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Financial Services for Small Business Owners: Top 3 “Moments of Truth”

Top 3 “Moments of Truth” for Financial Services Companies Serving Small Business Customers in 2021

If you are a large enterprise that provides products or services to small business owners (SBOs), you know well how challenging this past year has been for your customers. From navigating the ever-changing rules around when and how to open stores, to re-inventing the shopping experience in order to follow COVID-safe protocols, SBOs have had to demonstrate outstanding agility, creativity, and resilience to survive.

Supporting small business owners is critical to the economy (99% of North American businesses are small or medium), and therefore it’s also critical to understand what kind of support they need. That’s why in February 2021 we partnered with B2SB (Business to Small Business) agency Cargo to conduct a study of over 2000 small & medium businesses in North America. Our research explored drivers of SBO purchase and loyalty behavior, and investigated what SBOs currently fear, forecast, want, and need from enterprise brands.

This article is the first in a series that will highlight key findings by industry vertical, i.e. Financial Services, Technology, and Logistics providers. Read on to learn about the top 3 moments of truth specifically for Financial Services firms serving SBOs. Based on answers to the question, “What is the most critical point where you need support from your business bank?” as well as additional insights obtained from some of our other quantitative & qualitative studies, we’ve gained a better understanding of how a corporation can stand out from its competitors and strengthen its customer relationships with this important segment. As well, we’ve developed a recommended approach for applying these insights to re-map the small business customer journey for 2021 and beyond.

#1 – Proactively Support Small Businesses with their Day to Day Issues

As reported by those surveyed for our 2021 State of Small & Medium Business study, the #1 most critical point where support is needed from banks is “Day to Day Issues”. More specifically, this includes transactions such as invoicing and payments, but is different from setting up an account or securing a loan. Over a quarter of respondents overall (27%) rated “Day to Day Issues” as number one.

These answers mirror findings from our 2020 State of Small Business Banking study presented in August 2020 for the Financial Brand, which listed the top 3 financial concerns as “Payroll”, “Rent/Mortgage”, and “Paying Invoices/Suppliers”. That same study also revealed that many small business owners were dissatisfied with the level of communication and support received from their banks. As of June 2020, 86% reported that their bank had not reached out to see how their business was doing, and 37% reported being “unimpressed” with their bank’s reaction to COVID-19. Fast forward to our 2021 study, and 33% still rated Customer Support as only “adequate”, “poor” or “very poor”.

The takeaway? Small businesses (who may already be stretching their resources and themselves every day) need and expect support from their banks to make their daily operations run as smoothly as possible. Proactive communication and offers of support from real people, as well as digital tools that make invoicing and payments easy and reliable would be welcome.

#2 - Ensure Digital Tools Pass the User Confidence Test

The critical moment in second place from our February 2021 survey was “Timely Transfers and Confirmations”. 20% of total respondents reported it as most critical, with an even higher proportion (32%) of businesses with 2-3 employees choosing this option first. It may not be surprising then to learn that 30% of respondents also rated their satisfaction level at 6 or below (out of 10) with respect to “ability to fully accomplish what you set out to do using digital channels”.

These findings suggest an opportunity for financial institutions to review their digital toolset for efficiency, dependability, and perhaps most importantly, User Experience. In our whitepaper, “The Future of the Interface”, Phase 5 Partner Arnie Guha discusses the concept of the User Confidence Test in developing new tech-based capabilities for customers. In addition to creating a good experience, he explains, corporations need to ensure customers feel completely assured that their needs have been fulfilled, e.g. that their transaction was processed.

“People still phoned into call centers after they were given the option to reach out for support online. This often comes down to a sense of user confidence in the new channel they’re being offered.”

In the case of small business owners with limited cash flow and negligible margins for error, it is easy to understand the importance of a reliable financial services provider who not only delivers as promised, but removes any nagging doubt or stress as to when or whether payments have been completed. Furthermore, in addition to ensuring user confidence in timely processing capabilities, banks must continuously reinforce user confidence in data privacy and security practices at the same time.

#3 – Don’t Rush New Account / Service Set Up

Number three in terms of the “most critical point” where small business owners need support from their bank is “Setting Up Accounts / Services”. 14% of respondents overall ranked it first, with an even higher percentage of businesses sized 2-3 employees choosing it first (23%). Perhaps related to this data point are two others from our February 2021 survey: 95% of respondents said they prefer to keep the majority of their banking services with the same bank, however only 63% actually use the same bank for both their personal and business banking needs.

Of course small business owners are also consumers, so the same individual may represent 2 distinct banking customers. The findings above suggest an opportunity to allocate additional resources to new account/service onboarding, with the goal of learning more about the customer at that key moment, and then deepening or broadening the customer relationship as a result. The large majority of small business owners say they would prefer to consolidate their banking services with one institution; how often are banks offering them an easy opportunity to make this happen?

The concepts from #1 and #2 above can also apply to moment #3. On the day it needs to happen, account/service set up might be considered a “day to day issue” which a small business owner needs to resolve quickly in order to get back to the real business operations. Banks should be available to offer support in the form of efficient, dependable tools combined with a personal touch where needed. And for those small business customers going through purely digital channels to set up something new, ensuring a user experience that they can be confident in will help make this critical moment go smoothly. Perhaps an automated follow up communication would show support, build confidence in the system, and leverage an opportunity to deepen the relationship.


For Financial Services providers who are serving Small Business Owners, we know from our February 2021 study that the following 3 service interactions are the highest ranking “moments of truth”:

  • Day to Day Issues
  • Timely Transfers and Confirmations
  • Setting Up Accounts / Services

Our findings suggest that banks have many opportunities when it comes to their small business customers. More specifically, banks can proactively offer more regular support (in the right combination of human and digital), revisit user experiences to ensure they consistently instill trust and confidence, and take advantage of new account/service set-ups to learn more about each of their SBO customers and identify any unmet needs.

While these opportunities may sound broad, research can help to define the customer base, map the customer journey, and identify key points where a change would yield results. Phase 5 can also recommend a Customer Journey Mapping approach (leveraging the Jobs To Be Done model) that is proven to improve customer experience. Working together, we can optimize investment by directing resource allocation to the areas that will have the greatest impact.

Please contact us to learn more about any of the above studies, or to schedule a discussion about your specific business challenges.

Written by Stephan Sigaud

Stephan Sigaud, MBA, is Phase 5’s EVP of Marketing. Stephan is passionate about partnering with clients to address their challenges and opportunities around customer centricity. Stephan has more than 25 years’ experience in Market Research and Customer Loyalty and Experience and is a Board Director of the Insights Association. He has also been volunteering with the Customer Experience Professionals Association (as past Chair of the CXPA Toronto Network) and the Canadian Marketing Association (as member of the Leaders Network and past co-Chair of the CMA CX Council).