The consumer experience matters in business banking, too

The advantages of committing to a single platform to integrate delivery of multiple banking services for businesses.

By Vince Bezemer

From overhauling their online presence to introducing mobile functionalities, many banks have invested significant time, energy and capital into improving the consumer banking experience. And while many institutions still have quite a way to go in terms of creating a truly customer-centric, engaging retail banking experience, they have even further to go when it comes to business banking.

According to a recent study from digital payments provider Marqeta, 68 percent of business owners shared that the digital features of business bank accounts were not as advanced as their personal, consumer bank accounts. In addition, Cornerstone Advisors found that four out of five business owners do not believe their banks provide the services needed to run their business finances.

Fintech firms have started stepping up to free business owners from onerous, outdated and analog banking processes. In fact, the only two profitable challenger banks in the U.K.—OakNorth and Starling—have made a point of engaging business customers, suggesting that financial institutions are leaving money on the table by not stepping up their business banking capabilities. As banks look to remain competitive with challengers from fintech firms, banks must keep in mind the key pain points business owners encounter when trying to organize their financial needs. As well as how they can solve them through smart investments in technology.

Onerous onboarding processes

Business owners have slightly more complicated needs when it comes to opening a bank account. Like a retail banking customer, they’ll need to provide personal information about themselves But on top of that, they will also need to provide information about their business, appropriate legal documentation and information about any other business owners or employees who will need access to the account. Moreover, business owners need to consider their unique account needs. (For example, they may need a merchant account if they are a consumer-facing business and will be processing transactions.)

With so many moving parts and paperwork involved in the onboarding process, many banks are unable to do this seamlessly and entirely online – driving potentially lucrative customers to competitors that offer a more frictionless process. This shift is already taking place in the SME market, with more than half of SMEs surveyed for MANTL’s 2021 Banking Impact Report sharing that they would not engage with a business that did not offer online account opening services.

That being said, it is entirely possible to digitize the account opening process from end-to-end. The key is in identifying technology that enables financial institutions to marry the human and the digital. With the right platform, financial institutions can allow a business to quickly upload all of its documentation in one place and provide key details about others who need access to the account. On the other side of the platform, bank employees are able to instantly collate the materials, identify any missing documents, provision new users and instantaneously open an account for the business owner.

The key to implementing such a platform is ensuring that it is built in a way so that business owners never have to pick up the phone or walk into the branch if they don’t want to. Digital account opening should not just be a door the customer walks through. It should be a destination in and of itself.

Persistent silos

The work of eliminating friction doesn’t stop once the onboarding process is complete. One of the key frustrations a business owner can face as an existing banking customer is accomplishing tasks and transactions without having to jump between channels, departments and bank employees. When business owners are unable to apply for small business loans without visiting the branch, or if they can only complete certain transactions via computer (versus being able to do so on-the-go with a smartphone), the financial institution is at risk of losing an upselling opportunity to a more efficient and user-friendly competitor.

These types of inefficiencies are ultimately the result of siloed business functions—something that often happens when a financial institution architects its business around products instead of the customer. Banks benefit when considering alternatives to this mindset and instead shift toward creating customer-centric experiences that prioritize convenience and ease.

How can they do this?

By implementing technology that enables employees to have end-to-end visibility of each customer regardless of department; and allows customers to complete any transaction on any platform—online or offline—that they choose. This approach facilitates speed and convenience. For example, a business owner looking to take out a loan can do so quickly on a mobile app, and the loan officer at the bank is able to see the customer’s full financial picture to make a better decision about loan amounts and repayment terms. No visits to the branch are necessary; no paper is wasted; the customers are able to secure their loans faster; and the institution deepens the customer relationship. It’s a win-win.

Lack of personalization

Business owners, like any customer, have become accustomed to an unprecedented level of personalization in every aspect of their lives. Their expectations, then, are high for their financial institution. Not only do they need their bank to cater to their business’ unique needs. They also wish for their bank to scale alongside their business without losing that personalization. Otherwise, they may move to competing apps and platforms.

The deep personalization and understanding of the customer’s individual requirements is what has largely driven financial institutions to rely on in-person service. It has also driven weak technology adoption for fear of losing that personalization. But the irony is that modern technology can both enable and amplify the human touch in business banking. Technology has the power to aggregate customer data and interactions in a digestible way that allows institutions to make better, more relevant decisions for each customer at an individual level—and to continuously provide that level of customization throughout all stages of the customer’s business’ maturity. What’s more is that there is general consumer demand for technology solutions that do integrate the human touch. According to Accenture’s “2022 Top 10 Banking Trends Report,” seven out of 10 surveyed consumers would welcome a digital banking experience that includes human advice. Short of technology replacing the human touch, it actually provides the financial institution’s employees with better (and faster) information to improve the customer experience overall.

Bringing it all together

Taken all together, the above pain points—and their accompanying solutions—suggest that financial institutions must adopt a variety of technologies and products to meaningfully compete for business banking customers. And it may be tempting for organizations to adopt one-off solutions to avoid needing to reinvent their entire technology stack.

But this piecemeal approach to modernizing the business banking experience only reinforces the siloes and inefficiencies that have put so many financial institutions behind the curve. Instead a single platform approach to redesign experience around their customer has advantages. By bringing together all of their technology functions—digital onboarding, digital banking, customer service and more—under a unified umbrella, financial institutions will be able to break down the barriers that have historically created poor customer experiences, in turn becoming an engagement banking provider to even the most discerning of business owners.

In other words: Every bank should strive to become the “Shopify of business banking,” a digital one-stop-shop for business owners’ financial services needs. And with a single platform approach, they can.

Share.