NU Online News Service, May 6, 2003, 3:40 p.m. EDT – Twenty-one percent of small businesses will be banking online by 2005, thanks to improved technology, business owners’ increased comfort with the Internet and financial institutions’ growing interest in small business, concludes a new study by Celent Communications Inc., Boston.
Although banks often see the small business market as hard to reach, they are starting to realize the segment has great revenue potential, Celent says in a new study about technology vendors catering to the small business banking market.
Many banks are now battling for market share in this sector, Celent says.
The 25 million U.S. small businesses tend to be more loyal as customers than large corporations, Celent says. Moreover, small businesses “offer several cross-selling opportunities to banks as they grow,” says Christine Barry, the Celent analyst who wrote the report.