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Digital Banking

Your SMB Banking Strategy How-To Guide

Melanie Reneris
Jan 9, 2024

Everything You Need to Know About Growing Small Business Banking

If expanding your services to the small- to midsize-business niche is on your horizon, you’re in good company: 65% of CEOs surveyed in Jack Henry’s 2023 Strategic Priorities Benchmark Study said they plan to expand SBM services in the coming years.

In the same study, improving the accountholder experience ranked lower, with only 34% of CEOs planning strategic initiatives. And yet, to be successful in expanding services to the SMB audience, banks and credit unions need to consider the experience – not just the technologies being offered.

The SMB Audience

While often grouped together as an audience, SMBs include a diverse collection of businesses with varying needs and levels of financial acumen.

As you consider expanding your SMB services, a good first step is to analyze your existing base of business accountholders and the market you intend to penetrate more deeply.

  • Micro-businesses, gig economy workers, and solopreneurs. These individuals have the potential to grow with you if you map out critical touchpoints and junctures in their business needs.

    These businesses are often focused on executing and monetizing an idea, while learning financial accounting best practices is a low (or even nonexistent) priority. Because of their ease of use and ready availability, these businesses are likely to use third-party financial services to perform basic functions like invoicing, payment acceptance, and bill payment.

    Once you’ve identified this segment, ensure you’re offering these essential services within an SMB-focused digital banking experience and make it easy for them to open new deposit accounts online.

  • Small businesses. As a business grows and needs to add employees for the first time or prepares to expand its product offerings or distribution, there’s a good chance they’re going to look for sources of funding and enhanced digital offerings that you’re in prime position to offer.

    These businesses are often challenged by the process of scaling up. A strong connection with their financial institution can help these businesses navigate the complexities that come with growth – whether that’s seeking lines of credit or loans to move into a new market, managing payroll for the first time, or separating deposits into operating, payroll, or savings accounts to manage funds more effectively.

    If you’re hoping to serve this segment well, ensure you have the tools they need to succeed that build upon their earlier needs: ACH, wires, payroll, expanded cash flow reporting, and a user interface that enables dual control or permissioning for various employees on the digital side. Low-friction access to working capital, seasonal lines of credit, merchant services, and the business expertise of your commercial bankers often round out their needs.
  • Midsize businesses. As your small businesses continue to scale and grow to upwards of 100 employees or more than $50M in annual revenue, their financial needs become more complex.

    To manage their financial position more effectively, they’re likely looking for integrations to accounting software, have more complex funding needs, and have designated individuals or professional service providers like accountants or tax professionals on staff or retained to provide services.

    Improving the experience for a midsize business includes considering things like removing functional silos between your internal departments, so your lenders can access insights from the businesses’ transactional activities when making their lending decisions. This segment needs scalable digital banking that provides even stronger fraud protection in the form of Positive Pay for checks, flexible entitlements for their digital users, and more advanced cash management tools that could include sweep accounts.

Mapping the Experience

After you’ve finished analyzing your current and target business niche markets, it’s time to step into their shoes.

Celent asserts that delivering efficient journeys means using an accountholder-centric lens and focusing on workflows (aka “jobs to be done”) across the financial supply chain, including and beyond traditional banking.

In their Technology Trends Previsory Corporate Banking 2024 Edition, Celent states that once you understand the financial jobs your business accountholders need to accomplish, you can start designing an experience that facilitates the completion of those jobs.

Consider key touchpoints and needs in the lifecycle of their business and take time to map the ideal experience. You may already have the necessary tools and products, or you may discover gaps in common interactions like:

  • Opening a business account online
  • Applying for a business loan via digital channels
  • Accessing business tools through your digital platform
  • Payment acceptance and invoicing

This may mean integrating third-party business service providers into your digital banking experience (like Autobooks is integrated into the Banno Digital Platform™), utilizing financial data to deliver alerts and actionable insights to facilitate financial management, linking your loan origination platform to your digital experience, or moving from a multiple loan origination systems for personal and commercial needs to a unified LOS.

While it takes time to map journeys and address gaps, the delivery of your SMB strategy will be stronger and more effective for the delay.

Remembering the Onboarding

Celent continues on to note that a more digital onboarding experience not only decreases time to revenue but can also drive adoption of digital channels from day one.

Banks and credit unions that are intentional about this process can develop stronger, deeper relationships that stand the test of time.

If your digital platform for SMBs utilizes an interface that’s similar to that of your retail platform, your SMB accountholders will enjoy a smooth transition. Especially when you take time to use in-app messaging or a targeted email campaign to introduce them to the new features and functionality that they need as a business owner.

Ensure your business accountholders understand how to use digital communication tools like Conversations for Business to get in touch with your organization and to decrease the risk of business email compromise by taking approvals for higher-risk transactions out of the email channel and into the authenticated app.

Take the time to explain how to add users, where to find newer tools like invoicing or payment acceptance, and how to generate actionable reports and insights about their financial position. If you’ve created links to your digital loan application system, point out where it can be found so you’re top of mind when the timing is right.

In short, remember that onboarding is not just a consumer function. It applies to your business accountholders as well.

Set Yourself Up for Success

The right set of business banking tools is key to developing a successful business accountholder experience and SMB strategy. Make sure you’re setting yourself up for success with the banking technology you need:

Your business accountholders – and your bottom line – will thank you for it.


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