Access to better interest rates and loan terms.Banks concentrate their sales efforts on bringing in a larger share of the present customer’s wallet, which can work to the customer’s advantage. Namely, more affluent bank customers can gain access to better interest rates than what is advertised to the general public. Benefit as Relationship pricing on loans and savings products, depending on the size of your overall relationship, you may be able to take lower rates on your borrowing.
Fewer fees. Because you’re considered to be a highly valuable customer, things like checking account overdraft fees are easy to have waived. Not to mention, maintaining higher balances means you’re likely to be exempt from common monthly maintenance fees, which are generally only charged when accounts fail to meet a minimum deposit requirement.
Added convenience. Benefits of relationship banking go beyond the obvious financial savings. Long-term relationship banking provides one point of contact and streamlines financial management. In essence, because a bank is already familiar with your financial situation, it takes less time to gather your information and vet the accuracy of what you report. This is not only beneficial when it comes to things like combining statements or transferring money, but also when applying for loans when the approval process can be lengthy and complicated if the lending institution doesn’t “know” you from a previous business relationship.
Higher level of customer service. Branch managers are judged by their office’s profitability, and losing a big customer could be the difference between showing profit for a branch and not. A bank manager treat his or her best and most profitable clients like royalty. It’s not unusual for customers with particularly profitable accounts to be treated with a much higher level of customer service, often having a single person appointed their personal banker to handle any need as it arises.
Long-term insight and planning. Belonging to a bank that is familiar with your financial status and history can also be extremely helpful when it comes to planning for the future. Business executives want someone who is not only experienced and knowledgeable about their business and industry but also has the analytical expertise to understand financials and knows how best to structure loan terms. One of the advantages of a well-developed banking relationship is that the experienced bank manager can assume some of the role of an unpaid financial adviser. Bank managers have experience with many types of businesses and, since they are not closely involved, can give impartial advice.
Helping at the time of downturn. It is in business best interest to contact the bank immediately if your business is facing difficulties, as there may be several ways the bank can help you. They may:
agree to change your borrowing arrangements to make repayment easier
discuss with you, and if you wish, your accountant or advisers, your plans for improving cash flow and profits
Recommend you to discuss your problem with our adviser who can help you and possibly assist with your business problems.