How Small Businesses Can Use Mobile Banking to their Advantage

It is no secret that opening a bank account is integral to the operations of a small business. The Small Business Administration cites key advantages:

• It is professional to make a bank account for your business. With an established account, customers can charge their credit cards directly to your business.
• The option of a credit card gives you the ability to easily spend money if there is an emergency or for large purchases when starting out.
• A credit card can give your business credit history.
• Using a business bank account can establish your credibility by offering merchant protection.
• It will also assure each transaction is secure.
• Separating your personal bank account from your business’s significantly reduces personal liability.

We have witnessed the COVID-19 pandemic become a huge disruptor to businesses. Small business owners had to adjust to the federally mandated limits on in-person transactions, and because of these limitations, there was a large-scale increase in our internet reliance, particularly e-commerce.

COVID-19 has proven that digital banking plays an important role in money management. By no means is banking online or on a mobile phone new to business owners, however, it has become a very practical way for handling finances, especially with banks limiting in-person hours and appointments.

Benefits of Mobile Banking

True, our reliance on smartphones has been growing with the rise of the digital age, but there is also practicality to using our phones for money management. Being an entrepreneur or small business owner likely means you are busy, on the go, and low and behold, the smartphone will come with you. And with the COVID-19 pandemic, it is likely that banking has become a task to do on the run or in an at-home office.

And as Forbes reminds us, there is value in the vast connections made from online banking. With a mobile application for banking, there is no longer a necessity to be close to the actual bank itself, therefore increasing bank options for small business owners. It allows small business owners the power of choice. Ultimately, owners can look for banking services that value their business’s brand, and increase connections in their own communities. Forbes uses Daylight as an example of a banking app that brands itself as both for and run by LGBTQ+ people. But there are also more practical perks to online banking for small businesses. Forbes lists a few:

• You can make transactions, deposit checks, and transfer money at any time. Therefore, it is the ultimate time conserver.
• Mobile payments can eliminate the use of cash. Not only does make checkout safer, as business owners no longer need to then stash money in their pockets, but it also allows for all monetary transactions to be monitored. Therefore, you will always know where your money is, and where it is heading.
• With mobile banking comes the option of a notification system. When your mind is in a million places at once, notifications can serve as a necessary reminder that your balance is low, or your transfer went through, etc.
• Money can be sent anywhere minutes after the point-of-sale.
• Help is at your disposal. Rather than seeking out in-person appointments, mobile banking apps can connect with you virtual experts that can answer your financial questions. Particularly, this can be useful when making large-scale spending decisions.

Just as the Small Business Administration recommends the creation of a business bank account for the business owner’s and customer’s protection, Forbes notes that online banking is advantageous in its protective security measures. For example, mobile banking apps use multi-factor authentication before displaying any account information.

FDIC Insurance

Moreover, the Federal Deposit Insurance Corporation (FDIC), developed in 1933 by President Franklin Delano Roosevelt, assures the protection of your banking deposits up to $25,000 in the event of a bank’s closure. This makes choosing an FDIC member bank a priority.

As advantageous as mobile banking is, communication is just as important. The shift to business banking in a post-COVID world should serve as a reminder of the importance of human contact. The occasional drop-in to the bank or live phone call assures that it is not the internet alone advising your spending and transfer funds.

And communication with bank representatives makes good practice for conversations with future customers. After all, as any business owner knows, the success of the business is reliant on the satisfaction of people, and personal interaction can only help their satisfaction.

Mobile Banking App Options

With that being said, there are many different banking apps to choose from. As a small business owner, it is important to choose a bank that ticks many of the boxes discussed above. Ultimately though, the trick to choosing one can be dependent on what you, as a business owner, value. As of July 2021, Business Insider published an extensive pros and cons list of apps they deemed to be the best of the year. Among these options were Ally, BB&T, Betterment, Capital One, Charles Schwab, Chase, Discover, Huntington Bank, and Synchrony. Here are some of the perks that Business Insider notes these banking apps to be able to offer to small business owners:

Ally Bank (member FDIC bank)

– Gives you the ability to separate your business’s savings into different “saving buckets,” helping you create a visual savings plan

– Lets you deposit checks from your mobile device

– Gives you the ability to speak to a live customer service representative around the clock

– Gives you a fairly high annual percentage yield (APY)

Bottom Line: Ally Bank is a good provider option for small business owners with unconventional schedules and a multifaceted savings plan.

BB&T Bank (member FDIC bank)

– Offers you the ability to check your business’s account balances without having to log in

– Lets you deposit checks from your mobile device

Bottom Line: BB&T Bank’s app is a good option for small business owners who are on the go, and may not always have the time to log in and comprehensively check their accounts.

Betterment Bank (deposits are FDIC insured)

– Offers you reimbursement on any ATM fee or foreign transaction fee

– Lets you deposit checks from your mobile device

– Makes cash-back rewards available to you

– Automatically takes any additional money in your checking account and move it to your savings account

Bottom Line: Betterment Bank is a good provider option for small business owners who travel often and have long-term saving plans.

Capital One (member FDIC bank)

– Does not charge you on any foreign transaction fees

– Lets you deposit checks from your mobile device

– Will keep tabs on your credit score

– Gives you a fairly high annual percentage yield (APY)

Bottom Line: Capital One is a good option for small business owners who travel often, are interested in future investments, and have long-term saving goals.

Charles Schwab (deposits are FDIC insured)

– Offers you reimbursement on any ATM fee or foreign transaction fee.

– Lets you deposit checks from your mobile device

Bottom Line: Charles Schwab is a good option for small business owners who travel often.

Chase Bank (member FDIC bank)

– Gives you the ability to separate your business’s savings into different folders, which allows for a visual savings plan

– Allows for an automatic transfer of money into these different savings folders

– Lets you deposit checks from your mobile device

– Will keep tabs on your credit score

– Combines tracking your credit card usage and your bank account transactions in the same app for easy access

Bottom Line: Chase Bank’s mobile app is a good option for small business owners who are always on the go and have extensive, multifaceted savings goals.

Discover Bank (member FDIC bank)

– Lets you deposit checks from your mobile device

– Will keep tabs on your credit score

– Gives you the ability to speak to a live customer service representative around the clock

– Makes cash-back rewards available to you

– Combines tracking your credit card usage and your bank account transactions in the same app for easy access

– Gives you a relatively high annual percentage yield (APY)

Bottom Line: Discover Bank is a good option for small business owners who have unconventional schedules and have extensive savings goals.

Huntington Bank (member FDIC bank)

– Offers you the ability to check your business’s account balances without having to log in

– Gives you the ability to turn on an automatic alert notification system for any suspicious activity

– Lets you deposit checks from your mobile device

Bottom Line: Huntington Bank is a good option for small business owners who are always on the go and meticulously monitor their money.

Synchrony Bank (member FDIC bank)

– Lets you deposit checks from your mobile device

– Gives you a fairly high annual percentage yield (APY)

– Combines tracking your credit card usage and your bank account transactions in the same app for easy access

Bottom Line: Synchrony Bank is a good option for small business owners who have extensive savings goals.

Overview

Just as customers invest in your business, you are investing in a bank when you sign up for its mobile app. Therefore, it is important to be selective and weigh the advantages of each bank, as it is important to choose something that aligns with your business and your values. Allow yourself to use these mobile banking apps to your advantage.