Description
However, being a great small business bank is getting harder. Advances in technology have opened up the field to attackers, who target some of the most lucrative areas in small business financial services, such as payments and lending. Because these attackers are deploying the latest technology and solving more focused problems, they often provide a much better customer experience – seen, for example, in lending processes that take between a few minutes to a couple of days, rather than a matter of weeks, to complete.
And as small business owners and their employees get more comfortable with consumer technology such as iPhones, there is increasing variance among small businesses in how they want to connect with their banks (e.g., differing views on the importance and purpose of a local relationship manager, sensitivity to slower service or more paper-intensive applications).
Succeeding in this new environment will require a fundamental shift for banks — from a traditional set of banking tools to a digital skill-set. In recent years, retail banks – particularly small business banking operations – have increased efficiency by automating, simplifying, and applying lean principles to core processes. But this focus on systematizing operations often results in a narrow set of products and servicing options on the front end. The result is that banks have difficulty satisfying the needs of small businesses that fall outside their core target market. So, for example, a newer small business with a short credit history has a hard time getting a loan; another small business struggles to justify the costs of a point-of-sale device for payment processing. This lack of flexibility is not the way to gain small business customers.
