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Understand your small business customers through data acquisition

Understand your small business customers through data acquisition

08/15/2023
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In our second deep-dive into Celent's 'How to Become a Challenger in Small Business Banking' report, we take a close look at how the right data can supercharge the relationship between banks and SMBs.

Is data that crucial to banks? 

According to Celent’s latest report, the answer is yes. With 85% of SMBs in North America willing provide data to banks in return for solutions tailored to them, the time and incentive to become a challenger in the small business banking arena is here.  

 In this blog, we’ll run through why banks need to understand their SMB customers better and how insights driven by data can help them achieve this understanding. In addition, we’ll outline how banks can leverage such data to grow their loan book, increase deposits as well as rates of customer loyalty. 

Let’s dive in.   

Data + Knowledge + Wisdom = CHALLENGER 

This formula from Celent’s report spells out the perfect recipe for you to become the ‘go-to’ financial services provider for micro, small and medium-sized businesses. Yet, there is no real incentive to provide solutions to an audience that you know nothing about. For instance, were you aware that SMBs tend to hide within their personal checking accounts, instead of taking out a BCA?  

 ‘What is the psychology behind why SMBs hide in plain sight?’  Our chair and fintech veteran, Tom Shen answered “most financial institutions charge a small monthly fee for a business account. A small business owner will more than likely not wish to pay this fee and so will seek out a personal account that they will use as a business account. They are therefore hidden there.”  

If data is the catalyst, then ‘understanding’ is the by-product. Once you gain insight into who and where your SMB customers are, how they get paid and how quickly, for instance, only then are you able to provide them with tailored solutions driven by their own data, that meets their exacting needs and wants. You’ve just gained yourself a loyal and trusting customer.  

Accessing the right data 

Data-driven insights into the SMBs’ banking behaviours and financial wellbeing can provide banks with the opportunity to grow their loan book, increase deposits, provide more meaningful offerings and thereby build a trusted relationship.

BankiFi, as shown in Celent’s latest report, scores highly in the provision of solutions that help SMBs ‘pay and get paid’, as well as our ability to glean information helpful to the bank from our vast data lake. Here’s an example of what we’ve learned from SMBs who utilise our solution to help them pay and get paid: 

  • 77% of SMBs send their payment requests via SMS, busting the myth that this method is unsafe for the customer to use
  • 93.7% of our user's place are more engaged with bank-branded services, showcasing that there remains an unwavering trust in their financial institution
  • 49.1% of users who utilise our app solution are customers of varying banks. Thanks to the power of Open Banking, this gives the bank an ability to acquire new customers at minimal cost

This data helps the bank to collate knowledge of the SMBs’ patterns, thus leading to a deeper connection and understanding of how these businesses work with/need from their trusted financial institution. It's time to harness that data and reap the rewards of investing in those who have been underserved for far too long. 

Download Celent's Report 

Brimming with insightful information on why BankiFi is the perfect fintech to partner with if your goals include:  

  • Growing deposits 
  • Increasing your loan book 
  • Retaining and acquiring SMB customers
  • Becoming the go-to and trusted service for SMBs to manage their finances

About Elle Rushby | Marketing Executive

Elle Rushby is the Marketing Executive for banking and technology company, BankiFi. With a passion for content creation, copywriting and carving marketing strategies (to name but a few), she is very much enjoying implementing her creativity into the world of BankiFi.

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