The past few years have seen businesses suffer from the impact of Brexit, the fallout of the pandemic and, most recently, the energy crisis and shocking surge in interest rates.
Businesses are stressed. And, in these trying times where organisations are scrutinising their accounts more closely than ever, banks have the power to provide better, more seamless services that can alleviate some of the pressure.
But for too long, business customers have been stuck in a rut with the quality of service they receive from their banks.
Traditional banks dominate the business banking market but need more innovation in the user experience they have provided for years.
While many of us now feel the benefit of having a challenger banking experience as part of our personal banking lives – we’re looking at you, Monzo, Starling and Revolut – these slick mobile-led experiences remain out of reach for business banking.
Business banking could and should be better, but how?
Why aren’t businesses jumping ship?
Despite the poor quality of experience traditional banks generally provide business customers, they are not the only option.
Some challengers like Monzo already offer business banking services, and there are banks like Quonto, a business bank for SMBs and startups that’s mobile-first and innovative. But we’ve barely scratched the surface regarding having something for a bigger, broader and more mature business audience.
The reality is that most mature businesses need more services than the average challenger bank can offer them – consider more niche and complex products like group credit limits, invoice financing and company cards.
Younger banks simply aren’t delivering these services yet. Moreover, for bigger established businesses, there’s value in stability – these long-standing banking institutions are usually seen as a safer bet and don’t cause concern among the c-suite.
However, challenger banks need to be applauded for pioneering greater digitisation and handy features for business customers, like being able to lock cards and get PIN reminders via your smartphone app or enabling easy MFA login with biometrics.
Consumers and business end-customers can and should benefit from these features and UX.
Sadly, however, business customers are missing out. While a challenger banking experience may be less of a headache, most businesses couldn’t jump ship (from their incumbent to a challenger) even if they wanted to without sacrificing essential products they need either now or in the future.
A window of opportunity for traditional banks
The trust that traditional banks have amassed among corporations shouldn’t be taken for granted.
In a more competitive climate, where business customers will start more closely scrutinising whether their banking provider delivers the best for them, a better user experience can make all the difference to customer retention.
Banks should be trying to ‘woo’ their customers more than ever.
There is a crucial window of opportunity for traditional banks to take their cues from the challengers and combine product breadth with service quality and new customer-focused features.
To achieve this, upgrading to a platform model and investing in a more ingenious core banking solution will be critical. This fundamental investment in a banks’ central technology stack will enable traditional banks to add and adapt their services with the agility needed to bring business banking up to the modern age of innovative banking experiences.
Yes, business customers have been left behind, but there is a way for the big banks to change this. Offering the best of both worlds to businesses can eliminate competition and retain market share.
About the Author: Ove Kreison is the CBO and Co-founder at Tuum.