The good news: Business credit cards are an important product for small businesses. Almost 70% of small businesses use credit cards in a typical month and over 50% designate a business credit card as their primary card for business expenses.
The wake-up call: While 26% of small businesses with a primary small business credit card report having a relationship with a community bank, only 2.9% have a business card with a community bank.
The opportunity:
- Small businesses actively shop for business credit cards, creating an opening for community banks to gain share: 38% of small businesses that have credit cards for business expenses shopped for a new or additional business credit card in the past two years. Moreover, 69% say they are at least somewhat likely to shop in the next two years.
- Demand for small business credit cards can be created: Shopping is triggered and informed by receiving offers/promotions from credit card providers
- Many businesses are receptive to getting a business credit card from a Community Bank: 26% of businesses likely to shop in the next two years say they would consider a community bank as the small business credit card provider. That number reaches 48% among those that already have a banking relationship with a community bank
- Community banks show higher success rates… if they are in the consideration set: Among small businesses that shopped for a business credit card in the past two years, two-thirds of those that considered a community bank ended up selecting one. Moreover, 80% of small businesses that have a small business credit card with a community bank consider that card to be primary.
- When it comes to community banks, small businesses value more than just the card offering: When considering a community bank as a credit card provider, small businesses tend to focus on a very different set of priorities. The top reasons for considering a community bank were attributes of the bank itself, including personalized service, convenience, and local presence and involvement, as opposed to offering characteristics (e.g., rewards program, pricing, line of credit).