the figure might be different. Always remember not to put all of your money as the minimum balance in a bank account. Get the point?
5. Credit Facilities: The reason why most businesses start small is because the owners do not have the resources to start big. But with time, every businessperson wants to diversify and grow their business. Sometimes, the plan costs more than the money saved for it. This is the time when loans are sought. It is imperative that you get a bank that is willing to advance you credit at reasonable rates.

Well, there are many other factors one needs to consider before opening bank accounts for their businesses. The idea is always to look for a bank that works for you. If you feel your bank is not responsive enough to your needs and does not take you or itself seriously, ditch it!

- Karani Kelvin - sirkarani@gmail.com