If you run one of America’s 33 million small businesses, you’ll know traditional banking has long been a source of frustration for the country’s entrepreneurs.
For example, small business owners revealed in a 2021 CI&T report how much they dislike traditional banking fees. They find them complex and opaque. And, according to the report, they also believe they are being short-changed with interest rates on their cash balances.
Small businesses employ a staggering 61 million people nationwide, according to the Small Business Administration (SBA).
Given this contribution to towns and cities across America, it’s disappointing that owners remain underwhelmed by traditional banks.
But the same report also found small business owners still have high levels of trust in traditional banks. Many business owners have stayed with their banks for a long time. And traditional banks provide advantages such as:
But traditional banks are run in a way that can make it hard for them to deliver timely support for small business owners. Many banks have:
What does this mean if you prefer to run most of your business with digital tools and services? Well, traditional banking may slow you down.
In a recent poll, more than half of bank directors admitted business customers must still visit a branch to apply for deposit accounts or loans.
The poll showed 81 percent of banks increased their technology budget in 2022, with many pointing to investments in areas such as cybersecurity and fraud prevention. But the pace of change is unlikely to be enough for founders and small businesses who need a modern way to manage funds — and secure financing — quickly.
Small businesses like yours frequently voice the need for better access to financing. PNC’s recent economic outlook found 17 percent of business owners expected to seek a loan, or line of credit, in the next six months. But many have concerns. Of the 8 in 10 unlikely to seek credit:
Technology has enabled a range of new alternative financing options to provide small businesses with greater convenience and efficiency. Fintech businesses, like Aion, enable online applications, prompt disbursement of funds, and user-friendly platforms so small businesses can secure the services they need to move forward.
Small businesses can choose from a growing range of alternative financing sources, with new products and providers launching almost every week. Here are three options to consider:
Many traditional banks provide the financing options above too. But fintech lenders may be able to move you from application to answer more quickly, and without the need to visit a branch.
For example, Aion can assist your small business with business banking financing for a wide range of operating expenses. With term loans and lines of credit up to $5 million, Aion can provide the working capital business owners need to pay staff and vendors, purchase inventory and equipment, and invest in important sales and marketing activities. And business owners can manage accounts receivable, accounts payable, payroll, and more - all in one platform.