The gap between traditional banks and digitally native alternatives is widening. According to research, legacy financial institutions spend as much as 30% more on operating costs due to outdated technology and processes. Unfortunately, those costs are often passed directly to customers.
Hidden fees, poor conversion rates, expensive transfers. If you’re in e-commerce, you can’t afford to let bank fees eat away at your margins.
You need powerful financial tools that get your cash across borders and into your suppliers’ hands quickly, with the friendliness and ease of popping into your local bank branch for help.
In this article, we’ll explore why more sellers are choosing to partner with banks and lenders who understand how modern commerce works.
The Problem With Traditional Business Banks
Strange as it may sound, big banks almost seem to want to punish growing entrepreneurs.
Today you can find hundreds of business owners airing their frustrations on Reddit as they set out to find a better banking solution. From terrible customer service to hefty hidden fees, many are simply done with big banks.
But unfortunately, they’re not finding real alternatives to replace them with.
Merchants are forced to use multiple banks to keep their cash safe, funds flowing, and margins strong. Some even report turning to iffy alternatives who freeze access to their funds without warning or explanation.
No matter your niche or business model, the core dilemma is often the same: risk it all with the big banks, or cobble together a portfolio of (sometimes sketchy) accounts to meet your needs.
With multiple suppliers in multiple countries, you don’t have time to constantly switch accounts to avoid high conversion rates and exchange fees. You need one place for low-fee global payments, fast and affordable transfers, and great customer service.
What to Expect From an E-commerce Banking Partner
At a traditional bank, archaic processes mean everything moves at a glacial pace, making even the simplest transactions slow and expensive.
Unlike traditional banks, fintech companies were born agile. With less legacy bureaucracy baked into their processes, you can expect lower fees and transparent terms. The result is a leaner, all-in-one solution for your e-commerce banking needs.
But first, you need to know what to look for. Here are some of the most important features to consider when selecting an e-commerce banking partner.
1. Free Transfers
Traditional banks may charge as much as $50 for a single international wire transfer, with median fees sitting around $15-25 for domestic and $15-45 for international transfers. Add overdraft fees (of up to $35), registration fees, and monthly maintenance fees (up to $25 or more), and you’re looking at a significant dent in your margins.
Instead, look for a partner that offers no-fee business checking, with zero registration fees, overdraft fees, or monthly minimums. International wires and ACH transfers should also be fast and free.
For example, SellersFi’s Business Checking solution has no minimum balance requirements and absolutely no monthly fees. Transfers, incoming wires, and even checks sent in the mail are processed without any cost to the account holder.
2. FDIC Protection
The Federal Deposit Insurance Corporation (FDIC) is a federal agency created by Congress in 1933 to restore confidence in the US banking system after the Great Depression.
Now, the FDIC insures deposits of up to $250,000 per depositor, as long as they’re made with US banks and institutions that are member firms. FDIC insurance can prevent crisis scenarios like bank runs and protect customers in the event of a bank failure.
When working with a fintech provider, some business owners worry that they won’t be protected by the FDIC. But many e-commerce financing partners do offer FDIC coverage.
At SellersFi, all Business Checking accounts are insured through Five Star Bank, an FDIC member firm. This ensures the same standard FDIC coverage limit as major US banks, so you can rest easy knowing your funds are secure.
3. Global Payments In Any Currency
Traditional banks often have high fees for foreign wire transfers. And unfortunately, that’s not where the price hikes end. When you start adding intermediary fees and costly foreign exchange rates, doing business internationally becomes even more expensive.
Most banks set their own foreign currency exchange rates loosely based on the mid-market rate (MMR). While these rates are certainly better than changing money at the airport, they’re still much higher than what the government or market dictates.
On top of that, many banks also charge a flat or percentage-based commission or fee to exchange currency. This fee could be as much as 3% or $15-20 per transaction.
But selling across borders is business as usual for modern merchants.
The right e-commerce financing partner will make it simple and easy to both send and receive global payments. Look for exchange rates that are close to the real MMR and the ability to pay suppliers directly in their preferred currencies. Terms should be transparent and easy to understand, with no unexpected fees.
4. Fast Account Setup
Depending on the bank, it can take 7 business days or more to open a business checking account. Even in the quickest cases, you could end up spending hours on an in-person visit, just to set up one account.
While some large banks now offer online applications for business checking accounts, legacy technology and processes can still mean frustratingly vague status updates, while you wait days to find out whether you’ve been approved.
Without the red tape, an e-commerce financial provider can get you set up with a new business account in as little as 10 minutes.
At SellersFi, we offer live customer service to walk you through the process from anywhere with an internet connection. You can also set up as many accounts and sub-accounts as you like to support your accounting needs.
5. A Partner Who Gets It
Customer service at traditional banks is a nightmare — if you can get it. More often than not, you wind up on hold for hours, committing the latest Muzak banger to memory.
When you finally reach a human, support often feels cold and corporate. Some reps will try to upsell you on products that aren’t even relevant for your business.
Many early-stage e-commerce founders get around these frustrations by working with local banks and credit unions, but these institutions don’t often have the banking power you need to scale to national or international success.
Multiple accounts also means multiple customer service reps to chase down. To protect your time and energy, you need one dedicated account manager who knows your business and is ready to assist with all your banking needs.
Why SellersFi?
At SellersFi, we’ve been there.
As a fintech company purpose-built for e-commerce, you’ll get a team of experts who understand your vision for the business — dedicated account managers who know exactly who you are and how you operate.
Business Checking accounts come with zero monthly charges, no minimum balance, and no hidden fees. And with fast, no-fee transfers in 37 currencies, you’ll have everything you need to scale your business across borders.
Already using our Working Capital and Digital Wallet? Access all your financial tools from the same user-friendly dashboard, with unlimited physical and virtual debit cards for you and your team.
With banking solutions designed for and by e-commerce entrepreneurs, SellersFi is a partner you can count on. But don’t take it from us. Read our reviews to find out exactly what our customers think, or join the waitlist and be among the first to access our no-fee business checking solution.
