Why consider a building society for your business savings account?

If you're in the driving seat of the business' cashflow, you may have considered opening a business savings account. Or perhaps you already have one.

As well as earning interest on surplus cash, separating your savings from your daily operational funds can make it easier to manage cash flow.

Many businesses take out a savings account with whoever their business bank is with, simply for ease. And we understand that. When the to-do list is growing and your inbox is hitting triple figures before lunch, the convenience of staying with your present bank can be tempting.

There’s not necessarily anything wrong with this, but taking the time to find an account and provider that best fits your needs is well worth it - and that includes looking at building societies.

While banks and building societies are both financial institutions, they operate slightly differently. High street banks may tend to grab the headlines, but there are several reasons why a building society could be right for you.

Meeting your ESG goals

There’s an increasing pressure on businesses to be good corporate citizens. But while you may start with the best intentions, the reality can be more challenging. Perhaps you’ve put out the recycling bins, switched to electric vehicles and now you’re all out of ideas? Paying attention to where you put your savings is one way to have a positive impact on your community.

As building societies are owned by members, not shareholders, there are no dividends to pay. As a result, most building societies allocate some of their profits to projects or charities in the local area in which they serve. This could be anything from funding wildlife conservation to supporting local youth programmes.

We’re living in an age where every decision - from who you bank with, to where your printer paper comes from - says something about your values. If you’re serious about walking the walk, choosing to put your money where it can help to support worthwhile causes is a good first step.

Better access to in-person services

It’s not just about the feel-good factors either. There are practical benefits to saving with a building society too.

The number of bank branches in the UK has been not-so-steadily declining in recent years, with customers being encouraged to use online banking. According to the Building Societies Association, in 2012, 14% of branches in the UK were building societies, this figure is now 35%.

For many transactions, going online is absolutely fine, but there are times when it can be really helpful to talk to someone face-to-face. Building societies are digitalising, but they also understand the importance of personal interaction. Some, like us, continue to open new branches.

Saving with a building society can mean your business savings don't just work for you but also support people in local communities that value access to cash and a face-to-face service.

And if you value personal service, a familiar face, or just the option to pop in and talk through your business finances in person, that can be a big win.

Have your say

Societies work in a slightly different way to banks. Because they’re member-owned, input and engagement from members is actively encouraged. You get more of an opportunity to voice your opinion on how the society is run than you would with a bank.

Members are invited to attend Annual General Meetings where they can ask questions, learn about upcoming plans and vote on decisions regarding the future of the society (and maybe even enjoy a slice of cake and a coffee!)

To give you an example of what this might include, directors have to be elected (or re-elected) and you’ll also get the opportunity to approve financial statements - a welcome level of transparency for many businesses. Any major structural changes (such as merging with another society) would also need to be approved by members first.

Whether you choose to save with a bank or a building society will depend on your company’s circumstances and needs, as well as the savings products available. But, if you’re looking for a financial institution with a community-driven approach, where you can influence decision making, a building society may align well with your firm’s values and financial goals.

Alex Austin is Head of Customer Proposition, at Suffolk Building Society, with responsibility for creating personal and business savings accounts.

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