By Scott Rutherford
n an age where more and more of the world’s financial transactions are conducted with the click of a mouse or a quick tap on the smartphone, often through large national banks or online institutions that don’t even have a brick-and-mortar structure, there’s still something to be said for banking locally.
As one article from Bankrate puts it, “Traditional banking offers a personal touch. Customers can stop by their bank and talk to someone who can access their accounts and answer questions. To many people, this is more assuring than dealing with a machine.”
The advantages of speaking with a real person are even greater for local community banks than they are for their national counterparts. As anyone who has banked locally for any period of time can tell you, you quickly get to know the people with whom you’re conducting your business – the people who not only safeguard your money, but whom you may also have to ask for loans.
That local touch matters, especially for small business owners. An article in The Balance put it well: “Because they’re engaged in local matters, local banks may make transactions easier. That’s particularly true if you need to borrow money. For example, megabanks might be unwilling to fund your local business, investment property, or agriculture loan, but local banks are accustomed to evaluating loans in your area.”
Just as importantly, local community banks are involved in the community. More of your money stays in the community with a local bank and their profits are much more likely to fund local organizations and causes. Local banks often have scholarship funds, and it would truly be a rare local bank that didn’t sponsor local sports teams and community events.
Of course, as with all things, not all community banks are created equal. Community banks tend to have lower fees than national banks, but that can vary considerably. Involvement in the community can also vary considerably. Asking your local bankers what events and organizations their bank sponsors is one way of making sure that you do business with an institution whose community support lines up with your own priorities.
A final note: some may be concerned that community banks, because they tend to be smaller, may not be able to provide all the services larger, less personal banks can. In today’s world, that’s just not as true as it may have been at one time. At most community banks, you’ll have the same or similar online banking options as you’ll find in larger banks. You’ll also find all the standard banking products and services. In cases where you have specific needs that community banks don’t manage in-house, many of them are able to outsource the services while still offering you a more personal, local touch.