Best Banks for Nonprofit Organizations
As with all nonprofits, churches need to work with a bank so they can receive donations, store funds, and purchase goods and services that the church needs. To ensure smooth financial operations, you need to choose the best bank for nonprofit organizations – one that is experienced with religious organizations.
Read on for our list of the best banks for nonprofit organizations!
Do I Need a Nonprofit Account?
Churches aren’t there to earn money, which is why they’re classified as nonprofit organizations. However, nonprofit organizations still need revenue and money to hold activities and maintain operations. This is why you’ll need a nonprofit account.
Generally, banks apply the same rules for nonprofit and for-profit organizations, with some variations like the lack of dual signatures for high-value transactions and more relaxed reporting requirements.
When you run a church, you need to partner with a bank that shares the same values and holds itself to high social responsibility standards. You don’t want to be associated with banks that perform unscrupulous or underhanded acts to make a profit because it won’t reflect well on your church and congregation.
It’s also important to find a bank that has significant experience working with nonprofit clients and preferably has resources for nonprofit organizations. Many banks with a good history of working alongside nonprofits can provide perks like special accounts and financial literacy training, or even become a sponsor for your church events.
Best Bank Accounts for Nonprofits
The best bank for nonprofit organizations should share their values and give back to the community, just like the nonprofits they serve.
It can be hard to switch from one bank to another if you’ve been working with them for years, so it’s important to do your research and pick the best bank account for nonprofit organizations. Here are some of our top picks for nonprofit banks!
U.S. Bank: Overall Best Bank for Nonprofit Organizations
U.S. Bank’s nonprofit checking accounts waive fees for 1,800 transactions and 300 cash deposits annually. This bank also offers merchant services that can help you set up online donations. Opening an account at U.S. Bank is very easy since you can apply online, over the phone, or at a branch with an initial deposit of just $100.
LendingClub: Best Checking Accounts for Nonprofits
LendingClub offers fee-free transactions and deposits through ATMs alongside a 1% cash back on debit card purchases. It also offers a very low monthly fee of $10, which can be waived by maintaining a monthly balance of $500 or more.
A LendingClub checking account access also comes with Autobooks. This software handles invoices and payments for you, resulting in more accurate financial reporting and making it much easier to manage your church’s finances.
Fifth Third Bank: Best Regional Nonprofit Bank
Fifth Third Bank is one of the best banks for nonprofits in California, boasting zero monthly fees and no minimum balance requirements. It also offers many lending options like real estate loans and lines of credit if you need extra funds for your church.
PNC Bank: Best Bank Account for Financial Literacy
PNC Bank waives all maintenance fees for the first three months of your accounts, regardless of balance. After three months, you just need to have $500 in your checking account to enjoy this benefit.
PNC offers the best bank account for a nonprofit because of its financial literacy program, PNC WorkPlace Banking for Employees. When banking with PNC, your financial team can take various financial literacy seminars and check your church’s financial health with free tools.
Bluevine: Best Non-Bank Alternative
Bluevine is a financial technology company that offers nonprofit checking accounts without minimum opening deposits. When banking with Bluevine through its checking accounts, you won’t be charged any service or overdraft fees. Moreover, all accounts up to $250,000 are insured by the FDIC, so you can rest assured your money is in good hands.
How to Choose the Right Bank for Your Nonprofit
Choosing a bank for your church or nonprofit is a major commitment since you can’t easily switch to another bank. Below are the steps to doing your due diligence:
Examine its Transaction Fees
Transaction fees may seem small at first, but they’ll add up as time passes. Fortunately, many banks offer fee-free checking accounts as one of their benefits. However, you need to double-check the offer since some banks only give you a limited number of fee-free transactions per year.
Ensure Shared Values
As a nonprofit, you have a reputation to keep. Aligning your church with a bank that shares the same values is important because not all banks have stellar reputations – some even resort to underhanded business tactics to make money. Research the bank’s history and note its philanthropic interests so you can find a bank that aligns with your values and interests.
Check its Accessibility
Accessibility is different for every church or nonprofit. If your church staff is on the younger side, you may want a bank that offers robust online support. Conversely, older church staff members may prefer working with a bank that has local branches nearby. Check with your staff to see which type of bank they’d rather work with.
Ask About Additional Services
A business checking account is one of the most important things you need from a bank, but it’s not the only thing. Ask about additional services like loans, new business accounts, donation processing, or even treasury assistance.
When to Use a Local Bank
When researching which bank to work with as a nonprofit, it’s often easiest to sign up with major national banks like U.S. Bank and PNC Bank since their internet presence is already well-established. However, you can’t ignore local banks, either. Despite their smaller scale, many local banks have robust product offerings that may match national banks.
Running a church means you’re expected to be a pillar of the community, and what better way to show it than by banking with local institutions? In addition to supporting your local business, you’ll also get advantages like:
Local banks often lower rates and waive fees so they can compete with larger institutions. Ask how much it costs to open and maintain a checking account at your local bank – it may end up being cheaper than one at a national bank!
Since they’re in the same area as you, local banks are more in touch with your needs. They understand what goes on in your community and what your church does to improve the lives of people in it. If the bank sees that your church applied for a loan to fund community initiatives, they may be happy to help and make the process easier.
One of the greatest benefits of banking at a local institution is that you actually know your banking officer. In fact, they could even be part of your congregation! Because you know each other beyond a professional level, your banking officer is more inclined to recommend helpful bank products you haven’t considered and provide useful tips that save money.
The church and your bank have the same interest: building a better community. Everything you do together builds each other up and will result in a stronger community, from leaving good reviews on each others’ Google Business profiles to partnering up for charity events.
Over to You
Choosing the right bank for your church is challenging. Be sure to weigh in all the benefits that a bank offers to make the right decision. Don’t just look at national banks either – local banks tend to be friendlier and more in tune with your needs.