To meet the demands of tech-savvy generations, banks may need to rethink long-held assumptions about business customer needs. Today’s clients are younger, more digitally fluent, and less patient with inefficiencies in their financial processes.
Consumer banking has rapidly transformed in recent years. Retail banks experienced strong growth and profitability fueled by pandemic-era stimulus, heightened consumer spending and rising interest rates that expanded net interest margins, according to McKinsey.
This trend has spurred widespread investment in technology across the banking sector, as institutions strive to attract and more effectively serve a broader and more digitally savvy consumer base.
But while banks are investing heavily in upgrading consumer banking experiences, many business banking operations still rely on outdated systems and legacy processes. This gap is especially prominent for smaller institutions — such as community banks and credit unions — which often lack the internal resources and scale of their larger counterparts to deliver more modern customer experiences.
As younger generations advance in their careers and launch their own businesses, they are likely to prioritize easy, efficient ways to access and manage their company’s finances. For example, survey data indicates that Gen Z is more entrepreneurial than previous generations and more likely to juggle multiple income streams. They tend to be more skeptical of traditional employment paths, often combining a primary job with one or more side hustles.
These younger generations not only prefer, but often expect fluid digital experiences. If banks fail to adapt their offerings to meet these expectations, they risk losing significant business from digital native SMB owners in the long term.
Meeting the expectations of more tech savvy generations may require banks to reexamine deeply held beliefs about what business customers want. Many of these clients are now younger, more tech-savvy, and less tolerant of friction in their financial workflows. By prioritizing user-centric design, automation, and data-driven personalization, banks can not only improve satisfaction but also unlock new revenue opportunities and deepen client relationships.
To stay competitive, community banks must bridge the widening gap between the business and consumer banking experience. This may mean borrowing design principles, UX strategies, and service models from the consumer side and applying them to business products. As consumers navigate growing economic uncertainty, the role of business banking is poised to become more critical than ever, says Nikhil Lele, Americas Consulting Banking and Capital Markets leader at EY.
“Small businesses are going to be the engine that keeps the economy humming and moving forward and creating opportunities and creating value for customers,” he says. “The question really becomes when are all of the banks going to put as much intense focus on innovating for the business segment, than the consumer segment.”
What’s Driving this Gap?
So, what exactly causes this difference in experience? Experts suggest there are several key factors at play.
One reason is that banks often have a clearer, more direct view into the consumer experience, Lele says. This approach can make it harder to gather feedback and refine solutions to align with the evolving expectations of end customers.
“One of the primary reasons is that for banks who serve consumers there’s a direct line between the experiences that they develop and the people who use those experiences,” he says. “In the business banking world, banks are creating solutions for small business owners who then serve the end customer. There’s a multihop to create more value for small business owners.”
For many banks, the business client experience has traditionally centered around building and maintaining personal relationships, says AK Patel, founder and CEO of Attune, a fintech providing a digital origination platform for banks and credit unions. In a digital world where customers increasingly expect one-click experiences, requiring business owners to visit a branch to open an account is no longer practical.
“The business side, still to this day, is very relationship driven,” Patel says. “But it’s costing the bank a lot of money and resources to keep a smaller relationship. I understand when there is a business that has got tens of millions of dollars, that white glove service. But if it’s a small and medium size business, you should shift that back to self service.”
Simplifying the User Experience and Onboarding Process
Banks can take important cues from consumer banking to enhance the business banking experience. One key area of improvement is simplifying the account opening process by minimizing paperwork and streamlining workflows, Patel says.
By automating routine and repetitive tasks — such as application processing, document collection, or transaction categorisation — banks can significantly reduce wait times, eliminate manual errors, and free up both customers and staff to focus on higher-value activities. Automation not only accelerates service delivery but also creates a more responsive, efficient, and satisfying experience overall. There are straightforward steps banks can take to improve the experience — for example, automating the signature process during account opening, Patel says.
“A lot of small businesses have more than 2-4 owners, they all have to be authorised signers on the accounts,” Patel says. “The biggest issue in the business banking side, how can we get all of the owners to sign all of the documents in the time frame we need them to, we help automating that from a document signing, document collecting perspective.”
Other critical processes — such as funds transfers, compliance verification, and account funding — can also be automated to enhance the overall user experience. By implementing automation-driven improvements in account opening and management, banks can significantly reduce the time and effort required to open a business bank account.
“Those mundane tasks, technology can do, wouldn’t you spend your time building deeper relationships with your existing business banking customers, or spend that time to go get new business banking customers?” he says.
The Rise of the Marketplace Experience
An increasing number of banks and fintechs are recognizing the demand for a more integrated digital banking experience, sparking the rise of “marketplace”-style offerings that consolidate various financial tools and services into a single platform, Lele says. These tools enable customers to access a wide range of products and services through a single platform, integrating them in an easy-to-use, centralised dashboard. This approach has gained traction in consumer banking, and is now making its way into the business banking space.
“There’s an entire array of marketplace infrastructure providers who are largely invisible to the end consumer, but provide all of the connectivity between a consumer, where they shop, and fulfills the deposit taking and credit experience,” Lele says. “The technology allows for seamless customer onboarding throughout that journey. The marketplace has become this very mature way of acquiring customers.”
Several banks are already collaborating with fintechs to provide integrated digital experiences, and this trend is expected to accelerate, according to Lele. This initiative is largely driven by community banks and credit unions, which are committed to delivering more robust digital experiences for their customers.
“Small businesses have been knitting together their own fintech solutions for a number of years,” he says. “Now banks are starting to partner up and create a better ecosystem by effectively taking banking solutions and creating a marketplace, where they can create a hub for the small business.”
Source: The Financial Brand
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