CHARLOTTE AMALIE — Many small businesses begin as a personal venture or idea that is tied to the personal finances of an entrepreneur. But once that enterprise starts to grow, it is important for business owners to understand the benefits of keeping their personal and commercial finances separate.
To help female entrepreneurs in the Virgin Islands make that transition, Popular recently hosted the Popular Business Series Women’s Edition, at the Valentino I. McBean Banking Center in St. Thomas. Some 100 business owners took part in the event on site and online via Zoom.
Linroy Freeman, Commercial Relationship Officer of Popular, shared with the participants six reasons why it is important for business owners to make the commitment to maintain personal and business finances separate.
“The first thing is to protect yourself as the sole proprietor of the business, because your personal assets can be exposed if you are not operating under a proper corporate structure. To minimize your risk exposure if you are faced with any legal issues, it is important to acknowledge the importance of setting up a corporation, or an LLC, for example,” Freeman explained.
Creating a business bank account also establishes a corporate image and credibility to ensure that as you try to solicit new business, your potential customers will want to know that you are organized, and that you have taken the steps to organize your business.
“First impressions matter, and your need to earn credibility with your clients, suppliers and those who you partner with for ongoing support,” Freeman explained.
Setting up a proper financial structure also allows for easy tracking of documents and information; it makes the accounting more efficient and allows you to take advantage of certain tax deductions and benefits that are specific for businesses.
The event also featured Tiffany Gumbs, Assistant Vice President of Operations and Regional Manager of Banco Popular Virgin Islands, who explained “the do’s and don’ts” of business banking.
“As a bank, Popular must adhere to strict regulations, and the first step for us in that process is knowing our customer, so that we can better serve their needs and comply with the necessary steps in the process of setting up an account or loan application,” she explained.
“The first thing you should do is obtain and maintain government registration and licenses for your established business, which is the information needed to set up the account. It is important to build a relationship with your banker so you can feel comfortable maintaining an ongoing dialogue, and you should express your needs to allow your banker to identify financial solutions that will fit you best,” Gumbs explained.
To facilitate all these processes, Monique M. Richards, Vice President and Commercial Relationship and Credit Manager USVI, talked about the business solutions Banco Popular offers its customers to help them make the most of their business finances, including various types of short-term and long-term financing, credit cards and the Mi Banco Commercial smartphone app.