It’s a mistake for financial institutions to not offer commercial and small-business card programs. If businesses don’t obtain the desired card program from their current institution, they’ll seek it elsewhere—and this not only jeopardizes the immediate relationship but also opens the door for competitors to capitalize on the opportunity.

During a recent PaymentsJournal podcast, Bob Zeena, Head of U.S. Credit Solutions at FIS, and Albert Bodine, Head of Commercial and Enterprise Payments at Javelin Strategy & Research, discussed how offering commercial and small-business card programs as part of a financial institution’s comprehensive service offerings can lead to new business and increased profits.

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Strategies for Offering Business Card Programs

When card programs are offered, it’s important to have a dedicated strategy that considers a company’s customers and how to best serve them.

“If your customers primarily consist of small businesses, you should consider a card program that is similar to consumer cards,” Zeena said. “This could include rewards-based features that allow smaller businesses to make transactions easily, whether it’s in-person (card present) at places like Home Depot or online (card not present) at platforms like Amazon.”

However, for larger or midsize businesses—such as commercial enterprises—the approach is different. According to Zeena, organizations will need to provide compelling reasons for their customers to choose their card program over alternatives.

“Consider the three R’s for commercial and small-business cards: rewards, rebates, and reporting,” Zeena said. “You may offer all three or a combination of them to make your program attractive.”

Business Cards Offer an Attractive, Longer Payment Cycle

Small businesses value having a longer period to pay their bills rather than instant payments that take money out of their accounts in just a few seconds. It’s important for financial institutions to remember this, especially as they develop strategies for the SME sector.

“Working capital is a key concern for small businesses,” Bodine said. “They want to manage their cash flow effectively, which means having the flexibility of extended payment terms.”

Although instant payments may be popular, working capital is a vital component for small and larger businesses.