Is bigger always better?
When it comes to banking, not exactly. Sure, big banks are commonly used and have their own perks and benefits, but local banks may actually have a few more pros and pluses than large-scale ones do.
Here’s an overview of the top 5 reasons a local bank could possibly serve you best.
Local banks offer more lending flexibility.
Community banks offer out more commercial loans than the larger ones do, and they are actually the lender of choice for small businesses. In fact, small banks gave at least some part of the financing requested to 76% of their loan applicants in 2015, and larger banks only did the same for 58%.
The focus of community banks is just that- the community.
Local banks make local differences. Unlike big banks that take deposits and give loans to different businesses in different states, small banks give and take within their own communities, benefiting everyone within the area they serve.
Small banks offer more personal service.
Banks that work within a community are very relationship-based, meaning they form connections with everyone inside of the community. One of their biggest selling points is their personal service combined with the modern amenities you expect with a large bank. They are also very well-known for their high personal satisfaction scores across the country, which have almost always been above their big bank counterparts. It’s also more likely for them to base their loan lending decisions on more personal qualities- not solely on credit reports and past financial history like the other guys do.
More local banks offer fee-free checking accounts.
About 63%, that is, according to a 2012 PIRG survey. They are also classically known for overall lower fees and interest rates. Some even reimburse the fees associated with using other banks’ ATMs, since smaller branches usually don’t have any ATMs of their own.
Smaller banks make for faster decision making.
Local banks are much quicker when it comes to approving loan decisions since they make the decisions within their own tight-knit branch, not through large committees from other cities or states. They can also open accounts and take care of problems much faster because of their smaller, more intimate workspace as well.
So, there you have it- bigger does not always mean better. Local banks are on the rise these days, and they really can offer their customers so much more than the larger guys do.