Source: Shutterstock.A business banking experience is the future.
Sure, millennials have cornered the “experience market” with their expensive avocado-laden breakfasts, lavish vacations and enhanced demands on “evolving technology.” But with that come new demands for the business banking experience. Simple banking functionality, in which a business owner can check their account or make simple transactions, is no longer acceptable. Accessibility and experience are key.
These demand trends are likely to escalate over the next decade as younger, technology savvy generations take the helm at business organizations. As the new generation of executives start to steer the course toward their own definition of professional success, financial institutions are likely to see a number of changes.
The first will be demand for an increased depth and breadth of services. Currently, 69% of millennials want a commercial banking partner, and 89% want this partner to guide the business’ financial future with online tools to help with cash flow management, forecasting and budgeting.
Recent advancements in analytics and real-time service are already turning the credit decisioning process inside out, reducing the time it takes to process a loan from days to hours. Why not apply this streamlined innovation to what is vital to every business – holistic insights and payments?
The second change relates to current events. The pandemic has shed additional light on the need for alternative payment methods. However, this new drive for a different way to get paid could also solve the long-term problem of reducing account receivable cycles.
Imagine if you could offer your small businesses a virtual payment method. As a valued business partner, you could offer the local “Mr. Clean” an app to collect their monthly payments. Now, instead of collecting checks and going to the ATM or depositing remotely, Mr. Clean’s clients can download an app onto their phone. With a few taps of a button, from the comfort of their couch, they are able to pay from a card or a check.
Great for Mr. Clean’s clients. This saves Mr. Clean’s accountant time and reduces the risk of a “lost check.” But it can also provide analytics for the business. By digitizing the accounts receivables, businesses can not only streamline payments, but also gain valuable insights into predictive cash flow.
There are solutions out there that offer this service, but they are rarely integrated into the banking software. Businesses, and their financial institutions, are left piecemealing antiquated solutions together to maintain some semblance of insights. And insights, especially financial insights, are key to properly understanding and predicating changes to the businesses. True insights are only effective if you put in the work to maintain the data. But insights are only as good as the data you are mining from.
How can you ensure the integrity of that data?
With a steady stream. A business banking experience.
Creating a true experience means a holistic partnership. And the future is bright for the credit union/millennial relationship. According to Aite Group, millennial-run businesses would prefer to partner with their financial institutions when it comes to the financial operations of their business, and a greater number of millennial business owners are willing to pay for the business products and services they need to complete related tasks.
We just anticipate those needs. That means partnering with provider that has the business intelligence and data points. Look for a robust set of resources, such as historical transactions, outstanding receivables, a business wallet and payment tools offered through business banking experience.
Michael AbareMichael Abare is Senior Product Manager for Finastra in Austin, Texas.