by. Casey Bond
In a world where banking products with low fees and decent interest rates are few and far between, most bank customers can’t afford to stick with one institution. After all, one bank offering great home loans may not be able to compete with the savings account rates offered by another. Conducting business with multiple banks means taking advantage of more opportunities to save and grow your money.
However, there is something to building a strong relationship with one bank. Just like a relationship between two people implies an expectation they’ll receive a higher level of trust and priority in each other’s lives (in theory, anyway), committing to a single bank can provide many of the same benefits.
Financial institutions often push away unprofitable customers, which means becoming BFFs with just one bank may prove difficult if you don’t have a lot of cash to offer. But those bank customers who actually add to bank revenue — through large deposit and loan balances — can reap numerous rewards from this win-win situation.
What Is Relationship Banking?
Relationship banking refers to the marketing of financial “packages” to customers, rather than one-off accounts or loans. By cross-selling banking products, institutions can increase total assets per customer and subsequently, total revenue per customer.
However, relationship banking isn’t just about the bank’s bottom line and can beneficial to the customer, too. For one, building a relationship with your bank means establishing trust on both ends. Your bank trusts you to meet your financial obligations, and you trust them to meet your financial needs. The stronger the bond of trust, the more financially beneficial that relationship becomes for both parties.continue reading »