PLANO, Texas– A new report has been released that offers some insights into the stability of the relationships between financial institutions (FIs) and small businesses (SMBs) in the wake of the COVID-19 pandemic.
Released by Alkami Technology, the report, “Digital Banking Market Pulse: Small business recovery in light of the FI paradigm shift,” is based on a survey of 400 small businesses to understand how COVID has impacted them and how they feel about the future.
“The pandemic accelerated the adoption of financial technology for many small businesses, prompting an evolution in their business model,” said Allison Cerra, chief marketing officer of Alkami. “With the help of digital transformation, small businesses are bouncing back in greater numbers. FIs have an opportunity to grow the relationship with these firms by meeting them online, on mobile and on their terms.”
According to Alkami, key findings in the report include:
- Primacy is key. The primary financial institution (PFI) relationship holds sway. The key for FIs is to gain primacy through the deposit account, which is how more than half of SMBs define their PFI relationship. Digital account opening is the onramp to a broader financial relationship with these firms.
- SMBs are investing in their business. Fifty-three percent of SMBs cited technology as an investment priority—opening the door for financial providers to grow the relationship.
- FIs have most of the mindshare. More than 60% of SMBs believe the “bank” of the future will be a financial services company (vs. a technology company).