Given the challenges of working with a big bank, manyentrepreneurs are taking a different tack. Instead of wooing thebig commercial institutions, they’re courting community banks,where “relationship banking” is the rule, not the exception. Evengiven today’s banking climate, it’s easier to get a startup loanfrom community banks, according to the Independent CommunityBankers of America. They can be a little more flexible, don’t havea bureaucracy to deal with, and are more apt to make characterloans.
But don’t get the idea that obtaining a loan from a communitybank is a snap. You’ll still have to meet credit and collateralrequirements just as you would at a larger institution. Thedifference: Smaller banks tend to give more weight to personalattributes. If the business is located in town, the banker likelyalready knows the entrepreneur, and the family has lived in thearea for years; these things count more in a community bank.
Whether the bank you target is big or small, perhaps whatmatters most is developing relationships. If you’ve done yourpersonal banking at the same place for 20 years and know the peoplewith authority there, it makes sense to target that bank as apotential lender. If you don’t have that kind of relationship atyour bank, start to get to know your bankers now. Visit chamber ofcommerce meetings; go to networking events; take part in communityfunctions that local bankers or other movers and shakers are a partof. A banker with a personal interest in you is more likely to lookfavorably on your loan application.
