A new report from Aite Group analyses US small business adoption of online banking capabilities and helps financial institutions prioritise the solution enhancements that promise the greatest likelihood for meeting the needs of this customer segment.
Additionally, it explores the need for financial institutions to focus on: enhancing their cash management offerings; offering new capabilities to improve the efficiency of accounts receivables and accounts payables; more effectively bundling online products for small-business sub-segments; and increasing convenience.
More than 85% of US financial institutions have increased their focus on meeting the needs of the small business customer segment over the last few years. Despite their efforts, customer satisfaction levels are not as high as they should be in a competitive marketplace, and online banking sites are primarily used to check balances and transfer funds rather than for more sophisticated transactions. Financial institutions are missing opportunities to deepen their relationships with this important customer segment and generate additional fee-based revenues by failing to offer the right online capabilities. Based on the results of a July 2009 online survey of 283 US small businesses generating less than US$10m in annual revenues, the report reveals that most businesses consider the sophistication of an institution’s online offerings a key reason for selecting a particular institution as their primary bank.
“Small business customers are, to a large degree, underserved, so bank efforts to better understand their needs can lead to increases in market share and new streams of revenue,” says Christine Barry, research director with Aite Group and co-author of this report. “Given the high level of importance small businesses place on online capabilities, it is essential that financial institutions continue to enhance the sophistication of their offerings with graphical capabilities, cash position reports and capabilities like online payroll and electronic invoice presentment and payment in order to ensure the highest levels of customer satisfaction.”
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