SMEs see banks as utility providers not business partners

Wednesday 1 November 2017 09:57 CET | News

Strands, a provider of business financial management technology, has released the findings from its SME Banking: Intelligence – Not Applied, a study of over 200 SMEs and banks. 

The study takes an in-depth look at the relationships between banks and SMEs. An important conclusion is that small businesses view banks as utility providers (69%) and 83% of the banks surveyed admit that this is the case. 

However, there is plenty for growing this relationship beyond the current state. As such, 84% of SMEs want financial planning and business growth advice delivered digitally. However, only 17% of banks provide the necessary financial management tools. 

Digital engagement, the study confirms, remains the most effective way to attract and retain small businesses, but 83% of banks said that a digital transformation would take them 4 to 5 years

It appears that banks are not agile enough to meet small businesses’ demands. This puts them in danger of increased competition from challenger banks. The study shows that 43% of SMEs are considering switching to a challenger bank. Banks are keenly aware of the threat posed with 83% saying that SMEs are likely to open an account with a challenger bank. 

The report SME Banking: Intelligence – Not Applied is based on two surveys. Sapio Research, on behalf of Strands, surveyed respondents from over 200 UK SME companies, employing up to 250 people. Executives from banks, serving over 1.3m UK SMEs, were also interviewed using the same questions.

A full copy of the report can be viewed and downloaded here: 

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Keywords: SME, banks, online banking, challenger banks, financial management technology, financial management, Strands
Categories: Banking & Fintech | Online & Mobile Banking
Countries: World
This article is part of category

Banking & Fintech