Connected Customer Experience: Transaction Banking and SMBs

Sept 23, 2019

With the growth of SMBs (small and medium businesses) and the proof that they are becoming the backbone of societies, transaction banks are in a unique position to build ecosystems where SMBs can thrive.

SMBs contribute to 33%1 of the GDP today; one could imagine transaction banks would jump at the opportunity to serve them better. However, serving SMBs can be costly for banks, and they haven’t entirely delivered innovative banking products and services to the corporate treasurers and smaller businesses the way they have done to their retail clientele, leaving SMBs in the dark when it comes to connected customer experience.

Banks are falling short when it comes to a connected customer experience for SMBs

Integration is a primary challenge in the customer experience transformation. Low levels of automation on the back-end of most banks means an increased volume of administrative tasks, lower performance of staff, customer-unfriendly interface, improper flow of data, and redundancies. None of these spell “customer-friendly.” Along with that, trapped cash is another concern for SMBs in emerging markets who have decentralized operations and a large number of bank accounts in each market.

In an increasingly digital world, SMBs are not pleased with the way they interact with their banks. And with the growing threat posed by non-banking startups disrupting the banking and financial services space, banks need to decide if they want to be a part of the future. These startups are providing traditional banking services with a customer-centric approach, and corporates are responding to them.

And no wonder. SMBs are searching for a more customer-friendly approach to their banking; they have other priorities besides digging through clunky back-ends to try to figure out how to get the information they need. Banks need to catch up if they don’t want to miss out on the $4002 billion opportunity in the transaction banking revenue pool of emerging markets.

Switching from traditional to transformational banking

2020 is just around the corner, and large corporates and SMBs alike need deeper intelligent business insights, tools that can help them stay relevant in their markets and a simple albeit intuitive user interface that helps them resolve their day-to-day financial issues at the click of a button.

Transaction banks are in a favorable position to serve SMBs and give them a more customer-friendly approach to traditional banking. They have a deeper understanding of the local markets and regulations, so that they can help SMBs scale faster, along with many other benefits.

Banks need to figure out their value proposition and develop digital transformation strategies for every customer segment and enable SMBs to conduct cross-border commercial transactions with ease and help them expand to international markets.

SMBs need a customer-friendly approach to transactional banking

Even with their significant revenue potential, SMBs are underserved. A connected customer-centric strategy is critical for transaction banks to unlock the potential of SMBs. With digitization creating its momentum, banks will need to adapt to new digital ecosystems where SMBs can not only survive, but thrive. They need to start going beyond offering traditional banking solutions and meet customers where they are so they can better focus on finding new frontiers to boost trade and economy.

Banks who offer an integrated transaction banking platform focused on the personalization of products and services can suit to the uniqueness of each customer segment, identify their high priority customer journeys, find new revenue sources, drive down costs and reinvent their operational model to offer innovative products that are future-ready and to gain a competitive advantage in the market. A connected customer experience born from an engaging front-end and a robust back-end is what will drive success for banks and corporates both, in the coming years.


  1. Scaling-Up SME Access to Financial Services in the Developing World, IFC
  2. BCG: Global Corporate Banking 2015
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