More Small Businesses Are Pulling Their Accounts Out Of Big Banks
Even in a tight credit market, David Meinert didn’t think he’d have a problem getting funding from his bank. He was a model entrepreneur, with good credit and a profitable business earning $2 million in revenue. But when he applied for a relatively small $50,000 line of credit from Chase in late 2010, he got denied in 12 hours, with no explanation. “It was insulting and made no sense, even to the banker. And there was no one to even talk to about it,” Meinert says. “It’s frustrating that banks are getting billions of dollars in taxpayers’ money and they’re sitting on that money and not lending it to small businesses. If you’re making less than $10 million, they don’t care about you.”
Meinert decided to turn his frustration into action. After 12 years with Bank of America and a year with Chase, he’s switching all his business accounts to Seattle Bank. Like many small-business owners, he initially joined the big banks for no particular reason other than that they were conveniently located. Bank of America was the closest bank to his office and Chase was the closest bank to his office that wasn’t Bank of America. He spent years enduring all the subsequent irritations — outdated online banking systems, the revolving door of bank employees, increasing fees, a sense that he was more a number than a name — with little more than an eye roll. But the credit line denial was a breaking point.
The practical incentives were compounded by his philosophical objections. “Occupy Wall Street and Bank Transfer Day really put a highlight on national issues for me,” Meinert says. “So it’s not just a practical business decision, but also a societal, political decision. I don’t want to do business with companies that are risking people’s money in a way that can harm our whole country. And the damage that the big banks and so-called Wall Street have done to our economy and our country — it’s a real thing for me. I see it. The people it’s damaging are my customers and my peers. Purely as a businessman, I see the destruction of the middle class and the inequality that’s being caused in our society as bad for business. But also as a human, outside of being a businessman, I see the damage it does to humans. I realized I needed to be out of that system as much as I can be.”