Despite the emergence of digital disruptors in the banking sector, the additional competition presents banks with an opportunity to take the initiative and leverage their long-established relationships with SMEs, though they will need to act quickly.
In the current economic climate, the existing relationships between banks and SMEs are not quite what they once were. According to recent data from the Bank of England, the value of outstanding SME lending fell by almost one-fifth after the financial crisis. Whether or not SMEs are less reliant on credit, the traditionally strong credit relationship – the bedrock – between bank and business customer has dwindled.
To separate fact from fiction, Strands, a leading provider of business financial management technology, commissioned research to understand what SMEs need from a banking relationship and how close banks are to meeting those needs.
Over 200 SMEs and banks serving in excess of 1.3m SMEs were surveyed. The research, the first to directly compare bank’s and SMEs perspective on business banking, uncovers new insights into SMEs’ key banking challenges, whether banks are effectively addressing these needs, and how they can bridge the gap to capitalize on the market opportunity.