You’re committed to servicing your clients and customers, and it’s often those what seem like small expenses – such as bank fees – that can really put a dent in your hard earned dollars over time.
We get that as a busy small business owner you probably don’t get a chance to explore alternatives, and as such… The pesky fees continue to add up.
So, we’ve done the hard lift for you. Below are some of our key tips when it comes to reducing your small business bank fees.
Keep tabs on any direct debits
These are the payments from you to suppliers or service providers that come out of your account on a recurring basis, such as monthly or annually. They might include subscriptions to project management tools, accounting and bookkeeping software, and publications, or could be the gas and electricity bills for your office.
We recommend keeping due dates for all transactions like these in your diary, so you can ensure you’ve got the cash in your account to pay them. Because if you don’t, you could be in for an over withdrawal fee..
While one of these won’t break the bank, they can quickly become a hindrance if you’ve got many direct debits coming out of the one account, or if your bank charges a fee for each day your account is in the negative.
Got a term deposit? Commit to it
If business is tracking well and you’re looking to open a high interest and/or term deposit account, be aware of the fine print first.
Pretty much every bank will charge a hefty fee if you choose to withdraw from a term deposit (which can vary in length, depending on the bank, from three to 24 months) before it reaches maturity – i.e. before the period you selected comes to an end.
For non-fixed term, high interest accounts that allow withdrawals, be aware of any interest you could be missing out on depending on how often you take cash out.
Be aware of any minimum account balances
On that note, before you create a new account, or even if you’ve already opened one, check if you’ll incur any fees if your balance reaches below a certain amount.
You might automatically think this is zero, as no cash in the bank equates to an over withdrawal, however some accounts do impose other minimum balances.
Seek out alternatives for international transactions
This one applies not only if you’ve got clients overseas, many subscriptions to companies such as global software providers are in either USD or GBP, and Australian-based companies are increasingly invoicing in USD, as it’s an internationally recognised currency.
In pretty much every instance, banks will charge you a high fee for processing these transactions, which is where platforms such as Wise come in. By creating an account, it allows you to receive and make payments, as well as access your cash in the local currency if you’re traveling abroad. Furthermore, their fees tend to be lower than other providers out there.
AirWallex is another one you might want to consider, and we delve into this one further in our Five bank accounts for small business owners blog.
Look to your tech
Finally, we have so many affordable technology and cloud-based tools at our fingertips that can help you stay on track of your incomings and outgoings, so that you can clearly see if bank fees are adding up, when direct debits are due, and more.
A lot of banking apps have payment calendars and push notification features that you can use to remind yourself when recurring payments are due, too.
Feeling a little overwhelmed?
Get in touch with us for free here and we’ll help you identify ways to cut costs, create a budget so that you have a clear view of your incomings and outgoings, and more.
*This article is a guide only. MicroChilli always recommends consulting with a financial professional and banking institutions when exploring banking fees and bank accounts.
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