“Complexity is the enemy of execution.” Tony Robbins
We are commonly attracted to the complex but it also traps us from the efficiency of a simple structure. We’ve outlined three moves your business can make today to maximize your returns in your business checking.
Your business may be better set for a business checking account that pays interest. In 2011, there was a regulation change that allows banks to pay interest on business checking accounts. Prior to the change, business checking accounts earned “earnings credits” which allowed for the reduction in fees but no earnings. This was a major shift and helps many businesses that keep great balances but don’t have tons of activity. Let’s review an example of an account with 153 items clearing and a $175,821 average balance:
*This grid is for example purposes only. More information can be found on our Business Accounts page or please talk to a banker today to get specific details, discuss your individual business’s needs, and for a comparison on your accounts.
As you can see from the comparison, moving into an Admiral Checking account, business checking with interest, would have increased monthly earnings by $37.33 vs a traditional Business Plus account.
In the traditional account, the earnings credit offset the activity but didn’t allow for any interest to be earned. Furthermore, the activity was not high enough to exceed the free items allowed by an interest checking account and even if it did, it would have required even more items to exceed the interest earned. This is low-hanging fruit with Flagship Bank Minnesota but in consideration of more complex products at other financial institutions, we have seen new customers see combined savings and increased earnings over $1,000 or more in a given year.
Small businesses often miss an opportunity to sweep excess funds into a money market/savings account or pay down a line of credit. To maximize the opportunity, the process starts with isolating how much depository funds are needed for everyday transaction activity. If this balance is $25,000, $50,000, or $100,000, set a target and then contact your banker to set up a sweep of the remaining funds to your business line of credit or into a money market account. Please keep in mind the six transactions monthly limit for withdrawal transactions on a money market account as the sweep can go both ways.
Customers have mailed checks from office to office, to the bank, or scheduled regular branch visits to make deposits. Remote deposit capture (commonly referred to as RDC) allows your offices to scan check deposits in from their location to minimize delays and improve collection times.
Built for businesses with regular check collection activities, remote deposit has become increasingly common over the past few years. Here’s a short list of some of the many benefits of RDC:
The move to remote deposit capture for your business is easy with the support of your local banker. The bank will provide the necessary software and hardware as well as the on-site training to get you up and running.