The basics of treasury management for SMBs

Small-business owners typically have more than enough to get done on a daily basis, but not nearly enough time in the day. They’re often pulled in all different directions, which can make it difficult for them to dedicate the time and attention needed for effective treasury management.

Businesses are built to make money, but what do you do once you have all that cash? The task of managing business finances can be an endless stream of capital planning, vendor payments, wire transfers, payroll, cash flow and accounts receivable.

The more tools a small-business owner has at their disposal, the more efficiently they can tackle all these cash management considerations, reducing the risk of manual mistakes and leveraging the time and cost savings of automation.

Interested in exactly what tools can help businesses improve their treasury management? While our ebook Treasury Management 101 for SMBs has a few more answers, we’ll use this blog to take a brief look at the products and services from Bank Midwest that can help.

What is treasury management?

But first, a bit of clarification. Some SMB owners and leaders may be confused by the use of “cash management” and “treasury management,” which can cause confusion.

In reality, there is no difference between the two. The terms are used interchangeably to refer to the various fiscal responsibilities of a commercial operation.

At a high level, treasury management entails everything from making ACH payments and payroll to receiving online customer payments, paying credit card statements and managing overall business cash flow.

Practically, that means a lot of money moves in and out of the company, and owners need tools that give them control, transparency and accountability — especially because fraud prevention is a big part of effective treasury management.

Without further ado, here are some of the top tools and services (all available from Bank Midwest) that can help SMBs improve their treasury management practices.

Web payments and merchant card services

To make money, your business needs ways to capture revenue. Web payments and merchant card services ensure your organization can accept various forms of consumer payments. After all, customers rarely pay with physical checks (as opposed to business vendors, who may be more apt to use checks), instead relying on debit cards, credit cards and digital wallets.

Web payments can help your business improve its e-commerce strategy. As more customers flock to online buying, your site will need to be fully equipped to accept digital payments. Web payments from Bank Midwest can:

  • Streamline the online checkout process for customers.
  • Increase the efficiency of your backend processing.
  • Ensure transaction security and compliance.
  • Export payment data to accounting software.
  • Allow you to accept recurring charges drawn from consumer checking or savings accounts.

Though there is considerable potential in e-commerce, businesses shouldn’t neglect their in-store payment technology. In particular, they need mobile point-of-sale solutions. More consumers are using mobile to pay at the register, and a modern merchant card POS tool that accepts credit, debit and EBT payments can help you save up to 40% over check payments.

Business credit cards

It’s unlikely that any small business can sustain itself running entirely on a cash budget. Credit has a central place in capital planning, and many businesses leverage credit cards in regular operations, whether to buy inventory, make spot purchases or plug short-term cash flow gaps.

In your search for a suitable business credit card, you should focus on points like:

  • Interest rate.
  • Credit limit.
  • Daily limits.
  • Annual fees.
  • Cashback rate.
  • Rewards.

Bank Midwest has several Visa business credit cards to choose from, and which offer free online expense reporting, zero fees for additional employee cards and 24/7/365 cardmember services, among other features.

Sweep accounts

Some SMB owners may be unfamiliar with sweep accounts, which can be a major advantage for companies.

It works like this:

  1. A business owner decides a minimum range for their primary operating account.
  2. At the end of the day, any funds over that minimum are swept into a separate account.
  3. There, the money can earn interest, be invested in stock or a money market account, or be used to pay down an existing credit line.
  4. If the operating account is under the minimum, funds are automatically swept back in.

Basically, it’s a way for owners to automate what would otherwise be a tangle of time-consuming transfers — giving them full opportunity to capitalize on short-term investments.

Simplified account transfers

Considering the frequency of account transfers that SMBs handle on a daily basis, any way to make the process more efficient would return valuable time and labor resources.

Traditionally, to complete an account transfer, an owner or employee would have to visit a branch and write out deposit slips for each transfer.

However, with cutting-edge cash management solutions from Bank Midwest, SMBs can significantly simplify the transfer process. You can initiate a transfer online if the accounts involved are with the same bank as your principal business checking account, plus you can more quickly complete ACH transactions without painstakingly tracking full numbers and routing information.

Fraud prevention

You don’t want to mess around when it comes to your money, so be sure your business has ample fraud prevention tools it can use to protect its finances.

Bank Midwest understands the importance of robust fraud prevention and can provide our business banking customers with defensive measures like:

  • Positive pay: Match presented checks to previously authorized check payments to quickly verify authenticity.
  • Stop pay: Cancel payment on any number of suspicious checks at once.
  • Multi-factor authentication: Require multiple log-in steps, including username, password and registered token or security question.
  • Dual control: Bank Midwest requires dual control for all ACH and wire transactions as a added security precaution.
  • Permission-based access: Decide exactly what data privileges each employee with access to banking services has.


Ready to take your SMB treasury management to the next level?

Contact Bank Midwest today to learn about our numerous business banking products and services that can help you become more efficient and effective.

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