Which Bank for your company?


Most young entrepreneur has this question in mind – which is suitable bank for my company or firm.

Most banks are here to do business and have physical and online services. Mindset of banker may affect business of their clients. They all have their target clients – you must be one of target client. A software company may not have good business relation with regional rural banks. Likewise a personal banking branch may not serve as good as corporate banking branch.

Corporate Banking Branches

Yes, corporate banking branch is suitable for a company. Bankers employed in these branch usually understanding legal complications and requirements of companies. Most companies need at least one trading account along with special purpose accounts like dividend (declaration) account, escrow accounts. If you are planning to be big, you must have banking with corporate banking branch. This is my first suggestion.

MSME Branches

In case of MSME –medium, small and micro enterprises there are specialised MSME branches of many banks. They have specially trained staff with understanding of various government schemes, subsidies, and compliances required by MSMEs.

Servicing with government

I have interesting banking experience. When you have to deposit certain taxes, duties and fees certain services are provided by certain banks only. Until recently, only select few branches of select banks accepts tax deposits. In case of big payment you cannot go for credit card or debit card route but net banking or online banking. If we take example of Ministry of Corporate affairs only a handful banks provide net-banking services for MCA payments being bank of that ministry.

This is advisable to have an account with such banks to avoid hassles. How to know about such banks? Firstly assess your day to day transactions with government authorities like MCA payments, tax payments. Check available banking channel for ease of payments. Such statutory payments may be routed through separate bank accounts without much interaction with your main business account.

Foreign trade

Exporter or importer of goods or services needs to have banking relationship with designated Foreign Exchange branches. Any regular user of foreign exchange should have accounts with these branches. These foreign exchange branches may service you better when you need forward trading, hedging, and other foreign exchange related legal compliances. Usually these branches may guide companies appropriately.

Technically over, now what

These were major technical consideration in case of corporate or business banking. However, there are many locations where such banking services are not available. Same time in major business centres like Delhi NCR and Mumbai Metropolitan Area there are lot of such banking branches. How to choose correct one?

I have some parameters or my personal bias –

  • Compare online banking services, select better interface;
  • Opt for at least double authentication even if you treat it extra irritation, it is safe;
  • Nearest branch is better, in case of any personal visit required;
  • Private sector banks (direct and hidden) charges more but have less crowd in case time is essence of business;
  • Public sector banks are good tax and other government payments;
  • Privilege accounts and its terms;
  • Corporate requirement like dividend accounts, escrow accounts and such specially designated accounts without hassle
  • Less number of accounts with possibly high value trade is better

Few readers still need name of particular banks. I have no endorsement contract with any bank so no name is given here. In lighter tone – banks may contact me for service review to publish in my blog. J. Happy banking.

This post is written in response of Quora Question.

 

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