JPMorgan Chase hopes that added convenience and less paperwork will help the banking giant broaden relationships with small business clients.
The $2.6 trillion-asset company is looking to streamline the experience for small businesses, said Jenn Piepszak, who became the firm's chief executive of business banking earlier this year. She has been charged with finding ways to make her department, which oversees deposit-gathering and lending, more cohesive from a customer perspective with credit card products and merchant processing.
"When you start a small business, you have a vision, you have an idea, have a ton of passion," Piepszak said in a recent interview. "The next thing you know you're doing a bunch of administrative tasks and you're not doing what you really, really love. One of those things is banking."
The effort, which Piepszak said could take a year or two to fully implement, speaks to a bigger point for JPMorgan. The massive company is pouring a lot of resources into demonstrating that the value of its size lies in its ability to leverage multiple products to its customers.
Such a strategy should produce revenue growth, Piepszak said.
"All my revenue upside is going to come from having deeper relationships and the way to deepen it is to make it worthwhile for them," she said.
"There are 28 million small businesses in the U.S.," Piepszak added. "We have relationships with 4 million of them. Sure, I would love that number to be 6 or 8, but more importantly, we would rather have those 4 million have their entire relationship with us."
Deepening client relationships could also help JPMorgan Chase target businesses with less than $100 million in annual sales. At many bigger banks, the line is often blurred between commercial banking, which tends to focus on large credits, and more retail-focused consumer banking.
"We realized we had a huge opportunity that we are leaving on the table" with smaller firms, Piepszak said. "And we knew the only way to capitalize on it is to deepen the relationships."
Making it worthwhile means cutting paperwork. The best example for Piepszak is the application process. JPMorgan Chase's small business clients currently have to fill out separate applications to open a deposit account, use merchant processing and receive the bank's Ink credit card.
"In this day and age, you'd think filling out any form is unnecessary," she said. "For a lot of very necessary reasons we need to know a lot about you to do business with you. We should only ask you those questions once. Today, we ask those questions three of four times depending on how many products you use."
Having a client's whole relationship is the "holy grail" in small business banking, said Nick Miller, president of Clarity Advantage, a firm that advises banks in their efforts to reach small businesses, their owners and employees.
Technology is likely at the heart of those efforts, making it easier for banks to be competitive, Miller said. Technology has also given rise to alternative lenders that have been able to give customers fast credit decisions.
Alternative lenders, while not yet a threat, are introducing game-changing technology, Piepszak said.
"The technology is extraordinary and provides a customer experience that big banks don't offer today," she said. "We can't ignore that."
Given the changing landscape, it makes sense for banks like JPMorgan Chase to remove friction from its multiple product advantage.
"Selling a full package to a business owner is incredibly important because it is very easy for me to look for best-in-class solutions individually," Miller said. "But if you have an integrated package, that can be strong enough to overcome any individual weaknesses."