For many small to medium-sized businesses (SMBs), access to credit is essential. These enterprising companies are often at the mercy of a cash flow that doesn’t always align with bills, invoices, and other payments that pop up throughout the month. Often, they rely on credit cards to cover the gaps. As a result, more and more SMBs are turning to their financial institution (FI) in search of a credit card program that helps alleviate their cash concerns.

More than just a credit card, an increasing number of SMBs are looking for modern card features such as instant issuance, seamless integration with accounting systems and flexible spend controls for employees. In the age of digital transactions and growing fears of cybersecurity, SMBs want a digital-first credit card that’s easy-to-use, accessible, and secure. The question is: can you offer it?

Access to capital is critical

SMBs need access to capital—whether for everyday purchases, to cover cash flow, or even as a relief valve for unexpected situations. The digital acceleration of the past few years has impacted their business models, and SMBs are rethinking their payment processes. It’s a nearly ubiquitous need, according to this data:

• 83% of small businesses use credit cards to pay for business expenses
• 90% of SMB owners without business credit say it would positively impact their business
• 64% of SMBs intend on relying entirely on digital payments within 10 years

SMBs recognize the full breadth of resources available to them—and who provides those resources. An FI willing to offer accessible, digital-first business credit cards far outshines a competitor who turns the same SMB down for a conventional line of credit.

For FIs looking to attract and retain SMB clients, it comes down to offering the credit products your customers will get extra value from.

Why is a digital-first credit card program so important?

While modern credit card programs pave the way to more than accessible credit for SMBs—they also open the door to numerous mobile-first features and benefits that reflect positively on the financial institution offering them. Digital is synonymous with quickness, control, insights, and a host of other benefits that make sense for SMBs, including:

• Easy application for employee cards with real-time approvals 
• Ability to set spend limits and controls for each employee card
• Robust reporting tools with integrated expense tracking
• Real-time usage monitoring
• Customizable rewards programs beyond cashback programs 

By providing and supporting the SMBs with digital technology and giving them guidance on rewards and benefits, the cardholders perceive more value from their card by paying their balance monthly, redeeming rewards and using card benefits, according to J.D. Power.

Even beyond these enhanced benefits, digital SMB credit card programs unlock new opportunities for financial management. These features and benefits culminate into a level of transparency that helps SMBs feel more in-control and confident when it comes to accessing credit and managing their business finances.

FIs are poised to attract and retain SMB clients

There’s both strong need and open interest for digital-first credit cards among SMB owners. But not all SMBs know about the benefits of digital credit cards, or have the time to investigate them. The onus is on financial institutions to introduce and educate their small business customers. As they do, these FIs can look forward to growth in the number of SMBs they serve—and in the number of accounts these businesses maintain with them.

Consider the ecosystem effect that’s inherent to many financial products. Making it easy for SMBs to get the perfect credit card program up and running quickly opens the door to other products within an FI’s repertoire of services: business checking and savings accounts, traditional lending, financial advisory services, and more.

Consider this: FIs who cited a focus on small business deposits grew more than 30% in 2023, compared with 2022 (72% versus 41%). As emphasis on SMBs increases, card programs can be a conduit to continued customer/member loyalty and growth for an FI.

Establishing yourself as a full-service financial institution makes it that much easier for business customers to choose you as a unified solution, instead of cobbling together products and services from providers. FIs that offer customizable credit card programs are poised to capitalize on wallet share among SMBs that are ready, willing, and eager to use their new credit.

Be the enabler of small business growth

FIs are constantly seeking high-value SMB clientele. Likewise, SMBs are on the lookout for FIs that empower their growth through access to the right financial products. Digital-first business credit cards are the bridge that brings these two groups together. They’re simple, configurable, and lucrative for FIs, while at the same time enabling, convenient, and crucial for businesses. It’s a perfect match—and one that’s bound to define the SMB lending landscape in the years to come.

To learn how Deserve can partner with you to launch a SMB credit card program, check out our website or schedule a demo with us.

For more information on how SMBs are rethinking their payment processing and seeking modern card solutions, download our white paper: Building a Business Card Program in Today’s Digital First Landscape.