Why Small Business Owners Might Be Ready To Switch Banks En Masse

There is a concept in journalism called “burying the lede” where you hide the most important part of a story somewhere down the page instead of putting it front and center. It's usually not a good idea. As I was reading an article about Amex's new partnership with Kabbage to disrupt the banking status quo, an interesting stat popped up:

According to PwC, 22% of small businesses are considering switching banks. Although you might think that those businesses that received Paycheck Protection Payment (PPP) loans from their financial institution would be the most loyal to their bank, in fact, the opposite is true. PPP loans didn’t make small businesses stickier to their primary financial institution: Four times as many of those small businesses that say they would switch actually applied for PPP funding.

If the numbers are correct and nearly one-fourth of all small business customers are considering switching banks, this is a HUGE opportunity across the financial industry. In a sector where there are many reasons why people generally don't make big changes, you might even consider this a once in a generation opportunity. So this deserves the headline. It's buried in this particular story, but if you work in financial services, you are hopefully already working on it. And if you're a small business owner, this might be the time to actually make that change to a new bank if the incentives are right.