Top Commercial Banking Trends Business Owners Need to Know for 2023

December 23, 2022

Understanding the latest commercial banking trends helps business owners know whether they seek the right services and assistance from their commercial banking institution. Data-rich solutions are one of the most significant priorities heading into 2023. However, nothing compares to tailored advice. Personalized attention and custom solutions are paramount to success in the years ahead.

Business owners should remain aware of the following trends to ensure their needs are met, and goals are reached.

Innovation Will Remain Crucial

Dated products and services need an overhaul to benefit the businesses of today quickly and at scale. Although several areas are under transformation, few are as vital as procurements and payments, which rose to the forefront for business owners during the beginning of the COVID-19 pandemic. As technologies were implemented to combat new difficulties, business owners began to see the value of innovations like contactless payments and e-procurement or spend management platforms.

These innovations can also help business owners unlock efficiencies in other areas, such as treasury management. In 2023, there will be a greater emphasis on automation through adaptable platforms and ecosystems. While business owners cannot think through all the possible disruptions they may run into, partnering with a commercial bank that can act fast and help during challenging times is essential. Innovation will continue to be at the forefront of how commercial banking supports its business clients.

Hyper-Personalization

Personalization continues to lag between businesses and their commercial banking partners. Surveys indicate that many financial institutions are considered relatively poor at personalization, ranking fourth out of five industries. Business owners should expect a personalized commercial banking experience since each company has specific requirements that need to be met. In many cases, owners depend on personalization to help raise capital and provide competitive solutions for their customers.

So, while there will be a continued need for digital product and service innovation, personalized service, which is a core highlight of private banking, will remain a crucial factor among small businesses in their financial institution relationships. After all, that’s what commercial banking should be, a relationship-based business.

Moving forward, more than ever, companies will require personalized financial advice, hands-on support, and guidance when aiming to grow their bottom line — all of which drive customer satisfaction. Given the need for personalized financial services, it is surprising that only 44% of banks are delivering on this metric. The last thing businesses need right now are cookie-cutter answers, which is why consumers gravitate toward customized banking services.

More Fintech Collaborations

Fintech is getting its due attention from many businesses. Fintech startup companies raised $32.4B in the first quarter of 2022, supporting trends in 2023 across digital transaction innovations. The companies that can work with their commercial banking partner to offer customer-facing solutions that appeal to these trends stand to benefit in revenue efficiency and customer satisfaction.

For example, consumers increasingly rely on digital options to pay for goods and services. Introducing innovative services in the area of payments is one way a business can capitalize on this consumer trend. Contactless payments are one innovation that exploded in popularity over the previous two years. Enabling contactless credit, debit, and mobile payments can boost revenue efficiency and agility.

Data and AI Technology

Business and banking leaders agree that AI can bring a competitive advantage, yet adoption remains mixed. Again, it’s all about finding the right combination when merging technology with the human touch. This is true for companies managing customer relationships and finding and growing a healthy commercial banking partnership.

Among the reasons that businesses are not using more advanced data management and AI tools include the following:

• Lack of staff ability or limited AI expertise.
• Lack of trust that AI’s output is fair, safe, and reliable.
• Lack of data centralization or ability to feed AI tools pertinent data.

Some of the top ways that commercial banking trends can support better data management and AI adoption include generating insights through tailored financial reviews that can work to support greater connectivity and data sharing, as well as custom lending programs to facilitate the adoption of cloud and API technologies to deliver enhanced services and break down inefficient silos.

Exciting trends likely to take hold in 2023 and beyond include deploying AI and machine learning for prediction and decision-making processes within the financial arena and numerous other industries and a movement toward blockchain-based trade finance networks to eliminate operational friction and reduce compliance risks.

Connect With First Western Trust Banker

The current economic environment is complex and uncertain, which is why you need a partner you can trust. Whether you require capital to grow your business or employee benefit consulting, First Western Trust takes a holistic, customized approach to help you manage your company’s finances.

Contact our team to discuss your concerns, plans, and goals to build a beneficial partnership today.