Internet banking isn’t a new idea – but it’s being adapted in innovative ways that can benefit businesses of all shapes and sizes. Cash management and other banking services once out of reach to all but the very largest companies have been tailored to small and mid-sized businesses, as well. And thanks to new technology, these services are becoming more readily available in metro Milwaukee, providing the opportunity for businesses of any size to take advantage.
Throughout my banking career, I’ve learned that an important element of the job is taking time to learn a customer’s business cycle, from invoicing, payroll and accounts payable procedures to bookkeeping and other financial management processes. Almost without exception, I’m able to suggest ways that new, technology-based services can enhance a client’s business operations – whether it’s giving them quicker access to funds; money-saving payroll, bill-paying and collection options; or new ways to make the most of cash on hand.
Many of my clients – especially smaller businesses that often don’t even have a full-time person handling payroll and bookkeeping – have found that new banking technology can reap big benefits. Here are just a few examples of new, Internet-based cash management and banking services that could have a major impact on your business.
Automated Clearing House (ACH) Origination:
ACH Origination allows businesses to automatically make and collect payments online and is ideal for any company that wants to streamline bookkeeping and reduce the hassle and expense of making all payments by check. It works for everything from payroll disbursements via direct deposit to federal and state tax payments, business-to-business payments, charitable contributions and more. Companies save time and money by eliminating excessive check writing and handling, save costly “back-office” time by reducing the need for account reconciliation, reduce fraud exposure due to lost or stolen checks and get more accurate cash-flow projections by controlling timing of payments.
Remote deposit capture
The Federal Reserve calls RDC, which is just starting to be offered by community banks in metro Milwaukee, “the most important development the U.S. banking industry has seen in years.” With RDC, businesses use a desktop device to electronically scan received checks and securely transmit the scanned images to their bank for deposit. It saves time (and gas!) for businesses by eliminating the need for daily runs to bring paper checks to the bank, and it also narrows the gap between the time a business receives a check and the time it has access to the actual funds. RDC gives businesses new flexibility to deposit checks outside of traditional bank hours, and there are a number of other security, money-saving and convenience benefits, as well.
Business information reporting
Business information reporting gives a company greater control and oversight of its finances through a portfolio of online tools that provide real-time snapshots of a company’s financial position. Management can control employee access and select appropriate accounts and activities based on the employee’s job function. The tools also allow companies with multiple divisions or affiliate organizations to see all of their account information combined within one view.
Payroll cards
Payroll cards – essentially reloadable, pre-paid debit cards – allow businesses to use direct deposit to pay employees without bank accounts. Businesses place the employee’s wages on the card each pay period, and the employee can use the card at any ATM or merchant that accepts debit cards. Payroll cards are a great way for businesses to streamline payroll operations and save money by eliminating paper paychecks and the associated administrative, printing, postage and storage costs.
“Sweep” services
Sweep accounts maximize company funds and put cash management decisions on “auto-pilot” by automatically transferring any amount over a specified commercial checking account balance to where it benefits the business most. This could be to pay down a line of credit or add money to an investment tool like a Repurchase Agreement or money market mutual fund. For smaller businesses, which often don’t have the time or personnel to make daily cash management decisions, sweeps allow the opportunity to realize higher returns on funds that would otherwise languish in a checking account.
These services each have their own advantages – and they share one important characteristic. While preserving the security and accuracy of a company’s finances, they all cut down the hours spent with checkbooks, ledgers and bank statements. This allows business leaders more time to do what they do best – serve their customers, mentor their employees and grow their businesses to their fullest potential.
Jill Miller-Custer is vice president – Business Banking for North Shore Bank. North Shore Bank is headquartered in Brookfield and has 42 branches throughout eastern Wisconsin and northeastern Illinois. To reach Jill, e-mail jmiller-custer@northshorebank.com.
