Nonprofit 411: What A Nonprofit Should Look For In A Bank

Bruce Figueroa - Citizens Bank, BostonA smart bank does more than make loans

By Bruce Figueroa, Head of Not-For-Profit Banking, RBS Citizens

If a nonprofit agency is looking for a loan or a line of credit, there are plenty of banks or financial institutions for the organization to consider.

But a lot of nonprofits are looking for a bank that can do more than just make loans. They are looking for a partner or a trusted advisor they can talk to and plan with to help move their organization to another level over the next two, five, or ten years and beyond.

Regardless of their focus, there are a number of similarities between every nonprofit organization. Colleges and universities, cultural institutions, human service agencies, hospitals, advocacy and environmental groups all have to work within the very specific parameters of a 501(c) 3 tax structure every day of the year. At the same time, given various scopes of work these organizations are addressing, no two nonprofits are the same.

No matter the mission of the organization, a smart nonprofit will engage their banker long before they need their next loan. Before a master plan for a new campus is developed, a capital campaign is planned or an expansion to office space or a new computer system is considered, an organization and their banker should talk about the big picture. An open, honest and transparent conversation will help both sides see that there are often multiple ways to turn a dream into reality.

A smart banker will bring to a nonprofit something besides forms and applications to be filled out. In addition to their time and attention, your banker should share with you a deep understanding of the financial and nonprofit sectors in all their complexity. If you have the right financial partner, your banker will have been through the inevitable financial and organizational turbulence that is part of every nonprofit organization. He or she will have the answers to your questions, and sometimes even know the questions to ask before you do.

The closer and longer both an organization and their banker work together, the easier it will be for both to get – and stay – on the same page.  Fostering a strong and trusted relationship will be truly beneficial to both parties. The deeper the relationship you establish and maintain with your banker will allow you to work through the both the known and unknown challenges and opportunities that you will almost certainly encounter.

So while more than a few banks can offer the conventional products and services to a nonprofit, it is the smart bank that goes the extra mile and provides solutions and not just another loan.

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