A notable trend during the last couple of years is the change in customer preferences towards big banks. Namely, customers are starting to bank with smaller banks or local community banks. Because they choose not to bank with big banks, they are taking their money away from the big national banks. This trend is evident in the period after the last financial crisis.
But the question is whether this is a smart move or not. Should customers bank with big banks or transfer their money to a local community bank? What are some of the reasons to bank with big banks?
Banking with big banks offers certain advantages over smaller community banks. Some of the reasons to select a big bank are listed below.
- Developed ATM network
It is obvious that because of the scale of operation of big banks, they have a better-developed network of ATMs and branches as well. You can find ATMs of some big banks all over the country. The difference in the number of ATMs and geographical coverage is obvious. You can use an ATM of a big bank all over the nation, while this is not the case with a local community bank.
- Developed branch network
Another reason to bank with big banks aside from the ATM network is their network of branches. Big banks have a well-established network of branches in which they offer their products and services. The difference is more than evident if we compare, for instance, the number of branches of Bank of America and Oak Valley Community Bank. According to the information regarding the number of branches, the Bank of America branch network is composed of 4639 branches, while Oak Valley Banks has 17 branches.
- Implementation of the latest technology
Big banks have the resources and strategy to follow the latest technology. The sheer size of big banks and the level of resources they have enables them to digitize their services. Local community banks most often have a limited amount of resources and a limited size of customer base (locally). Meaning that investments in costly technological solutions may not be justified. Therefore you are not enjoying the benefits of technological advancements with local banks. It should be noted, though, that this should not be taken for granted because there are some smaller banks that have been following technological developments.
- Diversity in product offerings (wide assortment of financial products and services)
When banking with big banks, you have a better chance of finding adequate financial products or services. Because of the scale of operations and the number of customers, big banks are able to create versatile product offerings. Unlike local community banks, it is profitable for banks to develop different types of products. Local banks, on the other hand, may not be able to offer specific products or custom products because the demand for these products is limited.
There are many reasons to be banking with big banks. You should choose the type of bank in accordance with your personal preferences for financial products and services. In addition, don’t forget to take into account your lifestyle before you decide on the type of bank. This is in the sense that if you are a regular traveler, it may be a smart move to go with the big banks because of their geographical coverage. Moreover, if you often move, then banking with a local bank will mean that you have to switch banks each time you move to a new location.