There’s little risk of retail banking customers running short of options when it comes to financial services.
From automatic bill payments to chatbots, banks haven’t been shy about implementing new features designed to enhance the customer experience. For example, in 2015 Bank of America introduced fingerprint and touch ID sign-in for its mobile banking app and its table stakes. Others are aiming to take security and convenience to the next level using Face ID.
But even that doesn’t mark the full extent of banks’ efforts to accommodate customers. Financial institutions are devoting plenty of time and money toward improving their service – and the results speak for themselves. Nine out of 10 Americans rate their bank’s service as “good,” “very good” or “excellent.”
Most businesses, however, can’t say the same.
Has this focus on the needs of everyday individuals caused banks to largely overlook the concerns of their business customers? Such a mistake could continue to prove costly moving forward. From 2014 to 2016, the rate of U.S. entrepreneurship increased by 15 percent, and they tend to be very profitable customers once they reach scale.
Here’s a look at how value-added services can help banks address businesses’ most pressing problems, increasing loyalty and revenue.
Open up options with fintech partnerships
Often competing for the same business customers, banks and fintech startups have been at odds for quite some time. But as it turns out, they may be better together. By working with fintech startups to populate and launch a solutions marketplace, banks can meet the needs and expectation of businesses, regardless of their size, industry or other unique needs.
Whether it’s a loan origination wizard or a specialized accounts payable (A/P) system, fintech providers can build solutions and niche experiences more efficiently than most banks, while banks retain significant cost advantages in most categories. Logically, this newfound collaboration between banks and fintechs represents a stark departure from a past in which the two rivaled one another. Instead of fighting for the same customers, a growing number of banks are leveraging their established relationships to connect fintech providers with their own client base. The key to making these partnerships work is secure, permissioned data exchange, powered by modern API technologies and a service orchestration platform.
The result? A win-win for both fintech startups and the businesses that banks cater to. Not only do fintechs have the opportunity to effectively deliver their solutions, but bank customers get access to tools that may have been previously required heavy paperwork and unruly technology integrations to access. Best of all, there’s no huge investment required. Banks can simply choose which solutions meet the needs of their clients without worrying about any long-lasting IT projects. Once an initial integration is completed, solutions can be switched on and off at the touch of a button.
Data, the currency of the “fintech bazaar”
Though much has been made of addressing consumer concerns, a similar sense of urgency has long been lacking when it comes to businesses. Improving product offerings and product interoperability can rectify this and help banks retain their prized position as the go-to providers for transactional services.
By creating a marketplace in which businesses select the value-added solutions they’ve come to expect, banks can deliver the same standard of customer service individual customers have enjoyed for years. By populating their B2B bazaars with a plethora of secured and interoperating fintech services (yes, even fintech services that may overlap with the bank’s own payment products), banks can leverage their trust and earn unprecedented access to valuable corporate-held data. And as the data flows, loyalty – as well as revenue – promises to do the same.
About the author
Lisa Shields is the founder of and Chief Executive Officer at FI.SPAN, where she leads the company with a dual emphasis on people and product. Lisa is an engineer by trade and an entrepreneur at heart, having founded and led Hyperwallet for 15 years before launching FI.SPAN.