Community banks have always specialized in catering to small business owners, extending credit and providing a multitude of depository and investment products.
Small businesses continue to be the backbone of the American economy, generating 60 to 80 percent of all new jobs over the last decade. To help these companies thrive, community banks are developing more innovative and responsive ways to handle their needs. Here are the top five trends I've seen emerging in the area of small business banking:
1. Remote Deposit Capture - Probably the most pervasive current trend at community banks is the adoption of remote deposit capture (RDC) technology to allow business customers to deposit their checks from the comfort of their desk via a scanner-type device and an Internet connection. This technology makes a lot of sense for small business customers because they don't have to leave their business to rush down to the bank by 2 p.m. to make deposits or pay an employee to make the deposit when that employee could be doing something else to generate business. Especially now that gas prices have risen to unprecedented highs, RDC is a way to save small business banking customers time and money.
2. Online Banking/Bill Pay - Although community banks pride themselves on pursuing personal relationships with business customers, savvy business owners demand the efficiency and convenience of the Internet. With more than half of the U.S. household population now banking online, online banking and bill pay have achieved mainstream acceptance. Our recently upgraded commercial banking system allows customers to transfer funds, stop payments, set up multiple user access, make tax payments and schedule loan payments.
3. Corporate Credit Cards/Merchant Credit Card Services - Companies are increasingly turning to corporate credit cards to replace more traditional labor-intensive and inefficient paper payment procedures. Corporate credit cards can help companies centralize spend control and maximize processing efficiency.
4. Identity Theft Solutions - Although identity theft cases are beginning to drop - down 12 percent in 2006 according to Javelin Strategy & Research - that is no reason to let down our guard. In fact, it is partially because of banks' increased awareness and scrutiny of suspicious activity that this epidemic is slowing down. To protect our customers, we will stay vigilant and keep offering ways to reduce the chances of becoming a victim through online banking and online billing. These services reduce the use of paper documents which are used in 90 percent of identity theft cases.
5. Succession Planning - Our final small business banking trend capitalizes on what community banks do best - develop relationships. With half of all small business owners reaching age 65 in the next 10 years and turning over their businesses to the next generation, we will have an increasing number of opportunities to help our customers and the new owners of their companies make that transition.