170. Soliciting Business

Very closely akin to advertising is the question of soliciting business. On the whole it is better understood than the question of advertising. National banks in the City of New York have long employed solicitors to travel through the country.

Their nearness to the bond market, close connections at Washington, advantages as reserve agent, large capital and surplus, offers of loans to tide over stringent seasons, have been texts for many talks on "doing business with our bank." New banks are solicited for deposit accounts by the New York reserve banks before organization papers are complete. It has long been the custom for New York banks to send officers to state bankers' conventions and on tours through certain sections to become acquainted with the present customers and to make new friends.

Of late years the professional bank soliciter for local business has appeared in the large cities. His promises, ideas and terms are of varied hues. The fad that has been most prevalent is the locked savings bank scheme. The depositor is given a pretty little bank which can be opened only by the teller. The depositor is supposed to keep this toy continuously before him to remind him that he must save. At frequent intervals he is supposed to "tote" it to the bank, have it opened and the contents credited to his account. One of this kind of toy banks contained a clock which could not be wound unless a coin was inserted in the slot. And this is called soliciting business.

Other companies have employed a large force to solicit accounts, giving the solicitors a percentage on the average daily balances maintained by the depositors obtained by the solicitor, while he remains in the employ of the company. There is a grave danger in pushing for business. Promises of loans are often made which ought not and can not be kept. Too high interest rates are promised and the bank is tempted into questionable loans because the interest rates are high. It is far better to have a slow but sure growth, than a rapid rise which may perish with the first strain.