Community banks may not have the name recognition of large national banking brands. But for local residents and small business owners, community banks offer incredible value through their traditional banking services and their overall impact on your local area.
In recent years, the advantages once offered exclusively by national banks—especially regarding banking technology—have been virtually eliminated. At the same time, consumers are showing an increased preference for local businesses and organizations over national chains, which is helping spark renewed interest in community banking options.
Through a relationship with their local bank, individuals and businesses can realize important economic benefits that can’t be matched by a national bank. Here’s a look at the unique value offered by local banking options.
Local banks are invested in your community.
Community banks invest in their local areas in multiple ways. First, the money being managed by that bank is re-invested in the community through loans and other financial services for individuals, families, and small businesses. When you maintain a checking, savings, or other type of account with a community bank, you increase their ability to offer competitive mortgages and small business loans.
In addition, many local banks are actively involved in community service efforts, which can range from charitable donations and programs to sponsorship of local organizations and clubs.
The value of community banks means being more accommodating with small business loans.
When you seek out a small business loan, local banks often present a better opportunity to secure the funding you need to launch a successful venture.
Because community banks invest their time and resources into building relationships with business customers, lenders take into account your local reputation and past interactions with the bank—not just hard numbers and scores that may or may not tell the full story of your business plan. At a large institution, small businesses are just an anonymous entity looking for funding. At a community bank, you can count on working with familiar faces who know your business and are dedicated to your success.
Community banks succeed when local economies thrive, so their success is interwoven with the small businesses they support. For that reason, you can trust that your local financial institution will be invested in your business’s success.
Fee schedules are often more favorable at community banks.
At many community banks, both individuals and businesses often see better fee schedules that keep more money in their pocket. Large national banks often depend on fees to deliver a profitable revenue stream, at the expense of their customer experience.
But local banks are more accommodating. They offer free accounts, limit monthly maintenance fees, and even work with you to avoid overdraft and ATM fees. For more information, you can ask to see your community bank’s schedule of fees, and talk with other account holders to learn more about how these fees are applied.
Community banks offer a more reliable presence in your local area.
National banks may offer a larger network across the country, but their commitment to local communities is always subject to change. Between 2008-2018, for example, Bank of America closed 1,720 retail branches across the country—leaving many customers to rely on mobile banking exclusively.
Community banks, though, are based in your local area. This means they aren’t going to shift priorities and move to a different location overnight. When you bank at a local institution, you can count on them sticking around.
Most community banks offer the same online and mobile tools offered by major banks.
When online and mobile banking first took off, national bank chains had the resources to quickly invest in these customer-facing solutions. But online and mobile banking have since become a standard service offered by community banks, negating this advantage for bigger bank companies.
Today, you can bank with a local institution and use mobile check deposit, online bill pay, and all of the other popular services available through online and mobile banking. The services and features offered by local banks now rival what you find at a national chain, but they beat any big-name brand by offering exceptional customer service and a local presence you can trust.