Updated: July 22, 2021
Are you planning to open a bank account? If so, then the first crucial step you need to take is to determine which bank is the appropriate one for you.
There are so many banking institutions available nowadays that choosing the best one can be a bit confusing.
However, this process need not be complicated. All you need to do is to answer the following guide questions and I’m sure you’ll be able to easily choose the right bank in no time.
What type of bank do I need?
In the Philippines, there are basically four types of banks – commercial, digital, thrift, and rural banks. List down the reasons why you need to open an account and check if the bank of your choice satisfies your current requirements.
There are other classifications and sub-categories of banks but in general, these three cover the products and services that you typically need:
Commercial banks provide services such as accepting deposits, offer financial investments and loans. Their products are usually geared towards the needs of businesses and corporations.
Digital banks provide the highest interest rate, but they’re purely online or mobile. Their products are limited to online transactions such as fund transfers, paying bills, online investments, and loan applications.
Thrift or Savings banks are focused on cash deposits and originating home mortgages. They help individuals and families to plan a stable financial future.
Rural banks help rationalize the development of the regions by financing projects that support agricultural progress in the country. They usually offer high-interest yields for deposits and investments.
Where is it convenient for me to do my banking?
Opening an account with a digital bank is the most convenient because you only need a smartphone and an Internet connection. But not everyone is at ease with having a purely online bank account.
If so, then the bank’s location would now be a primary consideration in your selection process. Open your account in a branch that is accessible to you. It may be near your home, your office or in a place, you often pass by or visit.
Evaluate your daily activities and check if a visit to the branch can easily be incorporated within your usual schedule. The days of operation and banking hours is also an important matter to study.
If you’re typically busy during the workweek, it might be wise to open an account in a bank that’s available during weekends or those that offer telephone and online banking.
Moreover, you might want to consider the number of branches and automated teller machine (ATM) locations of the bank.
Is the bank’s rates and fees acceptable to me?
Go to your desired branch and ask their new accounts officer to orient you with their policies, rates, and fees.
If you’re planning to open a savings account, for example, it would be important to see if the required average daily or maintaining balance is acceptable to you.
It’s also essential that you become aware of their penalty charges and other fees so you can compare them with other banks. Choose the one that’s fair to your judgment.
What are the products and services that the bank offers?
Evaluate your short-term and long-term goals as well as your other financial requirements.
Check if the bank has the products and services that you need or might need in the future. For example, if you’re planning to invest in the money market, it’s appropriate to ask them what investment products they can offer you.
Or if you frequently use shopping apps or you have an account with an online broker, then inquire about their policies regarding online transactions.
Recently, I went out and asked several bank managers about this, it’s unfortunate to discover that out of five, only two of them actually knew about the apps that I frequently use and they’re unsure if I can transfer funds with them.
How’s the customer service?
Digital banks typically don’t have in-person customer service. So, if this is important to you, then a digital bank might not be for you.
For opening an account in banks that have a physical location, here’s a suggestion: when you’re inquiring, don’t go in business attire. Dress down and wear something casual.
I usually go to the bank in walking shorts, a plain shirt, and sandals and check how the bank officers treat me. There should be no sign of discrimination between you and the others who look “more corporate”.
Observe how the tellers interact with the clients especially during busy times. Do they remain pleasant and courteous?
Lastly, you might want to solicit feedback from other depositors, especially those you know, about their customer service experiences in their banks and ask for recommendations.
Is your money safe in this bank? Do you feel safe in the bank?
To strengthen public confidence in the banking system, the Philippine Deposit Insurance Corporation (PDIC) requires all banks to provide deposit insurance coverage of up to P500,000 per depositor. Verify if the bank is a member of PDIC.
Furthermore, you might also want to consider the stability of the bank. Ask questions such as how long has it been in service? Who are its major clients? More importantly, check the security setup. Is the branch located in a safe area? Are the security officers alert?
Banking is one of the basic and most common errands we do in our lives. As such, it’s only appropriate that we consider where we do our banking.
Choose the right bank and they will not only meet your financial requirements but will also become your guide and reliable partner in your journey towards financial freedom.
How about you? Where do you do your banking and why did you choose that bank? I hope you can share some more insights on how to choose the right bank.