An Open Letter to our Business Bankers
As a trusted advisor to your small business customers, you never want to be the one to say “No”. Nonetheless tightening regulation is making “No” an increasingly common answer. “No” your company is too early to receive bank lending, “No” the facility size requested is too small, or “No” we can’t work with companies with historical losses.
In hopes of obtaining some source of financing, small business owners are moving from bank to bank. The response, however, is almost always the same - rejection. Businesses are left with no solutions, and you are left with no future relationship. Even worse, today there are “quick” options that come at extremely high costs and with less than opaque terms often throwing small businesses into a downward financial spiral of which they can’t recover. By ending a conversation at “No” or “Not now” you are unloading your potential client to the market without the know how to help them navigate it.
The question is: How do you say “No” and still convert these SMEs into a pipeline of future business?
At the risk of stating the obvious - being their banker is more than just providing credit. The best bankers know that banking is about providing service in all aspects of a client’s business and finances. While credit may not be available for them today, educating them on their options and steering them in the right direction can win you a client for life. Of course there are the short term rewards that come from deposits and treasury management, but owning that relationship in the long term will yield credit opportunities, referrals, and the ability to grow with your clients over time.
Dwight Funding is on a mission to educate the banking community on responsible funding options outside of the bank. We urge you to arm yourself with the information that your clients need - what are the options below $5million in funding, what are the pitfalls, who are the bad actors to avoid, and how do you plan a path forward that solves near term funding needs responsibly. We are committed to help answer these questions, as well as to be a part of the solution.
Helping these companies navigate their funding options is not just good for business and good for our economy, it ensures that you turn the “No” conversation into a relationship that will continue to pay dividends. Let us be your partner in equipping small businesses with the education and funding options required to position them, thus you, for future financial success.