The Post-Pandemic Rebirth of Small Businesses Offers Banks Huge Opportunity
NEW YORK, May 19, 2021 — CI&T, a leader in driving digital transformation for global brands, today published (Re)open for Business, a new report examining how banks can better serve small businesses in a post-pandemic world.The research revealed that while the pandemic caused accelerated digital change in financial services, small businesses still want, and need, banking relationships.
“Small businesses are considered the lifeblood of the American economy, and banking relationships are the lifeblood of small businesses,” said Robin Borelli, Business Director, Financial Services at CI&T. “The post-pandemic rebirth of small businesses in the U.S. will create enormous opportunities for the banking industry. The primary research that formed the foundation of this study revealed significant insights into the possibilities – and risks – for small business-banking relationships of the future.”
This report analyzed survey responses, focus groups and interviews from 500+ U.S. based small and medium-sized businesses with an annual revenue up to $25M. Two key themes emerged from the research for small business-banking relationships in the future, including:
- 84% of small businesses reported having “very much” or some degree of trust in their bank, but focus groups and interviews revealed that while there is trust in banks, expectations are rising along with frustration and confusion over complex and opaque fee structures.
- Banks are uniquely positioned as the key partner for small businesses seeking efficient, day-to-day operations management such as payroll services, expense management, and tax advice. Banks may not want to provide these as direct offerings, but being a connector can create a deeper customer relationship. The winners will be those banks that can help the needs of these small businesses beyond that of the traditional deposit and credit model.
Digital as the primary way of doing business:
- Small business customers understand the convenience and cost-saving benefits of automation, but still want personal interaction and relationships due to the complexity of their work.
- Small businesses have options when it comes to technology and platforms designed to make their lives easier. This presents an excellent opportunity for trusted, reliable partners like banks to help with the technical and operational demands of making these systems work cohesively.
According to a 2020 report from the U.S. Small Business Administration, small businesses account for 44% of economic activity in the United States, employ 60.6 million people, which equates to over 47% of the private workforce. The impact of the pandemic was hard on small businesses, but as the country begins recovering, CI&T’s research shows the rebirth of small businesses presents an opportunity for banks to reform those partnerships.
View the full report here.
CI&T is a digital solutions partner for some of the world’s biggest companies, helping them drive growth and continuous innovation across business, people and technology. With operations across North America, Latin America, Europe, and the Asia-Pacific region, CI&T has a proven track record of delivering complex end-to-end solutions for the digital enterprise. For more information, visit www.ciandt.com.