Evolving SME needs and advances in technology have lead to dynamic changes in the SME Banking industry. The path from start-up to corporate is no longer linear. The banking needs of small and medium enterprises (SMEs) are changing dramatically, and the banks’ responses need to evolve accordingly. Government and regulators are applying increased scrutiny to the segment to ensure that there is both innovation and competition in the market.
There can be no doubt that increased access to debt finance and supporting services is required. For example, there are now some 5.5mn SMEs in the UK (representing phenomenal growth in recent years). These SMEs have a turnover of £1.9tn, covering 51% of all private sector turnover in the UK. Likewise, we are seeing a growing market in Ireland with many diverse and complex needs; a market that needs better products, more tailored to financial services.
At EY, we believe this is a great opportunity for the market — not only those bidding for funding but everyone involved — to re-examine and re-imagine their propositions, putting the needs of SMEs first.
We think that it’s vital that traditional banks, challengers and FinTechs all look at how they can do things better. This is not just about tweaking existing products; it’s about having the right propositions and the right support and services. Digital is at the heart of the next wave of SME banking services. SMEs use digital platforms for their businesses and have every right to expect to have their financial services on these platforms too.
This is even more important with the advent of open banking changing the traditional competitor landscape. Firms need to make sure they can combine innovative digital and data offerings, alongside human advice.
In the below report, you will find a number of questions that firms need to ask themselves with respect to how they can really help the SME community, considering how they can provide additional insight, tools and services that will best serve their customers. Firms that answer these questions the best are likely to come out on top in the ongoing battle of attracting and retaining SME customers.
Click below to read the report – If you have a question about any of the issues raised, don’t hesitate to get in touch.