Discuss the advantage and disadvantages of commercial banks
Answers
Disadvantages. Commercial banking or business accounts are often more expensive than traditional bank accounts. ... Depending on the size of your business, some of the services offered may not be needed, and you may still be charged for the services even if you're not fully using them
Advantages
Commercial banking can help your business by making it easier to manage day-to-day financial tasks. An established commercial account with a bank will make it easier to borrow money when you grow your business. Often you are assigned a representative who works directly with the company to find the best services and solutions for the issues the business is facing. For example, the company may save money by outsourcing payroll processing. Banks also offer invoicing services, with personalized invoices, and can set up transfers to other banks which will simplify accounting procedures.
Disadvantages
Commercial banking or business accounts are often more expensive than traditional bank accounts. Banks may charge fees for night deposits, for processing a certain number of checks and for the payroll services. Depending on the size of your business, some of the services offered may not be needed, and you may still be charged for the services even if you're not fully using them. Different banks may offer different services and charge different fees, and it can be difficult to compare the services. Signing up for a commercial account before your business is ready for one will cost you and may slow the growth of the business. If you choose the wrong bank, you may have a difficult time opening a new account and transferring all of the services to another bank. This can cost you both time and money.