One of the biggest fears for every income earner is losing money.
From the Corporate 9-5 to the small business entrepreneur, banking answers the question of where to keep money safely. There are numerous banking options available. Some are made for big corporations. Some are built for daily use.
But how do you know which one works best for you?
Let’s break down the difference between microfinance banks and commercial banks, and how to choose what helps your money grow.
What is a Microfinance Bank?
Microfinance banks are built for everyday people and small businesses, the traders, riders, artisans, and side-hustlers. For many of these individuals, traditional banks can feel out of reach due to requirements that are either too stressful or difficult to access, or products that they don’t understand.
Microfinance bridges that gap. It’s banking that understands the hustle, the uncertainty, and the ambition that drive people forward. It’s about providing tools, credit, and support that help dreams grow into sustainable livelihoods.
They make it easier to:
- Get loans without too much paperwork
- Save little by little
- Access support when traditional banks say “no”
- Fast zero to no interest on transactions
They’re great if you’re just starting out or running a small gig.
What is a Commercial Bank?
Commercial banks are full-service financial institutions designed to serve individuals, businesses, and large organizations. They offer a broader range of services, from savings and current accounts to business financing, international transactions, and investment solutions.
More advanced in scope, commercial banks are equipped to handle larger transactions, higher volumes, and more complex financial needs, making them a central hub for both personal and corporate banking
With a commercial bank, you can:
- Save, borrow, and spend all in one place
- Open multiple accounts, including current, savings, domiciliary, and other account types.
- Access bigger loans
- Use digital tools like apps, transfers, and debit cards
But they usually require more documents, and sometimes, they don’t feel as personal.
So How do you decide?
It depends on your goals. Your lifestyle and needs determine what type of banking will suit you better.
If you run a small business (such as online vendors, Uber drivers, salesmen or women, etc.), then a microfinance bank will be better suited for you. Microfinance banks offer quick, small-scale loans suitable for businesspeople. If you need fast, flexible, and easy access to your finances, then microfinance banks are your go-to.
Commercial banks offer a more structured banking system, suited to those in the corporate and large business sectors. These banks require full documentation, which are necessary for access to products and services within the banking ecosystem. They offer a full mainstream banking experience, including debit and credit cards, internet banking, USSD transactions, etc,
If you need to build your credit score or have a large business and need access to bigger loans, or just need more structure for your corporate lifestyle, the Commercial banks should be your go-to.
What if You Could Have Both?
That’s where Stellas Bank comes in.
We are building a banking experience that gives you the flexibility of microfinance and the power of commercial banking. At the end of the day, banking should work for you.
Whether you’re stacking your first N500 or planning your next big move, Stellas has your back.
