A survey conducted by Fundtech has indicated that banks see the SME market as the one offering the greatest growth potential, with the majority of respondents seeing evidence that non-bank players are taking business away from them in that sector.
137 banking executives from over 100 financial institutions were polled at the vendor’s annual North American Insights conference in June.
Those surveyed singled out mobile banking services for SMEs as the service with the greatest growth opportunities, with 95% of bankers describing the untapped potential of the SME market as equal or greater than any other present opportunity.
Six out of ten said SME clients now demand new services on a regular basis, while almost 20% said that the demand is “unprecedented.”
For this reason, 38% said they are looking to prioritise the development or expansion of their mobile banking channels for SMEs while reducing the cost of servicing this segment.
Six out of ten participants stressed there is evidence of non-bank competitors taking away business from them in the SME segment.
The survey also highlighted banks’ major concerns, putting regulation and compliance at the top of the list.
These are fostered by an ongoing lack of clarity around what must be done to comply with new regulations such as Dodd-Frank, and the expectation that there will be additional regulations to follow.
Almost a third of participants said they were not sure what their department must do in order to comply. Six out of ten of bankers believe that Dodd-Frank will undergo major revisions in the coming years, and expects new regulations to come in.
Fundtech head of marketing George Ravich said the SME market offers an enormous growth opportunity to banks that understand their unique needs.
“For the millions of SMEs that consider their pick-up trucks as their offices, the mobile channel provides a compelling level of convenience and control. The key to success is offering this market segment well-designed options that are developed for the three major platforms-smartphone, tablet and computer,” he said.