When it comes to money, most decisions come down to a dollar amount, rather than an account number. It’s easy to take for granted which bank manages the account and focus instead on how much remains in the account after an expense or how much interest has accrued on a loan. Particularly in the age of online bill pay and mobile banking, the institution behind the account can seem more fungible than the money in the account itself.
At the same time, this is also the age of data privacy concerns, increased competition for small business financing and big banking scandals like the one that recently rocked Wells Fargo. These concerns make it clear that where you keep money — and not just how much you have — really matters. For customers, small businesses and local economies, community banks and credit unions offer important benefits over the big banks of Wall Street.
Community banks and credit unions offer the same member-friendly services as big banks, such as mobile and online banking platforms, but there’s one big difference: Local banks tend to charge lower fees. This makes it easier to spend, save or move your money as needed. Plus, when you do need more than arm’s length service, you can meet with a representative who makes decisions at the local level. This helps to foster trust between the local bank and its customers, giving you confidence in your financial decisions and investments.
For Small Businesses
Community banks and small businesses go hand in hand. As independent institutions themselves, it only makes sense that small businesses turn to local banks and credit unions for their financing needs and day-to-day services. More than logical, this relationship is also productive. By making decisions at the local level and participating more directly in the local economy, community banks and credit unions are better situated to loan money to small businesses and entrepreneurs in the community. They allow burgeoning businesses to negotiate with a fellow local institution and find a partner in the local market.
For Local Economies
As their label suggests, community banks and credit unions serve their local communities. They provide essential financial services that keep the local economy running. They also keep money in the community, investing in local projects and businesses, rather than taking speculative risks with clients’ money. Without a Wall Street headquarters to answer to, community banks and credit unions can better support their local economies.
As Community Banking Month comes to an end, keep the benefits of local banking in mind when you consider saving, spending or investing. These local institutions make a difference in the community no matter what dollar amount is attached to your account.