The Advantages of Small Banks

Jun 28 09:27 2011 Stanley Hermosillo Print This Article

Sometimes it takes a small bank to make a community grow. From granting SBA loans quickly and easily to offering Massachusetts Free Checking Accountswith no strings attached,Guest Posting small Massachusetts banks are a helping hand in the community.

            In fact, that interpersonal connection is a crucial element in what makes small banks tick. With branches located in only specific regions of the country, small banks know their market and work in the interest of cultivating that market to its fullest potential.

 Knowing one’s community is a powerful asset. It is true that both small and large banks employ individuals from the surrounding area. Naturally, employees would have insider knowledge of their neighborhood: not only understanding which mall is profitable but why that mall works. The difference is what branch workers can do with that information. Small banks are not tied down by the bureaucracy of larger financial institutions.  For example, in recent years, large banks have shied away from granting student loans to individuals based entirely on their level of risk. Small banks use a different method when considering loan applications. While individual risk is still a factor in the loan process, writes that small banks typically place a lot more emphasis on one-on-one interviews. ( Bank employees are given leeway to make decisions based on their personal knowledge of the loan applicant in addition to the traditional risk-factor method.

Small businesses are granted the same consideration. Big banks have the advantage of having more branches and offering loans at competitive interest rates. However, getting access to those loans is another story. According to the Small Business Administration (SBA), community banks in Massachusetts will typically accept more loan applications than large financial institutions. ( lenders?order=Lender_Name&sort=asc&office=0101)

In addition to issuing more loans than larger banks, Massachusetts Community Banks stand loyally next to free-checking while big banks have taken a step back. For example, points out that many large financial institutions have dissolved their policy of reimbursing out-of-network ATM fees if they don’t maintain a $2,000 daily account balance. Other big banks have gradually done away with free-checking entirely. Citigroup doesn’t offer free-checking to new customers. Mike Moebs, founder of Meobs Services (an economic research firm), told that community banks have smaller operating costs which allows them to continue offering free checking. It gives local financial institutions a competitive edge. (

With free-checking and easier access to Massachusetts Small Business Loans  and student loans, small banks take care of their community.

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About Article Author

Stanley Hermosillo
Stanley Hermosillo

Morgan is a resident of Massachusetts. She writes about local banking and the difficulties of choosing the best Massachusetts mortgage rates and Massachusetts small business loans. She also writes about Massachusetts auto loans and other local finance related topics.

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