Sara Parker, from Utah Central Credit Union, outlines some of the help small businesses can find from a financial institution.
• Electronic Funds TransferCredit cards have replaced cash and checks as the number one source of payment for goods and services. So businesses need fast and reliable card processing equipment – from credit card terminals and wireless devices to pin pads. And new technology means transactions can go through instantly -instead of waiting for dial-up. And at the end of the day, a credit union or bank can electronically tally your purchases and pay the user fee that’s owed to the credit card company, while setting aside your earnings.
• Online Banking
This is another great time saver. Because so much cash is flowing in so many different directions in the course of a day -especially with a restaurant -to customers, vendors, overhead like building rent, professional services, etc. And sometimes that cash flow can be volatile – meaning some days you take in more than other days – so you want to determine which days you pay your bills, and online banking is a great way to do that.
Also, online banking is a great way to transfer money from personal accounts to business accounts at the click of a mouse.
• Tax Deposits
If you have more than one employee your financial institution can withhold money that must be set aside from wages for taxes, social security and Medicare. Additionally a business owner may be required to set aside funds for unemployment compensation for employees who lose their jobs.
If you’re not a math whiz – and even if you are – these deposits are so tedious and technical that it’s better to let a financial expert handle them.
• Checking and Savings Accounts
These are probably the most basic services available to a small business owner – and the most essential. It is highly recommended that small business owners have a separate account for their business and their personal expenditures. If they are co-mingled, it could create legal and financial issues.
Plus, a business account adds credibility to the enterprise and gives it a look of professionalism.
Business checking accounts also make it easy for a line of credit to be attached. Utah Central offers this option. This helps the business cash-flow and protects against large or sudden withdrawals due to product returns or other charge-backs.
Utah Central is a certified SBA lender offering some of the most basic and popular small business loan programs. We also provide loans designed to help the borrower grow his or her business and create jobs. All our loans are tailored to the needs of a specific business -say a restaurant, dry cleaning operation or tire store for example – so you get exactly what you need.
Check with your financial institution for the types of SBA loans available.
(Note: Background information about SBA 7(a) loans) are the most basic and most used type loan of SBA’s business loan programs. Its name comes from section 7(a) of the Small Business Act, which authorizes the Agency to provide business loans to American small businesses.
(Note: Background information about the SBA’s 504 program) The U.S. Small Business Administration’s 504 program is intended to create jobs based upon a formula that has been modified several times over the years. Particular preference is given to rural, economically disadvantaged areas and minority and female applicants for which SBA may waive the job creation requirement. The loan proceeds must be used to finance long-term assets such as real estate and fixtures which makes the program ideal for construction, for expansion of manufacturing facilities and other job intensive structures.
For more information, you can contact a professional at your nearest Utah Central Credit Union branch. To find a branch near you, visit, www.utahcentral.com