...on How Banks Can Most Effectively Offer Digital Solutions
COLUMBUS, Ohio – Feb. 28, 2022 – BankiFi, a leading provider of embedded banking solutions, has released a new whitepaper in partnership with RedCompass Labs, a world leader in good and bad payments technology. Titled “SME Banking Channels: converting a money pit into a business opportunity,” the report explains the challenges banks face when offering digital solutions and how banks can most effectively and lucratively deliver cutting-edge technology.
The whitepaper found that, although most SMBs initially look to their financial institutions for payments and accounting services, most banks are unable or unwilling to provide solutions that are on par with third-party services. It further notes that a rise in open banking by about 30% shows that small businesses are increasingly turning towards third-party service providers.
It also reveals that, between technology costs and staffing costs, banks regularly struggle with the cost of ownership for their in-house digital channels. The report concludes by noting that banks are able to eliminate these costs by partnering with external service providers to offer top-of-the-line technology at the best price for the bank.
The whitepaper takes full inventory of the small business market in the United States, stating that small businesses make up 90% of all businesses in the country and employ roughly half of all Americans. The study also notes that small businesses in the U.S. spend about $225 billion annually on payments and accounting services.
“We’re seeing a real crisis for both financial institutions and small businesses,” said Keith Riddle, CEO of BankiFi Americas. “There is plenty of demand for payments and accounting services among small businesses, but financial institutions are disincentivized to offer those solutions given the current state of the market. Through external partners like BankiFi, banks can have the best of both worlds, offering the best technology with minimal cost to the financial institution.”
Kjeld Herreman, Head of Strategy Advisory at RedCompass Labs explained that, “In our discussions with financial institutions, it became apparent that it was quite challenging for them to quantify the costs and the benefits associated with their SME banking channels. We’ve developed a model for banks to better understand these drivers in order to refine their channel strategies for this important client segment.”
About BankiFi BankiFi is on a mission to help over two million SMBs globally by 2024 through partnering with financial institutions to provide technology designed to make business banking better. BankiFi’s platform enables financial institutions to provide a set of integrated services – financial account access, accounting, invoicing and payments, and cash flow forecasting – designed around the processes SMB and trade customers use to run their business. It equips financial institutions to become customer centric, rather than product centric, increasing their revenues (direct and through actionable insights) and reducing costs. BankiFi’s offices are in Ohio, Manchester, Sydney and Antwerp. For more information, visit https://www.bankifi.com/.
About RedCompass Labs RedCompass Labs is committed to helping open the doors of finance to all with our payment expertise and data-led technologies, and to protecting all who enter – most specifically by disrupting financial crime that affects the most vulnerable. RedCompass Labs has invested in technology tools to support their clients during all stages of the complex journey through payment transformation programmes. The company has also developed the RedCompass Labs RedFlag Accelerator, the global point of reference of modern slavery, human trafficking, and Child Sexual Exploitation red flags for the financial industry. The RedFlag Accelerator won the PayTech For Good award and Themis Anti Financial Crime Innovation award.Today, RedCompass Labs supports its clients from five offices in London, Warsaw, Brussels, Singapore, Tokyo, and Miami. To learn more, visit RedCompassLabs.com.