In response to the challenges created by a pandemic induced recession, business leaders are reevaluating their cash reserve strategies. This new environment, exemplified by a recent string of corporate bankruptcies, has shined a spotlight on the need for organizations to maintain a sufficient emergency fund.
As cash reserve needs to grow, it can become difficult for a business to keep the entirety of its cash at a single bank without sacrificing FDIC insurance coverage. And with historically low rates, finding a productive investment for reserve cash can be quite a challenge.
However, our company, the American Deposit Management Co. [ADM], has developed a solution made possible by our proprietary fintech. Our American Money Market Account™ [AMMA™] provides revolutionary enhancements to your current business bank account. With the help of fintech and a vast network of community banks, ADM can offer extended FDIC coverage and the most competitive rates for business cash. This is a concept we call Marketplace Banking™. And, the best part: you keep your current bank.
Enhanced Business Banking Provides Extended FDIC Coverage
Due to the limitations of FDIC coverage, when cash balances at a bank exceed $250,000, then there is a chance that some of those cash reserves are left unprotected. In the event the bank collapses, those excess funds could be lost.
There are ways to extend FDIC coverage, such as opening more bank accounts at different institutions. The problem with this strategy is maintaining accounts at multiple banks can be a time-consuming burden, with numerous relationships and reconciliations to manage. In the past, this wasn’t always worth the effort.
However, our fintech has delivered an advanced solution to this problem. With an AMMA™ account, business deposits are distributed across a network of community banks to extend FDIC coverage beyond traditional limits. To make this simple for your business, you receive a single consolidated statement and have a single relationship to manage. In addition, you will have access to your balances and transfers 24 / 7 via our online portal.
Enhanced Business Banking Equals Next-Day Liquidity
There are other services who can extend FDIC coverage on your business cash, but they come with very important limitations. For example, CDARS can allow your business to extend FDIC protection beyond the traditional limits, but your cash will be locked away in CDs until maturity. This means you may pay fees if you need cash before a CD has matured.
With AMMA™, the days of sacrificing safety for liquidity are over. An AMMA account allows businesses access to various investment vehicles, which can afford the owner next-day liquidity in addition to the most protection and the most competitive return available.
Enhanced Business Banking Equals the Most Competitive Return
Since the Fed’s actions in late March interest rates have been near zero. With little indication that the Fed will raise rates in the near future, insignificant interest rates may become the new norm.
With an AMMA™ account, your business can leverage a network with hundreds of financial institutions who compete for business deposits. This can allow your business to access returns that are higher than market rates. When you work with ADM, the days of sacrificing return for safety are over.
We’re here to enhance your current bank, not replace it.
A relationship with ADM is not designed to be exclusive. We know that the relationship with your local banker is valuable, which is why we do not want you to leave your current bank.
We are not here to replace your bank. We are here to enhance it.
Earn more, risk less® with AMMA™ by ADM
When you work with ADM, our team of cash consultants will understand your needs and develop a strategy to optimize your reserve cash. Our team is our secret sauce, and you will understand that once you give us a call.
At ADM, we take the work of cash management off your plate. If your business maintains a large reserve of cash, or if you are looking to reduce the work required to manage your cash, don’t hesitate to contact us. We look forward to the opportunity to provide your business with the MOST safety and the MOST competitive return available.
If you’re looking for even more valuable insights on banking, interest rates, and effectively managing your business cash, be sure to check out our Insights page and follow us on LinkedIn, Twitter and Facebook.