Making the most of the service you receive from your bank is an essential part of any nursery business. It's worth investing the time to manage your relationship and check periodically that you're receiving the best offer available.
TOP TIPS:
- To help compare the services and rates on offer, visit www.bba.moneyfacts.co.uk. This can provide a quick and easy comparison of most banking products. Remember to consider all elements of your financial needs before making a decision. Are you receiving a good deal on your current account but a poor rate of interest on credit balances? Would it help to invest your funds elsewhere, or would that influence your borrowing rate?
- Make sure that you investigate all finance options and don't just rely on overdraft borrowing. It may be more economical for hard-core borrowing on overdraft to be transferred to a short-term loan.
- If you have credit balances, make sure they work for your nursery. Taking time to transfer surplus cash to a higher-level interest-bearing account can have an impact, even over short time periods.
- Obtain clear explanations of all the costs attached to the product you're using. For example, is there an early repayment fee attached to your loan?
- If you're benefiting from an introductory offer, consider any 'tie-ins' and make sure you revisit your position once this period has expired.
- Always check your bank charges and interest payments. Small businesses can find help to do this at www.bba.org.uk. If you are dissatisfied, then contact your bank immediately.
- Keep bank charges to a minimum by avoiding unauthorised overdrafts, reducing the amount of cash paid into the account and automating as many transactions as possible using standing orders, direct debits and electronic payments.
- Inform your bank of any plans or changes in circumstance no matter how short term. Requests for finance are viewed more favourably if your manager is aware in advance.
- Finally, if you accept a cheque from a parent that is returned unpaid, your bank may charge you. Consider incorporating a right to recover this fee within your parental contract.
