Small businesses make up more than 99% of the economy and are responsible for 65% of new job creation. In our opinion, there’s nothing “small” about that.

Many financial institutions (FIs) disregard small business owners despite these statistics. Only 25% of small-to-medium sized businesses (SMBs) have awarded relationship managers a “very good” rating since COVID-19, according to a recent survey by The Financial Brand. Even worse, according to research by Accenture, 42% of SMBs think alternative providers can give better service than established banks.

Part of the problem is that “small business” is a broad term, which means that a one-size-fits-all approach can’t serve every small business owner. Small business banking needs can vary based on a number of factors, which requires that FIs have flexible and scalable technology to meet those needs. These factors include:

1. Digital appetite and aptitude of the owner

The diversity of small business owners in the United States is reflected in the breadth of their digital appetites. One small company owner might wish to start their loan application online to discover what they are eligible for without speaking to anyone. A mom-and-pop startup’s co-founders might decide to arrange a branch visit so they can discuss their alternatives. The owner of a long-running company who has a good working connection with their banker could wish to call them at the same time to check in regarding a new product line they’re interested in launching.

2. Maturity/size of the business

A company’s requirements become more complex as it expands. In order to handle their payables and receivables, a successful small business owner may need to acquire treasury services. They may also be interested in investigating new financing possibilities as they grow their market. On the other hand, a smaller business owner could be willing to investigate options like an SBA Express loan.

3. Nature of the transaction

Many participants in the banking industry, such as alternative lenders, catering to the transactional needs of small business owners. However, in a perfect world, technology suppliers would simultaneously take into account the requirements of the FI, the lender, and the small company owner. FIs are best positioned to offer tailored advice and dependable service to their SMB clients when all essential parties are given the opportunity to cooperate in a balanced manner.

Small business owners have at least one trait despite their numerous diversity. They are the only ones who truly understand their business, and as they move forward in their entrepreneurial path, they desire encouragement, consolation, and individualized advice. They want a banker who understands their situation before they even tell them to reach out to their FI.