And why we didn’t do it earlier.
Wells Fargo is likely the “great bank” among the big ones, with the highest integrity and the lowest tolerance for bad banking practices among the bigs. But if my experience is typical as I believe it is, that should scare us all.
In early 2009 Wells Fargo took away our business credit line without so much as a letter to tell us why – it just vanished from our online banking screen one day. We had used it sporadically to fund purchases and paid it off each time.
IT’S ALL ABOUT THE BANK
We called and they sent a non-personal form letter saying our credit was bad. We went in and showed our branch manager our perfect credit and our local Wells Fargo Branch manager said:
“Frankly, we took away everyone’s business lines with no regard for their credit. We just had to make our own balance sheets look better.” That honest Wells Fargo manager went on to say that their credit requirements had tightened to the point of being ridiculous.
We also regularly heard from other business owners who had switched to using their personal credit lines and had their interest rates jacked up right AFTER using them, not before. To see what would happen, I put a few thousand temporarily on our unused personal credit line and sure enough, within a week our rate was jacked up, too. All while Wells Fargo was receiving the lowest interest rates from the Feds in history.
This is the great bank, the good one amongst all the bad ones. If this lack of integrity is the good one, what are the bad ones like?
We told our Branch Manager we were leaving and were looking for a small local bank that wouldn’t make macro-decisions that ignored their customers. We also told them we would wait until our revenue was significant enough to make Wells Fargo stand up and take notice.
We grew 42% in 2009, 110% in 2010 and are on track to grow another 120% in 2011 and go international. Now that our leaving will be noticed, we’re looking for a small local bank. When we meet with Wells Fargo to move our growing account we hope they’ll learn from our experience, but based on their disregard for us as a client, we’re not holding our breath.
Will the small banks do better? We think so, but we certainly think we’ll have a better chance as a big fish in a small pond.
Our lesson? Go local whenever possible. It’s not a panacea, but it can never be worse and more than likely a local bank, as with any local business owner, is more likely to pay attention because they live there, not in some skyscraper 1,000 miles away.
What’s been your experience with big business vs. small business?