An overwhelming number of SMEs are currently fed up with the level of service they get from their business banking. New research from card issuing platform Margeta has revealed that 84% of business owners are frustrated with the performance of their bank.
Nearly a third (30%) also expressed dismay with the time it takes for financial institutions to make lending decisions and felt similarly frustrated about the inflexible credit offered by banks.
The National Federation of Self Employed & Small Businesses (FSB) has already issued a warning that up to 250,000 SMEs are at risk of folding over the next 12 months. The research confirms that more needs to be done to help businesses suffering from the economic downturn.
Banks are therefore being encouraged to do more to remove unnecessary barriers and offer more help for the SME community. The survey found that almost four-in-five (78%) SMEs have become more reliant than ever on digital banking services in the wake of Covid-19.
As a result, almost nine-in-ten (89%) are now calling on banks to offer improved digital services within the business banking marketplace. If the situation doesn’t improve 67% of SMEs told the survey that they’ll consider moving to another business bank account provider.
Key improvements requested during the survey by SMEs included the ability to track income and expenditure in real-time from their business bank accounts (82%). Meanwhile, 80% wanted to be able to send, pay and track invoices directly from their business bank account (80%).
In addition, 77% had the desire to integrate their business banking with other systems including their accounting software. Those questioned felt it would help speed up decision-making on business loans.
“SMEs are craving digital banking experiences, but have previously been limited by what’s on offer. In the onset of the Covid-19 pandemic, digital channels became the only way for SMEs to manage finances, apply for loans and make payments – so they had to adapt, and they aren’t keen to go back to the old ways,” explains Ian Johnson, Managing Director Europe at Marqeta.
“At the same time, new and innovative fintechs, like Tide and Capital on Tap, have entered the scene offering a frictionless digital experience to SME customers. Challenger banks like Starling Bank, Revolut and Monzo have also launched business banking propositions which are driving up SMEs’ expectations around business banking, which may create a perfect storm.
If banks don’t act now to improve existing digital services, they risk losing a vital revenue stream as customers switch to other providers with better offerings.”