How alternative banking options spur business growth
A few years ago, businesses had limited options for banking. As a rule, they were restricted to choosing from big high street names for their business accounts.
But today the business banking landscape looks very different. The needs of businesses today have evolved dramatically, even over the past five years, and their banking options have increased significantly too.
As recently as 2018, businesses placed greater importance in the proximity of a branch or ATM than they did in a bank’s digital capabilities when choosing where to host their business account. But by 2022, their priorities had flipped around, and strong digital capabilities ranked far more highly than the need to be able to visit a branch or ATM.
And this is understandable. With the rise of e-commerce and global digital transactions, businesses need a banking option that can support and even facilitate their growth with a broader digital offering. They also expect banks to offer online customer service that meets their expectations, and enables them to run their business smoothly when they open a business bank account.
This has led to a proliferation of attractive and competitive alternative banking options for businesses today. Here are five ways these alternative banking options are helping to spur business growth.
1) Lower fees
With a captive market served by a few key players, banks have historically been able to charge what they want for business banking – within reason!
One of the advantages of more players entering the market – including alternative banking options – has been increased competition, which has led to a push for greater innovation, and more choice regarding fees. Search for ‘free business banking’ in Google and you’ll be presented with a wealth of options for your business account.
The prevalence of alternative banking options also means more competition for lower transaction fees – especially if you conduct business overseas.
And with an increasing move to digital banking, there is no longer a need to pay to have a branch on every high street, and a business manager in every branch. Instead, today’s banking alternatives can serve customers remotely from fewer locations, reducing their overheads.
2) Better customer service
Greater competition, including increasingly popular alternatives to the traditional banking model, prevents banks from becoming complacent. Today, if a customer doesn’t get the help they need from their bank, they can more easily move their account elsewhere and find a bank who offers what they need. Or change the way they manage their money completely.
As a result, banks and other financial organisations need to offer better customer service today. This has also become easier thanks to digital technology.
We’re more comfortable conducting our business online today, and have several options to do so. We no longer need to make an appointment at our nearest branch and take time away from our business to travel there for a meeting. Instead we can communicate directly online, and even have a video call with our business manager.
3) Easier financial management
One of the reasons businesses open business bank accounts is to separate their business expenses and income from their personal bank account. It also makes it easier to track income and outgoings.
And today’s modern banks and alternative banking providers have evolved to offer more than just a place to store your money, facilitate transactions and offer you credit. Now, thanks to technological innovation, they can help you manage your finances too.
Here are just some of the ways banks today can make running and growing your business more easy:
- Online and smartphone apps: Online and app-based digital portals allow you to check your business bank account and manage your money.
- Financial reports: You can generate simple expense and income reports from your bank account app or online portal.
- Upload receipts and invoices: You can scan and upload business receipts and invoices.
- Scan and pay in cheques: You can scan and pay in cheques on your phone banking app.
- Integration with your business software: You can integrate your business bank account with other business services, such as accounting software to save time and inconvenience.
- Automating financial tasks: You can set up automating recurring payments, invoices and other financial tasks to save time and reduce potential income loss.
- Create instant payment links: Create a link and share it with your customers so they can pay instantly in their chosen currency.
4) Improved access to business credit
A bank isn’t just a place to store your money and conduct financial transactions for you. It can also give you access to business credit which can help you manage and grow your business more easily.
While your business may not need to borrow capital right now, you may need a business loan or line of credit in future to enable you to expand your business. And the more business business banking evolves, the greater the options available to businesses.
Today businesses don’t just need to turn to their business bank or other traditional financial institution for a loan or line of credit. They can also approach one of the many established banking alternatives.
5) Expand into new markets
Many businesses today don’t just trade in their home country; they import, export and sell directly to other countries and territories around the world. And to do so, they need an international business bank account.
Modern alternative banking options allow businesses to open multi currency accounts without needing to visit a bank branch, so they can start earning money from customers in their preferred currency straight away.
Many also enable businesses to create borderless virtual and physical employee cards quickly, for no cost. And to make quick money transfers in multiple currencies with low fees and competitive exchange rates.
Not happy with your business bank? Look around!
If you aren’t happy with your business bank, maybe it is time to look around for an alternative. And not just another traditional high street name. Take a look at some of the alternative banking solutions for business today. You may find they can help your business grow.