Growth is important to all businesses; for small businesses, it is imperative. Recent research from Hitachi Capital revealed that 67 per cent of SME owners are working on growth plans in the next three months, up from 61 per cent a year earlier.
Employing more staff, upgrading equipment and exporting overseas are priorities for businesses pursuing growth. At the same time, the research found that small businesses are aiming to strengthen themselves financially by cutting costs, improving cash flow and pursuing timely payment of accounts receivable.
Virtual banking can support the growth of small businesses in several ways, both in terms of the services it provides, but also in improving the general efficiency of operations.
Adding employees is made easier, thanks to the ability for virtual bank accounts to support mass payouts – such as salary payments – with the click of a button. Therefore, taking on extra staff won’t mean more time spent on managing payroll. Equally, working with more suppliers won’t significantly increase time spent paying invoices.
Virtual banking is also ideal for businesses looking to expand into new international markets or do more business in countries they already operate in. Transaction fees for international payments are lower than traditional banks, or, in some cases, there are no fees at all. Because virtual banks use the internet to make international payments, there is no need to spend time and money on setting up wire transfers. International payment standards such as SEPA and SWIFT are often adhered to, enabling a range of payment types.
Prepaid payment cards that allow the withdrawal of local currency anywhere in the world with flat ATM fees make it more straightforward for staff to travel and meet new customers and suppliers in other countries.
Virtual bank accounts don’t come with the fees traditional banks usually attach to business accounts. What fees there are tend to be lower thanks to overheads that are lower than banks that have physical branches to run. These savings add up, helping rein in costs.
Lower costs mean more cash available, allowing businesses to spend on upgrading equipment or increasing office space to support an expanded workforce.
In terms of improving cash flow and ensuring prompt payment for goods and services, virtual banking supports rapid payments. While it may still sometimes be necessary to chase customers for payment, the system itself minimises delays when payments are sent.
Growing a small business involves a lot of extra work above and beyond day-to-day operations. Virtual banking eliminates much of the hassle associated with traditional banking, with no need to visit a bank branch, flexible 24/7 customer services hours and a simplified approach to financial transactions.
The use of virtual banking can, therefore, free staff to focus their efforts on recruiting the right people, determining equipment and facility needs, and winning more business to make their growth a reality.