If you’re a small business owner, or if you’re just starting out, you know how important (and stressful) acquiring financing can be. Hometown banks can be one of your allies. As a part of the community, hometown banks want to see the local economy do well. They also want to see their neighbors, like you, prospering.
Ryan Schneider lives in Aberdeen, South Dakota—estimated population 27,333. As an Assistant VP and Business Banker for Plains Commerce Bank, he works with local area businesses on a regular basis. He shares how he has seen hometown banks, like Plains Commerce Bank, help small businesses and keep the community financially strong.
Hometown Banks Are Relationship Banks
Often, hometown banks like ours have the ability to lend more to small businesses. That’s because we don’t only look at numbers when approving a loan, but also the type of person we are considering partnering with. An applicant’s financial stability and ability to pay off a loan are still important factors used during the loan decision-making process. However, we take time to get to know the character of the business owner. This allows us to place more faith in current or aspiring business owners.
In turn, business owners can also nurture their relationship with their banker. Get to know the bank you want to work with as much as the banker is getting to know you. Not all hometown banks are the same. Some, like Plains Commerce Bank, prefer helping both start-ups and entrepreneurs seeking loans for business growth, while other banks may hone in on one area. Make sure that the hometown bank you want to work with has the expertise and resources to help you reach your goals.
With a strong bank relationship, good credit history, and solid business plan, you’ll likely be able to gain more capital than if you didn’t have that face-to-face time with your bank.
Hometown Banks Grow Communities
Because hometown banks can sometimes take a little more risk when lending money, local businesses that start to do well after acquiring funds really grow our communities. Business owners who start or expand their operations create jobs. This, in turn, puts more dollars into the local economy—a snowball effect that can benefit other local business. And sometimes, this all starts through a partnership between hometown banks and small businesses.
Relationships and community matter. And when a bank and its employees are invested in the community, things that aren’t always possible at bigger banks can become a reality. If you're a small business owner, start building credibility and a relationship with your local bank now.