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Big banks continue to suffer from a negative image in the mind of the general public. A recent study shows that financial institutions rank at the top of the list as the least trusted sector of the American economy.
The result is not surprising. After receiving over $700 billion dollars in taxpayer money in late 2008, banks tighten their underwriting standards and literally stopped lending money. At one time, there was a steady flow of negative headlines like Bank of America’s ill-fated plan to implement a new fee on debit card transactions and charges that banks were charging customers excessive overdraft fees.
This led to a number of people moving their money to credit unions and local banks. Many people have discovered the advantages of getting credit cards from their local banks.
1. Same services at lower costs
People who would like to take their financial support of local banks to the next level should consider getting credit cards and transferring the balances. Many community banks offer lower interest rates than some of the bigger institutions. They also have rewards programs, including cash back benefits.
The cards may also include perks like purchase protection and car rental insurance. Local banks tend to be more flexible. Small banks also put a premium high-quality customer satisfaction–something that most “big” banks only dream of.
2. Your patronage helps support the local economy
The majority of new jobs are creating by small businesses. Many of these entities depend on small, local banks for business financing. In fact, small and mid-size banks make of less than 25 percent of all banks assets, but they account for more than 50 percent of all small business loans.
Only 18 percent of commercial loan portfolios for the 20 largest banks—with 57 percent of all bank assets– consist of loans to small business owners. Getting your credit cards from community institution support them so that they can help sustain your community.
3. Local decision-making
The approval process for credit cards small issued by local banks is made by professionals who are also residents in the community. This increases the likelihood of bankers understanding the needs of businesses in their areas. Bankers also established face-to-face relationships with customers who are interested in obtaining credit cards from their institutions and other services.
4. Help build community
The success of local banks is inevitably tied to the fortunes of the community they serve. These banks are usually intimately involved in the community in which they operate. When a community flourishes, local banks also thrive. By obtaining your credit cards from community bank, you play an important role in the financial well-being of fellow residents in the community as well as small businesses in the area.
5. Support good financial products
In recent years, big banks have veered away from their traditional products. These institutions cater more to the needs of global corporations and wealthy individuals—creating and investing in high-risk products. Conversely, small community banks focus on providing mortgages, car loans, business loans and low-fee credit cards. Local banks make productive investments, which return greater economic and social value to the community.