Who could forget the advice-expert twin sisters Dear Abby and Ann Landers? Born in 1918, the advice columnists’ real names were Esther Pauline Friedman Lederer and Pauline Esther Friedman Phillips. In 1955, Esther replaced the original author of the “Ask Ann Landers" column in the “Chicago Sun-Times.” Pauline helped her, but the newspaper shut the partnership down, so Pauline, as Abigail van Buren, started her own advice column, “Dear Abby.” The two were rivals for a time, but by 1993, Ann Landers was the world's most widely syndicated columnist, appearing in 1.2K daily newspapers with 90MM readers. While anyone can give advice, those who build careers around helping others navigate trials and tribulations are the trusted ones we turn to. Those established advisors have something in common with the Independent Community Bankers of America’s Top Lenders of 2024 — they are also sought out for their valuable advice. The key difference is the type of entity asking for advice. Some of these top community financial institution (CFI) lenders are sharing their lending philosophies and how their crucial roles in guiding business customers set them apart. Live Oak Bank. This Wilmington, North Carolina-based CFI was founded to serve veterinary practices across the country, armed with staff who understand how to successfully run the business side of this niche practice. “Nobody knows more about how to run a vet clinic than our guys in terms of staffing and metrics and this and that,” says CEO and chairman Chip Mahan. The son of a veterinarian, Mahan knew the business and how to bring together key players. Now, in-house expertise teams up with lenders to provide more holistic services that translate into success for both vet customers and the CFI. Live Oak Bank has expanded its in-house expertise to now serve additional industries, including funeral homes and independent pharmacies, with both loans and advisory services to make their businesses thrive.BTC Bank. This Bethany, Missouri-based CFI advises its ag customers on ways to overcome the uncertainties of Mother Nature through strategies like forward pricing (setting a price for a crop to be delivered later) and crop insurance. “We provide support in many different ways,” says CEO Doug Fish. BTC’s focus on youth, agriculture, and community provides support for customers throughout Missouri and Iowa.Spring Bank. Founded in 2007, Spring Bank, a South Bronx-based community development financial institution, serves small business customers who often get overlooked by large banks, including small retailers, mom-and-pop shops, and nonprofits. “I can tell you firsthand that our clients and customers are not borrowers that fit into checkboxes,” says CEO Akbar Rizvi. “We’re not afraid to roll up our sleeves and get into the weeds in terms of what the request is.” Rizvi credits his staff’s open-mindedness for their ability to support small establishments like a local jazz lounge that struggled after COVID-19 hit. Thanks to Spring Bank’s support, the club is thriving and doing more business than before the pandemic began. Advice and GuidanceAll of these CFIs get it: small businesses want more than just loans and deposit services — they also want guidance. Indeed, 76% of small businesses are interested in receiving advice from their primary financial institution, according to the J.D. Power 2023 U.S. Small Business Banking Satisfaction Study. The study showed that while small businesses are overall more optimistic than in the previous few years, conditions are still challenging, with 55% percent citing inflation as a negative impact on their numbers.
Small businesses are looking for three main types of guidance from their CFIs: minimizing fees, managing spending and savings, and improving credit. CFI customers who receive advice are not only likely to rate their FI more highly, but they are also likely to buy more products and services from the FI — and also recommend the FI to others, says Paul McAdam, J.D. Power’s senior director of banking and payments intelligence.“Providing advice is a fantastic opportunity for banks,” McAdam says. “Small businesses that receive advice also are more likely to apply for credit, report better approval rates for new credit and are more likely to use services like cash management, lines of credit and wealth management with the bank. Customers who receive advice are generally a bank’s best customers.”CFIs that want to be successful at lending should also offer in-house expertise to help their business customers grow, as well as digital tools and educational resources to provide additional guidance along the way. By giving small businesses one-on-one advice about financial topics like fees, cash flow, and credit, CFIs can build lasting relationships and grow their client base.
Small businesses are looking for three main types of guidance from their CFIs: minimizing fees, managing spending and savings, and improving credit. CFI customers who receive advice are not only likely to rate their FI more highly, but they are also likely to buy more products and services from the FI — and also recommend the FI to others, says Paul McAdam, J.D. Power’s senior director of banking and payments intelligence.“Providing advice is a fantastic opportunity for banks,” McAdam says. “Small businesses that receive advice also are more likely to apply for credit, report better approval rates for new credit and are more likely to use services like cash management, lines of credit and wealth management with the bank. Customers who receive advice are generally a bank’s best customers.”CFIs that want to be successful at lending should also offer in-house expertise to help their business customers grow, as well as digital tools and educational resources to provide additional guidance along the way. By giving small businesses one-on-one advice about financial topics like fees, cash flow, and credit, CFIs can build lasting relationships and grow their client base.
