Providing financial management services for small businesses can be a lucrative opportunity for banks.

However, today’s marketplace has become crowded with fintechs, megabanks, neobanks, and other nonbank competitors who leverage banking-as-a-service to offer traditional financial services like deposits and loans – making financial services a commodity that small businesses can get from an array of capable providers.

If your bank is going to attract, earn, and retain your market fair share with commoditized commercial services, there are three things you can do to stand out in the crowd:

  1. Leverage your enviable distinctions over non-traditional virtual competitors. You are uniquely positioned as the trusted, accessible, service-driven provider of vital financial services. You also have a physical market presence with names, faces, and relationships that clearly differentiate you from apps or portals. And your fundamental commitment to enabling the financial security and stability of the people, businesses, and communities you serve inherently sets you apart.
  2. Do a competitive analysis to ensure your interest rates and fee structure are highly competitive with traditional and nontraditional providers. Consider implementing a bundled pricing strategy to make it easier and more cost-effective for small businesses to use more of your integrated services.
  3. Further differentiate your commercial offerings with modern, high-value, digitally accessible solutions – like integrated receivables. These will become operational necessities for small businesses and help them survive.

The importance of integrated receivables

Although digital innovations altered the way most small businesses operate, receivables management is more labor-intensive, time-consuming, and error-prone in the digital era – especially for the 25.7 million owner-only small businesses.

Most businesses now receive checks and disparate digital payments, which must be aggregated and processed. And most digital payments are received without remittance information, so they must be manually matched to accounts receivables.

Small businesses need automated straight-through payment processing for all payment and remittance types. Integrated receivables will enable them to:

  • Consolidate all receivables, payments, and remittance information in a single platform.
  • Fully automate the entire receivables process and eliminate manually processing, reconciling, sorting, endorsing, and posting receivables.
  • Automate, aggregate, and simplify payment processing across all payment channels and types.
  • Seamlessly match electronic payments with remittance data.
  • Support disparate remittance documents including payment vouchers, stubs, envelopes, correspondence, and coupons.
  • Generate accurate, consolidated reporting.

Integrated receivables and the ability to virtually eliminate receivables management and processing challenges and expedite payment processing will become a necessity for small business owners, helping them improve cash flow and increase access to working capital.

Adopt a modern commercial strategy

The strategies that historically attracted and successfully retained small business customers must change to respond to disrupting competitors, technology-driven business solutions, and the digital-driven expectations of business owners.

You need a modern commercial strategy that utilizes your core competencies as a community financial institution and prioritizes the ability to provide highly competitive, differentiated commercial services.

By offering a state-of-the-art integrated receivables solution, you can position your bank as an advocate for small businesses – and that will give you a true competitive advantage.