ECNETNews reports that a new partnership has been forged between a leading technology solutions provider and a modern digital payments processor, aimed at significantly boosting digital payment services for small and medium-sized businesses (SMBs) through community and regional financial institutions.
This collaboration will empower financial institutions to offer SMBs cutting-edge payment solutions, such as contactless payment acceptance via mobile devices, same-day funds availability, and automated reconciliations with existing accounting software. These features will be seamlessly integrated with the institutions’ deposit and core banking services, enhancing operational efficiency for SMBs.
Enhancing Services for Community Banks and Credit Unions
The innovative approach stems from a commitment to modernize technology, allowing community banks and credit unions to adopt cloud-native, API-first services. This strategic advancement will enable these institutions to differentiate themselves, compete effectively, and adapt to the shifting demands of their customers.
With an emphasis on minimizing fragmentation for SMBs, the initiative aims to centralize relationships between businesses and their banks. This focus is particularly timely, as SMB deposits are notably higher than individual retail deposits, aligning with financial institutions’ goals to grow their deposit base.
Responding to the Needs of Small Businesses in America
Recent statistics indicate that approximately 33.3 million small businesses operate in the U.S., making up 99.9% of all U.S. firms. However, a survey identified that a significant percentage of small businesses primarily bank with the four largest banks, highlighting a gap for smaller financial institutions.
Recognizing this opportunity, a recent strategy survey revealed that the majority of financial institutions plan to enhance their offerings for SMBs in the coming years, with a strong focus on expanding payment services.
The new service rollout will occur in phases, with beta testing anticipated to commence by mid-2025.
