5 Things to know about account opening for your SME business

A few tips to keep in mind while deciding the bank to choose for your new business, which most banks refer to as SME accounts.

By NM Partners

It currently seems like the only way to make it in this country is to go into business. But the path of entrepreneurship is in itself filled with obstacles that Sango himself cannot thunder away, from double

taxations to impediments during importation, high cost of doing business, increases in exchange rates and a recession that is keeping people from spending as much as before.

According to the National Bureau of Statistics, small and medium scale enterprises (SMEs) in Nigeria have contributed about 48% – on average – to the national GDP in the last five years. Making a total of about 17.4 million enterprises, they account for about 50% of industrial jobs and nearly 90% of activities in the manufacturing sector, in terms of number of enterprises. Despite the significant contribution of SMEs to the Nigerian economy, challenges still persist that hinder the growth and development of the sector

As an aspiring business owner, one of the few tips to keep in mind is that once you begin your business you may meet daily glitches and even though these disappointments are abundant, some of them can be prevented by making more thought-out decisions before entering into any business. Thinking through the option of registering a business name, whether to find a physical space or become an online vendor, or which bank to use as your service provider.
I’ll be discussing business registration next time, for now I’ll be giving you a few tips to keep in mind while deciding the bank to choose for your new business, which most banks refer to as SME accounts

1. Customer service: You are an entrepreneur in Nigeria, that in itself is wahala enough, you do not need a bank that has terrible customer service or is unable to help you via an accessible channel. Going back and forth with customer service over the phone, waiting for 10 minutes without reaching any bank staff just listening to bad phone music, or needing to know someone who works there personally before you can have an issue rectified are NO NO’s for business accounts. When you visit your current banks, speak to other customers in the customer service section, you will be surprised at what you find out.
2. Seamless transactions: Customers today expect a seamless experience during transactions when it comes to accessing banking services. In Nigeria, it might be a stretch to expect the existence of a bank which doesn’t have any glitches during transaction but it is not too much to want to use a bank with a majorly good history. Nobody wants to constantly hear ‘madam dey don transfa the moni but e neva enta’. You should also look out for a bank that operates seamlessly on multiple devices such as a smartphone, tablet, desktop or physical visit in the bank (short lines at customer service).
3. Business Loans: Figures from recent statistics by SMEDAN show that there are about 37 million micro, small and medium enterprises (MSMEs) in Nigeria, most of these businesses are unable to acquire loans most often because they can’t meet the bank requirements for these loans.
4. Bank Charges: Every bank has different kind of charges that they slap a funny name to and debit you for. For business accounts you should look out for a bank that has a fixed monthly charge, not one that bills you with no explanation. Check out for the fixed charges that banks have that may differ with the SME category (micro, small, medium).
5. Incentives for Entrepreneurs: Business is business but business doesn’t always have to be cut and dry. Very few banks offer support for their SME accounts to entice you to open an account, even few follow through with their promises. Take advantage of what they can offer like SME masterclasses, free e-commerce websites etc