As the financial services landscape continues to evolve, one segment stands out as both underserved and full of potential: small businesses.
For community banks and credit unions, the opportunity to win – and retain – these accountholders has never been greater. But doing so requires more than just rebranding your consumer banking tools. It demands that you deliver purpose-built small business digital banking solutions that meet the unique needs of modern small business owners.
Datos Insights surveyed 1,004 U.S.-based small businesses for their 2025 Datos Matrix: Leading U.S. Providers of Digital Small-Business Banking report, and the results are telling: 37% of respondents say they will “definitely or probably” switch financial institutions within the next two years. That number jumps to 44% among millennial- and Gen Z-led businesses.
The message is clear: small businesses are actively seeking better digital banking experiences.
The Digital Gap – and the Risk of Falling Behind
Despite the growing demand for smarter, more intuitive digital banking solutions, many financial institutions are falling short. The Datos Matrix report reveals that:
- 85% of small businesses want tighter integration between their banking and accounting systems.
- 77% say their primary financial institution offers few products or services they’d be willing to pay for.
- 75% go outside their financial institution to meet at least one financial need.
These gaps represent both a challenge and an opportunity.
Fintechs and large national banks are already capitalizing on this demand with agile, tech-forward solutions. For community banks and credit unions, the path forward lies in embracing modern, open digital platforms that can compete on both functionality and user experience.
What Small Businesses Really Want
The report highlights several key trends shaping the future of small business banking:
- AI-powered tools: 91% of small- to medium-sized businesses (SMBs) using AI tools report increased revenue. Features like predictive analytics, cash flow forecasting, and personalized dashboards are no longer “nice to have” – they’re expected.
- Cloud-native platforms: 99% of new SMB banking contracts in 2025 are hosted in the cloud, offering faster deployment, lower costs, and continuous innovation.
- Fintech integration: Open APIs and partnerships with third-party providers are essential for delivering the seamless, connected experiences small businesses demand.
Jack Henry: A Proven Leader in SMB Digital Banking
Even in today’s competitive landscape, Jack Henry™ has been recognized by Datos Insights as a leading provider of small business digital banking solutions. And its Banno Business™ platform – purpose-built for community banks and credit unions – stands out as a top performer.
So, what sets Banno Business apart?
- A cloud-native, API-first architecture that enables easy integration with fintech providers – without paywalls or technical barriers.
- Granular multi-user entitlements and robust money management tools tailored to the needs of small businesses.
- Integrated AI capabilities that enhance customer communications and deliver actionable insights.
- A unified platform that supports both retail and business banking, streamlining operations and improving customer experience.
With over 220 financial institutions already using Banno Business, Jack Henry is helping financial institutions modernize their digital offerings while maintaining control over their strategy and customer relationships.
The Road Ahead
Small businesses continue to grow more tech-savvy and digitally demanding, so you must evolve to stay relevant.
The 2025 Datos Matrix report shows that the future of small business banking belongs to those who invest in innovation, integration, and customer-centric design. The good news is that with the right platform and strategy, you can not only compete, but lead.
Ready to learn more? Download the full 2025 Datos Matrix report to see how your financial institution can lead the way in small business digital banking.
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