Small business relief programs have held bankers’ undivided attention lately. What was once considered a largely underserved segment in the financial industry is now at center stage.Businesses are relying on their banks now more than ever before to provide the relevant financial tools that they need to survive. But the responsibility does not end with lending. Bankers Read More
COVID-19 has disrupted our communities and cost us greatly, but it has also breathed new life into our sense of community and improved how we communicate and work together. Banks are no exception; they are a great example of acting fast to serve their communities.As a part of an unprecedented effort to protect small businesses, financial institutions Read More
Cash is the original real-time payment. In fact, more than 27 percent of all payments are still made in cash, according to the most recent study from the Federal Reserve. That stat may surprise digital enthusiasts but for millions of consumers and small businesses, cash is critical to their day-to-day life. Who uses cash these days? More Read More
Is growing the small business loan portfolio on your bank or credit union’s agenda? If so, you’re not alone. A recent survey by the American Bankers Association found that 61 percent of banks surveyed plan to moderately or aggressively grow their small business lending (loans between $3 million and $100 million) over the next two years. In other words, many financial institutions Read More
Small businesses represent banks’ best opportunity to grow deposit balances, improve spreads and obtain overall superior relationship profitability. So why do so many small business owners feel a bit like the girl so attractive that she can’t get a date for Saturday night? Many are turning away from banks: more than 20 percent of small businesses that Read More
Banks know, perhaps all too well, the growth strategy of targeting small-to-midsize business clients (SMBs) to win over more of their fee-generating accounts. That trodden path for banks of all sizes dates to at least the wake of the financial crisis. And it’s not always a path to riches: A recent BAI Industry Insights presentation at the Read More
Growth remains a universal, timeless goal for financial institutions and many pursue loan growth to offset rising compliance costs and maintain profits. Yet those loans also undergo constant examiner scrutiny, meaning banks must employ prudent underwriting and review strategies. That noted, one strategy works toward both a bank’s growth goals and risk management requirements: lending to quality, Read More
More and more, transparency occupies the online lending industry spotlight—but it’s no highlight. The Federal Reserve’s 2016 Small Business Credit Survey found that half of all businesses were dissatisfied with online lenders due to a lack of transparency, while an overlapping half singled out high interest rates and unfavorable repayment terms. Unfortunately, some online lenders have combined Read More
It’s little wonder that small businesses mean big business for today’s banks and credit unions. Small businesses are mushrooming. The 28 million small businesses in America account for 54 percent of all sales, according to the U.S. Small Business Administration. Meanwhile, they’ve added jobs at twice the rate of corporate America over the past two decades. No Read More
There are 28 million small businesses in the United States. Let’s take a closer look at that number: It comes to one business for every 11 or 12 people in the U.S. Clearly, this market is ripe with opportunity. And yet, reasons abound as to why banks haven’t fulfilled small business loan requests. For starters, small business Read More
Make no mistake: Competition for small businesses is heating up among big banks, credit unions, alternative lenders and every institution in between. Small business owners now field a barrage of ads, direct mail pitches and sales calls that promise fast funding access. The competition then heats up when you add these ingredients: low interest rates, business investors Read More
The 29 million small businesses in the U.S. account for 54 percent of the country’s sales, according to the U.S. Small Business Administration. And in a digital era gone entrepreneurial, the small business sector is also growing, with more startups and declining rates of failure. Yet if at least some vital part of the small business space Read More
Small businesses have long mystified banks. They make up an overwhelming 99 percent of all businesses—yes, 99 percent—and employ close to half of all workers. They generate more than 60 percent of the private sector’s net new jobs. Yet despite the critical role small businesses play in the economy, most banks struggle to generate strong returns from Read More
Small businesses constitute the civic backbone of our communities and largest drivers of job creation and economic growth. The U.S. Small Business Administration estimates that 28 million small businesses in America account for 54 percent of all U.S. sales and provide 55 percent of all jobs. Yet, small businesses today face a range of challenges, including numerous Read More
Thousands of small businesses emerge nationwide every day. In fact, the Kauffman Foundation, a national entrepreneurship nonprofit, recently revealed that there are now 310 entrepreneurs for every 100,000 adults in the U.S.—which translates into 530,000 new business owners every month. Despite this sharp rise, the Small Business Administration reports that approximately half of businesses fail within the first Read More
A small business owner doesn’t want to wait weeks for a decision—and today, they know they don’t have to. When it comes to securing a loan, small businesses today claim no shortage of options. And the proliferation of online and marketplace lenders has led to a significant result: Many bankers now question their competitive posture. Leading Read More
Bank marketing is no longer just a matter of pushing credit via traditional advertising. Many bank marketers today are shifting the focus of their activities to advising, educating and otherwise engaging with small business owners seeking financial services. “In the old days, it seems every time we talked about small business we would use the tagline, ‘America’s Read More
It’s no secret that small business loans historically offer small profit; in fact, there is little economic difference in funding a $100,000 loan versus a $1 million loan. However, even though these loans may not always be the biggest movers to a bank’s bottom line, this type of lending is essential to establishing and building lasting relationships Read More
One way for banks to increase banker productivity and per-customer profitability is to better link their commercial and private banking/ wealth management efforts. Serving both the commercial and personal wealth requirements of a business not only builds revenue but also increases account stickiness and improves client retention.Only after starting my own business did I realize how intimately Read More
Over the past year, the alternative lending industry has taken several steps forward and, then, a big leap backward. The most notable step forward centers on the relationship between OnDeck Capital and JPMorgan Chase & Co. Chase now leverages OnDeck’s technology for its small business loans. This relationship, among others, has helped to focus senior bank managers Read More
