One of the biggest trends in business banking these days is new products geared toward simplifying the lives of small to mid-sized company owners.
“Financial institutions are paying more attention to small businesses, more so than they ever have,” says Miles Milton, institutional marketing manager for FirstMerit Corp. “Marketing to them has become more sophisticated.”
Milton, who has been in the banking industry for 15 years and has worked for several of the area’s largest financial institutions, says most banks are just now realizing there’s more to a small business customer than strictly making commercial loans.
“They (banks) were lumping small businesses into commercial lending,” he says. “A commercial lender is typically not going to spend time on a small business.”
While he says that small- to mid-sized businesses have always been FirstMerit’s bread and butter, most banks have completely reorganized over the past few years to focus on this until-recently untapped market.
Instead of just offering commercial loans, banks are offering products designed specifically to meet the needs of a busy business owner.
“Small business owners, for the most part, are the owner, the CFO, and may even be the HR department — they’re doing everything. You’ve really got to come out with products that make it easy on them,” says Milton. “Before, they were serving them with consumer products or serving them with large-scale commercial products which were really complex.”
FirstMerit has just created a new line of checking products for business owners. Instead of charging them a fee per transaction, which is difficult to keep track of and oftentimes adds up to a large, added, monthly expense, FirstMerit is offering business owners a checking account with an allowance for 100 to 200 (depending on the balance) free monthly transactions. There is a monthly fee for the account (between $7 and $12) if a modest monthly balance isn’t maintained.
Along with the checking account, FirstMerit is offering businesses a debit card (similar to the card now popular with consumers) with free unlimited transactions, and a combined statement for business checking and linked accounts.
Along with FirstMerit, which has the majority of the market share in Summit County, some of the area’s small community banks have also started to offer simplified products to lure small business owners. Morgan Bank in Hudson offers a “Three for Free” package to individuals, sole proprietors and nonprofits. The checking account, which yields 3 percent annual interest, comes without monthly fees, balance requirements or per-item charges.
In addition, checking customers can make unlimited free transactions with their Morgan Bank Mastercard.
Morgan Bank’s CEO and president, William “Wink” Dougherty, told SBN last month the bank can offer these free services because its loan volume is so high.
How to reach: FirstMerit Corp, (330) 384-7104; Morgan Bank, (888) 656-3267