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Newer institutions actively pursuing market

Banks increasingly focused on small biz customers

Good news for small business owners: banks are focusing more attention on product offerings for the group that makes up more than half of Mississippi’s workforce.

“Small business lending is such a huge part of the state’s economy that banks, particularly new charters, are pursuing this market,” said McKinley “Mac” Deaver, executive director of the Mississippi Bankers Association. “That’s where the money is. A lot of new products are geared to small business product offerings.”

On Jan. 31, Trustmark National Bank launched a new product, Trustmark Business Advantage, aimed at small business customers, and deployed 37 business bankers statewide to focus on small businesses within their assigned markets, said Donna O’Keefe, vice president of product management.

“It’s a win-win situation,” said O’Keefe. “It’s good for the bank, good for the customer, and it takes us in the direction we want to go.”

Concerned that small businesses might feel somewhat at a disadvantage and lack time to solicit discounts on certain services, Trustmark spent more than a year developing a comprehensive business product that, along with the existing checking-based product, includes options for financial discounts, such as reduced interest rates on credit cards, rebates on debit card purchases, discounts on first trades, overnight shipping, office supplies and travel. Trustmark partnered with several service companies, such as MCI WorldCom, for a communication service discount, O’Keefe said.

“We’re providing a connection through an alliance partnership program to get our customers to people with expert advice to manage those types of services,” she said. “We tallied up a value sheet that showed up to $1,900 a year in savings, a value offset by a minimal $8 monthly fee. We’re providing one-source shopping to meet needs with trusted partners and are the only bank in the state offering small business customers services at a comprehensive level.”

Frank Riley, branch officer of Bancorp South, said their business-based product, Businesscorp, essentially offers the same services but is tailored to small business customers’ needs.

“We sit down with each individual, find out how they’re growing their business and specific needs they have,” said Riley. “From there, we have a business analysis on which we eventually make referrals to connect them with internal departments at no cost to the customer.”

John Arledge of Community Bank said the bank’s “two-day turnaround” program attracts small business customers, and the myriad of different commercial checking accounts, including business debit cards, keeps them there.

“Our ‘two-day turnaround’ allows small business owners to know within two days if a small business loan is approved,” Arledge said. “A lot of small business owners tell us they get tired of making a pitch to a bank for a loan and then having to wait several weeks for it to go through corporate channels. In the meantime, their window of opportunity closes. The timing and the speed of the answer on a loan is very important to small businesses, especially in this economy with so much movement, activity and competition. They need answers quickly and that’s what we hang our hat on.”

In several markets, Community Bank is testing a commercial courier service that picks up paper deposits — no cash — and loan documents for small business customers who lack time and personnel.

“If you ask a lot of small businesses, they’ll say they send an employee to the bank sometimes twice a day,” Arledge said. “That takes the employee away from doing work that needs to be done. Since we operate one office in a community and don’t have a lot of branches, we can pay a better rate to our customers. To make up for the fact that we don’t have a lot of branches, we’re testing this service for small businesses to see how it works. Right now, we’re not testing it as a cost item and we’re the only bank that I’m aware of that is testing this service.”

AmSouth offers the Business Priority Money Market Account with tiered rates. A minimum opening balance of $5,000 is required, with a minimum daily balance of $5,000, or average monthly balance of $10,000, needed to offset a $15 monthly service charge. Customers are charged 25

About Lynne W. Jeter

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