The financial landscape is poised to undergo changes in the next few years that may impact business owners. From managing financial risks to understanding the benefit of personalized banking services and adapting to technology, it’s crucial to stay informed and prepared.
“Now it’s more important than ever to make sure you have the right partners in their seats,” says Scott Gnau, Commercial Lending Leader at First Federal Lakewood. “Your banking partner, CPA, attorney, and a financial adviser will help you take your business to the next level.”
Smart Business spoke with Gnau about how to navigate possible financial risk effectively.
What strategies can be used to manage financial risks over the next few years?
The economy is facing numerous challenges and these factors can lead to market volatility and economic uncertainty. As a business owner, it’s important to diversify your deposits, monitor interest rates and make sure you have the right crew of partners on your side.
If you have more than $250,000 in business funds that you want to ensure are FDIC insured, banks that offer IntraFi® services like ICS® and CDARS® are a safe choice. ICS/CDARS makes sure your funds are insured by diversifying your large deposits into other financial institutions within the same network, all through one main relationship with your bank, while maintaining liquid access to your total balances.
Additionally, fluctuations in interest rates may impact your borrowing costs and investment returns. Stay informed and adjust your financial strategies accordingly and remember to bring in your trusted advisers to assist. They’ll be able to shed light on current interest rates and help you manage your cash appropriately with the proper investment tools. For example, a CPA should have a good sense of the financial forecast and could give you advice on current events, like tariffs, as it relates to your company and its performance. Your banking partner, also known as a commercial lender, may suggest treasury management tools to help prevent fraud. Looking for a team of advisers? Talk to other business owners as they may provide recommendations for trusted individuals.
Mutual banks are making their way to the forefront of banking, giving way to a one-on-one experience that could be difficult to find at a large bank — all with the same products and services as publicly traded banks have. Plus, their bankers may provide you with tailored advice that can help optimize your business strategy and achieve your business goals more effectively.
How can business owners adapt to ever-changing technology?
Change can be difficult, but adapting to technology means more efficient and secure ways to manage your business finances. Embracing these products and services can streamline operations, reduce costs and provide better insights into your financial health.
There’s no right or wrong way to start and this process happens over time. Depending on your business needs, your banking partner may suggest starting with an in-office scanner to embrace remote deposit so you can scan multiple checks at once while sitting at your desk. Following remote deposit, ACH may be the next service they recommend for you to incorporate into your day-to-day. Digital banking can be especially useful as it usually provides resources such as personalized budgeting tools and a mobile experience that you can take with you wherever you are.
With technological advances comes fraud risk. Business owners need to be aware of technology that could help combat it. Peace of mind starts with education for the whole staff — from the owner all the way to the bookkeeper and customer-facing employees. Good habits start by using encrypted email to send and receive important or private documents. Additionally, treasury management services can provide the fraud protection that business owners need, such as ACH origination and positive pay. ACH uses an encrypted system that keeps a company’s information protected, while positive pay helps deter check fraud by matching checks clearing your account to a ‘checks issued’ file that is provided to the bank, helping to prevent any suspicious checks from being processed.
By prioritizing security, you can protect your business from potential threats and maintain the trust of your customers. ●
INSIGHTS Banking & Finance is brought to you by First Federal Lakewood.
