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The Consumerization of Technology’s Impact on Business Banking Solutions, Culture and Mindset
As innovation shapes industries worldwide, business owners’ expectations are also evolving to align more closely with the streamlined, user-centric experiences they encounter in their personal interactions. This shift, fueled by the consumerization of technology, underscores that business leaders—who are also tech savvy consumers—expect similar efficiency, transparency, and personalization from their financial service providers. To successfully attract and retain these valuable account holders, financial institutions need to deliver market-leading business banking solutions that serve both the enterprise and the individual behind it. However, that may be easier said than done. Which begs the question, what defines business banking digital maturity? And, how does the market stack up?
After surveying 150 digital decision makers from banks and credit unions across the United States, research analysts benchmarked the data and Alkami’s Business Banking Digital Maturity Model revealed four key cohorts when it came to digital maturity in business banking – Cautiously Modernizing, Optimistic Believers, Emerging Pioneers, and Tech Titans.
Unpacking the Four Cohorts of Business Banking Digital Maturity
Cautiously Modernizing
| Overview
The Cautiously Modernizing cohort is primarily made up of small banks competing with other local institutions. They often believe they prioritize technology, but in reality, they consider it a challenge rather than a competitive advantage and end up investing less than other financial institutions. |
Opportunities for Expansion
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Optimistic Believers
| Overview
Optimistic Believers are mostly credit unions that believe they have competitive business banking solutions compared to other regional and community financial institutions. This cohort’s strength lies in their heavy investments towards the end user experience and sub user account management. |
Opportunities for Expansion
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Emerging Pioneers
| Overview
The majority of survey respondents fall into the Emerging Pioneers segment and are mostly banks of larger asset sizes. These institutions are focused on using digital for account sales, offer modern payment, and have strong accounting & ERP integrations. |
Opportunities for Expansion
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Tech Titans
| Overview
Tech Titans’ are typically larger institutions and their data-first mindset trusts data over experience. They are the clear market leaders when it comes to their digital experience and have mastered driving sales across digital and branches. |
Opportunities for Expansion
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These four distinct cohorts illustrate the varied paths financial institutions are taking toward business banking digital maturity. Whether aiming to keep pace with tech leaders or driving digital transformation through data-driven insights, each institution has a unique starting point and set of opportunities ahead of them.
However, mastering digital maturity is not solely about adopting technology; it’s about using it strategically to transform how financial institutions serve and engage their business customers and members. Digital maturity leaders often skew larger in asset size, however, one in five leaders has less than $1 billion in assets, showing that smaller institutions can outperform larger ones. Conversely, over one in five of the least digitally mature financial institutions hold more than $10 billion in assets, proving that size alone does not ensure digital leadership. As institutions progress through each stage of business banking maturity, certain core strategies become essential to unlocking deeper value for both the institution and its account holders. Regardless of where an organization stacks up against the Business Banking Digital Maturity Model, to take the next step towards establishing a competitive edge, financial institutions must commit to innovation or risk being left behind.
The Keys to Achieving Business Banking Digital Maturity
According to Alkami’s research, business banking digital maturity can be accomplished by focusing on these three pillars:
- User Experience
For many banks and credit unions, offering digital account opening, accounting system integration, sub user management, and basic money movement capabilities has quickly become the norm and expected functionality in today’s business banking market. However, the institutions that stand out as leaders are those that go beyond these basics—investing in enhanced user experiences that make these core functions faster, more intuitive, and personalized for business clients. By focusing on elevating the usability and efficiency of these essential capabilities, these institutions position themselves to capture and retain business account holders in a highly competitive market.
- Employee Productivity
The most digitally mature financial institutions recognize that delivering exceptional account holder experiences starts with empowering their employees. By streamlining workflows, reducing friction points, and automating traditionally manual processes, these institutions free up employee time and enhance productivity. Financial institutions who invest in their employees’ access to technology and data infrastructure experience stronger banking relationships and faster execution.
In 2024, it is anticipated that Generation Z workers will outweigh the number of Baby Boomers in the workforce, meanwhile, millennials represent the largest generation in the workforce. This multi-generational shift places the needs and expectations of younger generations on full display for financial institutions – whether they’re an account holder or an employee.
To attract, retain, and cultivate the next generation of workers, banks and credit union leaders must invest in technology that empowers employees to succeed in their jobs, eliminates antiquated processes, and enables data-driven decision making. Introducing the right tools to the workforce is one thing, another component is a financial institution’s commitment to developing the skills of their employees and bringing in the best talent to enable a successful transformation. The majority of Tech Titans consistently upskill their existing employees and are not afraid to hire from outside the banking industry.
- Mindset
While market-leading capabilities help build an innovative toolset that may be considered mature, it takes a mindset and organizational culture to successfully deliver solutions out to market and to guarantee buy-in from internal teams. With strong leadership at the helm who is aware of the institution’s competitive gaps and is willing to take the risk because they believe in the value of the outcome, financial institution teams can move quickly and deploy a rapid growth strategy. Once they make up their minds, the most mature financial institutions act with conviction and execute with speed, keenly focused on deploying new solutions out to market.
By investing and focusing on the guiding principles of business banking maturity – user experience, employee productivity, and mindset, financial institutions can face risk head-on and accelerate organizational growth while better serving their customers and members.
