Banks who do not build their own platform infrastructure will likely join third-party marketplaces, but potentially lose out on a new revenue opportunity.
Following the five steps described above — implementing conscious digitization, perfecting their brilliant basics, transforming credit processes, embracing data for personalization and supporting the entire SME ecosystem — will ensure that banks remain relevant to a fast-changing and increasingly demanding SME world. More than that, by leveraging data and removing traditional silos, they can create new avenues for income, mitigate risks and truly tap into the SME opportunity.
These trends will also kickstart a necessary cultural change in the SME banking sector, from short-term returns to long-term profitability. This is a transformation journey that is both fluid and ongoing, but banks can support it by ensuring they attract and retain the skills needed, as well as by implementing relevant governance mechanisms, such as aligning financial rewards with good practices. If the industry can manage a deep and long-lasting culture shift, there is no doubt that the future is bright for the SME bankers of tomorrow.
The latest EY insights have revealed how SMEs have been impacted by the pandemic, and the five key areas where they need their banks’ support.