Options for the Entrepreneur and Small Businesses:
Banks and Credit Unions. Each can have their advantages, whether local, regional or national. Here is a comparison of three of the largest national/international banks’ costs for small businesses:
Best Small Business Checking Account
If you are looking for a free business checking account most banks offer a business checking plan with no monthly fees provided you maintain a minimum average deposit level in order to avoid monthly account fees. Also most free checking accounts charge fees when the business account passes a certain level of monthly transactions, either in number or dollar amount of cash transactions.
|Checking Product||Bank of America Business Fundamentals||Wells Fargo Business Checking Choice||Citibank Business Checking Plus|
|Number Of Branches||4,833||6,244||807|
|Average Balance Required For Free Business Checking||$5,000||$7,500||$5,000|
|Monthly Fee If Monthly Balance Not Met||Varies By State.
|$14||Varies By State
|Free Monthly Transactions||200||200||250|
|Fees On Physical Cash Deposits||Up to $10K: Free
$10 -$25K: 0.2%
Above $25K: 0.3%
|Up to $7.5K: Free
Above $7.5K: 0.3%
|Up to $10K: Free
Above $10K: 0.3%
|Online Chat For Questions||Yes||No||No|
|Mobile App||Good||Good||Below Average|
|Debit Cards Designed For Employees||Yes||No||No|
Some steps required in applying for a small business loan. You may want to consider a relationship-account lender in your community where your business is located; however, you may want to compare the terms and relationship with an on line lender/bank as well.
Before applying for a loan, prepare by being able to answer these questions:
1: GO THROUGH A SELF ASSESSMENT
- “Would I lend my own money to my business?”
- “Do my customers recommend my business?”
- “Do my employees feel engaged, valued and good about coming to work?”
- “Do I have a mentor or experienced entrepreneur at my side?”
- “Are my financials current and comprehensive?”
- CONQUER CASH-FLOW & FINANCIALS FIRST
Once you’ve finished your assessment, get your presentation prepared.
- To obtain a traditional bank loan, it’s important to understand what lenders are looking for. You’ll be evaluated on business profitability, cash flow, credit history and collateral.
Inaccurate and incomplete financial records are the leading setbacks for small-business owners in the lending process. Prepare historical (at least the last three years financials and tax returns), current year to date and pro-forma budget projections for the succeeding three years.
To make sure your financials are current, take time at the end of each week or month to review and update your balance sheets, accounts receivables, current liabilities, and profit and loss statements.
- Research all Available Options. Consider the option of a Small Business Administration (SBA) loan from an SBA approved lender that has considerable SBA lending experience. It can result in an easier decision by the Bank and often a lower interest rate.
Consider on line lenders: Prosper; SoFi; Upstart; Lending Club.
Consider Fundera.com, as one option to find and secure a small business loan. With one application, you can apply to multiple lenders, ensuring you get the lowest cost loan in the fastest amount of time. Integrated with QuickBooks.
4. Evaluate Your Business Needs and Borrow only what is Needed.