Fireside Chat: An Interview with U.S. Bank's Sekou Kaalund

Empowering Small and Mid-Sized Businesses: A Bank's Role in Local Economies

Financial institutions play a critical role  in supporting small and midsized businesses (SMBs) and local economies. In an up-close and thoughtful fireside chat, the  session will uncover strategies and insights aimed at solidifying the role of banks as indispensable partners in the SMB ecosystem. In today's economic landscape, discover how embracing digital transformation, leveraging data-driven intelligence, and fostering relationships can unlock new growth opportunities for banks as well as the entrepreneurs, families, and communities they serve. Insights include:

- Explore how an evolving banking model approach, centering SMBs not just as entities but as vital components of local economies and the livelihoods of individuals, is critical to maintaining competitive relevance.

- Examine operational and growth challenges many SMBs face, and how personalized, efficient, and scalable financial solutions address these issues to empower the people behind the businesses and strengthen the communities they serve.

- Understand how fostering deeper, more collaborative relationships with SMBs can create sustainable revenue streams and long-term loyalty for financial institutions, while directly contributing to the success of small businesses, individuals and overall community vitality.

Transcription:
Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio for the authoritative record.

Chana Schoenberger (00:08):
I'm Chana Schoenberger, I'm the editor-in-chief of American Banker. And so you're a host for this game show. And I have with me here, Sekou Kaalund, who is the head of branch and small business for US Bank in Minneapolis, but not actually in Minneapolis? I'm everywhere. You're global.

Sekou Kaalund (00:26):
And nowhere at the same time is fascinating.

Chana Schoenberger (00:29):
You live on a plane.

Sekou Kaalund (00:30):
Yes, exactly.

Chana Schoenberger (00:31):
Okay. So before we get started here, just tell us a little bit about yourself. How did you get here?

Sekou Kaalund (00:37):
I like walks in the park. Oh no, not that.

Chana Schoenberger (00:40):
Uber from the airport.

Sekou Kaalund (00:42):
Yeah. I basically, as she said, have the privilege to lead branch and small business banking. We have about 14 million clients, about 1.4 million small businesses, but those are all the stats. What is most important to me is the origin story around small business and why I'm passionate about it. My parents were small business owners and both of their businesses failed because of a lack of access to capital, a lack of access to small business banking resources. And so I've been privileged in my career, whether at other institutions or here, to just really be able to focus on how do you really support small businesses? And they mentioned some of the stats, but when you think about it, the 34 million small businesses are powering 46% of the actual jobs in the US. But what was fascinating: out of that 34 million, only six million have multiple employees. So there's just an immense opportunity to help small businesses scale. And that's what I'm excited and privileged to do across US Bank.

Chana Schoenberger (01:44):
Especially in a world where companies aren't hiring, entrepreneurship is increasingly going to be a thing that people have to do to support their families.

Sekou Kaalund (01:51):
Yeah, absolutely. And again, it was said, the good thing is you're going to hear some similarities because we are a bank and TD Bank's a bank and you had great research from Barlow, but that is a real opportunity for communities, local, et cetera, having people understand what needs exist in the community and what solutions they could bring to that. And just to then, as they said, be the engine to help drive that small business along their journey is critical.

Chana Schoenberger (02:20):
And you've worked at a number of other banks and you were a regulator for a bit.

Sekou Kaalund (02:23):
Yes. I was at the Federal Reserve. That was interesting when I started my career out of graduate school. I spent five years at the Fed. I was at JP Morgan for about 15 years and Citi as well. And again, a common theme throughout: everyone is really focused on how they can serve these small businesses. The difference is I think when you see your presence across large metropolitan, rural, et cetera, you do have to be tailored in how you support small businesses because those staffing models aren't the same in the branches. So it becomes really critical to understand what are the things we need to do to ensure that there are the resources, both from a small business specialist standpoint, but also the solutions and technology that can empower small businesses.

Chana Schoenberger (03:11):
Okay. And US Bank has also done a number of interesting things recently. You've got this partnership with Edward Jones that you announced.

Sekou Kaalund (03:18):
Yes. We had State Farm, Edward Jones, and the opportunity there is again, to have partnerships that enable us to reach more and more clients, whether it's through the sales force of other institutions like Edward Jones, but it's also aligned with how we're thinking about reaching more across the country. Like I said, 14 million clients, but there's just tremendous opportunity to support more and more across even out of footprint. We're in about 26 states, but we could do more across the country. And so that's what we look to do with these partnerships.

Chana Schoenberger (03:54):
But you have the best brand in America, right? US Bank.

Sekou Kaalund (03:59):
Yeah, it is a great name, obviously, but also it's fascinating that when you think about our original charter in the 1800s, Lincoln signed the charter. It was from one of the legacy institutions, but it's a bank that's been around. And again, it is a great name.

Chana Schoenberger (04:18):
Okay. So the big thing that's going on, and I think everyone will agree on this, in 2025, is economic uncertainty.

Sekou Kaalund (04:25):
Yes.

Chana Schoenberger (04:25):
Right. So we've covered this from all angles. There's the geopolitical situation, there's the question of GDP, inflation, interest rates. No one knows what's really going on. What is the number one thing a bank can do now to make your small business clients be able to ride through the storm?

Sekou Kaalund (04:43):
Yeah. I think when I say, I'll use the collective we—everyone in this room—the one thing we can't do is really influence or impact those things you mentioned: tariffs, economic uncertainty, et cetera.

Chana Schoenberger (04:57):
No.

Sekou Kaalund (04:57):
But what we can do, which was also mentioned, is ensure that we're having conversations with small business owners. Sometimes they don't know when they need credit, and typically they want to have those conversations when they need it. So how do you serve that small business to get them to think about the future more broadly and be part of their growth journey or solutions journey depending on where they are in the evolution of their business? I think the critical thing is really to have those discussions. As that research indicated, small businesses do want engagement and it varies by the segment—micro, et cetera. But one thing that is consistent is the engagement piece. So whether you need more complex solutions, treasury management, et cetera, or you just need a banker to help hold your hand as you're walking through, trying to figure out what you're going to do to respond to pricing, to hire, to navigate the uncertainty. I think the best thing banks could do now is to truly ensure that they have a model in which there is that connectivity with the small business versus just coming in as they believe that the small business needs something; be proactive instead of reactive.

Chana Schoenberger (06:13):
So I was speaking with someone here yesterday on a no names basis who said that the one difficulty that banks are facing is that the smaller the loan, the less time the banker is allowed to spend with the client. It's just not profitable to spend many, many hours helping this client through, counseling them through. How do you solve that problem? Is it a matter of connecting them to local nonprofits or business counseling?

Sekou Kaalund (06:42):
Yeah. There are two things I would say. The first is a question of what can you do to support small businesses where they are, including micro. There, we've launched basically a small business academy. It's our small business resources. And so the small business can go onto our website and see the types of things they need to think about from formation to later stage activity. So that's one piece. The other piece is how do you create solutions using technology so that you could do some of the smaller loans without having to, per se, have a banker hold your hand. You can do some simple equipment finance. And where the banker has been engaged, they already know that that's the trajectory that you're on. And so they could recommend and help you or make the resources available. And that's where technology becomes critically important in that micro sector, but not just the micro sector. Everyone wants to do things quickly and we just heard that. So it's important that you then have tools or the resources that that small business owner feels comfortable with, knows what they're going to do, and you're there to reinforce. I think that becomes the key. How do you, for small dollar loans, still have a system where obviously you have some automated underwriting, but you're able to actually make loans quickly. And that helps, I think, because you can't physically underwrite a whole bunch of $50,000 loans. But what you can do is, again, we have a large cards business. It's the same algorithm thinking that you can understand how to quickly underwrite.

Chana Schoenberger (08:25):
Okay. Because the problem is that the CEO of a small business is a person, right? And he's a person who has the Starbucks app on his phone. When he wants to do business with Starbucks, he just goes in and he Apple pays 10 more dollars for his latte, and they don't fundamentally understand why they can't do that with their bank.

Sekou Kaalund (08:42):
Yeah. And I think that's why you'll see a lot of FinTechs and why we do a lot of FinTech partnerships as well and acquire where it makes sense. But yeah, that is the expectation, whether it's that small business owner or the consumer, because a small business owner is a consumer. And that's what's exciting for me: that you have that intersectionality. You have a small business owner who, as they grow their business, needs wealth or they need consumer services, they need cards personally and for their business. And so they're bringing that same perspective. As a consumer, this is what I'm able to do: I go to Starbucks and I order. They have that same expectation of how a bank is going to deliver. In fact, sometimes it's heightened because when I'm leisurely getting my latte, I have more time, I'm multitasking; but every second counts as a small business owner because I am multitasking. So to really create greater efficiency is important. That really drives the trust and relationships. As I said, people do business with people that they trust. One way you build trust is being able to deliver efficiently, effectively, and consistently, and that consistency matters.

Chana Schoenberger (09:51):
So in terms of collaboration and partnership, right? Everyone in sales tells you they're doing consultative sales: let's figure out what the problem is and then we'll find a solution to it. How does a bank do that with small businesses? Every business is different. You've got the people making friendship bracelets and then you have small manufacturers and they're all served by the same division.

Sekou Kaalund (10:13):
Yeah. I think it's back to that recognition that even though we have 1.4 million small businesses, they're not all created the same. They have a different focus and a different segment that they're serving. So I think the broader opportunity is to understand what are the needs for a specific small business based on if they're a restaurant. Okay, what are our solutions there? If they're a dental office or a medical practice, how do we make sure that our solutions are truly tailored and then the banker, that small business specialist, could really understand and engage as necessary? For that smaller business segment, we launched business access advisors. They aren't salespeople. Their sole job is to help small businesses, whether it's post-formation or thinking about launching, and that becomes important because, to your point, there are 34 million small businesses. You can't have a model where you are serving all of them with a sales team, but what you can do is make sure that you're providing—via our website or via our business access advisors across multiple states—that opportunity to engage in those dialogues around business launch. As we said, you don't go into business to work with accountants and bankers and lawyers. You go into business because you were passionate about an idea that you know can either impact your community or represent a market need. I think by serving those smaller businesses on the spectrum of launch even to get them prepared, to teach them the answers to the test, it becomes ultimately critical. It makes it easier, as you alluded to in that last question, that perhaps someone's not credit ready now, but what's the CDFI network? That's another discussion with CDFIs, but CDFIs are critical. How can you then leverage some of the partnerships so that they could still have the opportunity to really get access to credit and still have those banking services as well?

Chana Schoenberger (12:17):
Right. So there's a lot of political uncertainty now too. Right now we don't have a government, but when the government comes back, presumably it will, some of these partnerships between the private sector or the public sector may be changed in form. CDFIs are, of course, one of them, we've covered that extensively. Can banks step in in some way? Is there another place to send small businesses?

Sekou Kaalund (12:41):
Yeah, I think now it goes back to whether you log onto our app—and I would say other banks I'm sure have the same in terms of, "Hey, if you need help during this time, here's who to contact." And then you leverage the proactive contact with our branches as well as our call center. We just named a new head of small business banking—I got my US Bank colleagues at the table there—so Heather is leading up small business. But one of the things we have to think about is how do you reach out to these clients? We have over 2,000 branches across 26 states, but in some of these rural places where you may not have another branch within 25 miles, how do you serve them? How do you have this national call center that can still do that proactive outreach? So it's really about fundamentally understanding your customers and what they may be going through at this time based on some of these conversations that we have or just in general leveraging tools. We have a cashflow predictor tool that we developed as well that can incorporate payroll and other data. That may be the trigger for a banker to reach out and help that client think about what is on the horizon based on what they're seeing. I think the biggest thing is you don't want to wait for that client to call you anxious. This is a real time that banks can step in and reach out because the things we can do will continue to provide these needed services and really have more frequent dialogues. Who knows how long this is going to last, but if it does last another X and you depend on some contracts for Y, here's how you should think about some lending or broader credit opportunities or cash flow management. I think it'll be very specific to that small business based on their client set, their pricing, and their vendors. It all has to be really aligned with who that small business is and what we can do for them.

Chana Schoenberger (14:43):
Okay. So I want to ask about real-time data because I think we all agree the world is moving to a real-time economy and real-time payments. Data is one example of this. How are you using real-time data to help small businesses right now?

Sekou Kaalund (14:58):
Yeah, it's all about data. So all the things we talk about, whether it being efficient, quick, et cetera—the cash flow too—it's all driven by data. The other piece is there is a lot of data. You could be overwhelmed by data, but how do you have a mechanism where either you're doing it together and you're helping that small business, or you have tools and technology that they could do themselves? Leveraging the data is critical. Candidly, all of the banks are technology companies too. We have just as many engineers for all of the solutions. Data's at the core to be able to anticipate clients' needs or at least enable them to think about aspects that they may be missing. So we leverage it in all of our tools and solutions, particularly cash flow, and then just having those conversations to understand what that small business is thinking about. Data is king at this stage.

Chana Schoenberger (16:01):
Okay. Yeah. I mean, I've heard Jamie Dimon say a number of times out loud that he is a tech company.

Sekou Kaalund (16:06):
Oh yeah, yeah.

Chana Schoenberger (16:08):
I mean, they spend more than a billion dollars on tech. And you probably spend nearly that much.

Sekou Kaalund (16:13):
Yeah. All of the companies, you have to invest in tech, whether it's for the fraud piece. The tech is great for all these institutions here, and the tech is just as great for the less altruistic actors in society who are committing fraud. The fraud schemes are now so much more sophisticated. Account takeover is using AI around voice. There was a story, I think out of Hong Kong, where AI imitated the treasurer's voice and got someone to wire money. So there are all these true examples, urban legends, but the reality is without leveraging technology to detect and understand, you will have more businesses losing money. And the thing about that example they gave in the last session, the 1.8 million being wired out—with many of these small businesses, some of them may not have 1.8 million.

Chana Schoenberger (17:10):
Sure.

Sekou Kaalund (17:10):
So you really impact, not only do you take down that small business, but some of those small business owners have leveraged everything—they worked at a company, they leveraged their 401k, they took out home equity lines before as they were trying to ramp up. And now when this small business goes down, it actually has the impact of taking down a family. I think it's critical that not only do we support with the right tools and technology to help prevent fraud where possible, but when I have that in the back of my head when I think about my own family and what they went through, what we went through, it can be impactful. And so with that, I'm even more motivated as we look at our portfolio, whether it's fraud tools or products more broadly. Driving small business, in my mind, is a great way to really shift and impact the economy to see the growth that happens. I've been able to see that as well. Many great examples: all large businesses started as small businesses. You see what's possible, it's exciting for me and I'm glad that we get to play a part in that.

Chana Schoenberger (18:26):
Yeah. I interviewed a banker at another one of our conferences who was saying that one of her clients was a small to midsize manufacturer in the Midwest and they were in the third or fourth generation of family ownership. The family CEO's fraud prevention technique was that he kept a desk in the accounting division and he would go down there every couple of days, sit at his desk and personally sign every check that went out. If he didn't know a vendor by name, he would pick up the check, walk over to the finance person's desk and say, "Who is this person? Why are we paying them?" She said to him, "We can automate this for you. We can automate it such that you can still approve it personally." And he said, "This is my fraud technique."

Sekou Kaalund (19:13):
Yeah. Automation is a good thing, but I could understand. It just shows you the fear and concern someone would have that a lot could go wrong. So how do you replicate that and give people the trust and the tools that exist? Another thing you just said: in terms of a generational business, we did our small business survey for 2025 where we talked to about a thousand small businesses, and it's just fascinating. That is another thing, in addition to tariff uncertainty—I could give you all the stats on that—but transitioning the business. Some of the kids don't want the business. They're thinking about selling the business. How do we use AI? Some say they're heavy in AI, others say they're overwhelmed by it. It's just fascinating from succession. We think typically about the concerns that all small businesses will have—my pricing, my supply chains, hiring—but this whole succession element is fascinating as well. Small businesses want to have these dialogues about how they think about what's next, which is fascinating because not every Gen Z or millennial wants to take over the business or they've already indicated, "No, I'm turning left, this business turned right." So that is another step where you can be helpful for a small business thinking about what they're going to do with succession.

Chana Schoenberger (20:44):
Well, it's interesting because when you think about the effect of the small businesses and the banks on the local economy, right? If you have a successful small business and the next generation inherits it and doesn't want to continue it, whoever buys it from them or takes it over from them may not have the same commitment to that local community, not having grown up there. And you see that with a lot of small towns that they've lost their manufacturing or lost their major employer because it became part of a larger company.

Sekou Kaalund (21:16)
Yeah. And I think the beauty of being in 26 states and many of the large cities in the country is that I also get to go to Idaho, Montana, Wyoming, all these beautiful places. downtown where I was talking with a guy about Missoula, which is a larger town because it has a university, but the small businesses are what actually drives when you're on Main Street. What Main Street typically means is it's that main street with all of the different services, whether it's the dry cleaner, et cetera. And so—

Chana Schoenberger (21:48):
And an Edward Jones branch.

Sekou Kaalund (21:50):
There you go. That's why that matters in terms of supporting that business that is really a part of the fabric of the community. What you'll have, same with the bank branch that has been there, is people who have grown up going into this bakery or going to this meetup, whatever it is. It's really part of the fabric of that community. So helping that business scale versus ultimately lose it or change becomes important.

Chana Schoenberger (22:20):
Right. But I mean, change is coming for everyone. Nothing is going to stay the same. So I'm interested in what you were saying a minute ago about fraud. This is obviously a major theme of every conversation we have with bankers of all sorts of clients: there are a ton of bad actors out there from very small physically based fraudsters to the most sophisticated bot firms. And what do you do about getting small businesses away from that? It's impossible to insulate them completely, but you don't want to lose money. They certainly don't want to lose money. You don't want to lose them as a client.

Sekou Kaalund (22:57):
Yeah. I think personally, even the number of texts that I receive... explaining to my mom why you shouldn't respond to that. "Why'd you let them in on your computer? What is going on? And why are you calling me now? Why didn't you call me before?" But that's a separate story. That is the same pressure that this small business is under. They're dealing with day-to-day survival, and so everything can be crafted as an opportunity. It's not that someone is just twiddling their thumbs and saying, "Oh, let me click on this link." They are very sophisticated campaigns. They actually will make you think that they are a supplier that's offering a great deal and all you have to do is X. I think the biggest thing you could do is really invest in that client education. Whether that's in your own tools or in your resources on your website to talk about the types of schemes that are constantly happening. The other part where it's harder to do, I will acknowledge with a lot of customers, but knowing that customer's activity—as that banker, we've seen that really make a difference in preventing some of the fraud because we're able to see pattern recognition because we're looking over a large client base. Really sharing some of those insights in advance as well in terms of what is happening, I think helps many of these small businesses because they don't have the resources. We begrudge in some of the large banks having to do all your training. There's a training for the training. You go through a lot of training and these small businesses really don't have access to that. So it's important to push out data and insights. I'm even fascinated by the emails I get from banks in which I don't have an account telling me to... So it just shows the research that some of these bad actors do to know everything about a small business, to think of what would work, what would be convincing or compelling to get them to let their guard down. That's why tools and sharing information—and we do share in general—banking institutions understand what's happening and what we're seeing, just so we could protect customers.

Chana Schoenberger (25:22):
Yeah. I think a lot of the problem also is that people are used to behaving in a certain way and they don't stop to think, is this situation different? I interviewed a banker once where they had a big project to... It was an AI thing. They were using AI to determine on which dates there would be problems with fraud based on... This was for a trading business. Based on the calendar, they found that there was more fraud when seniors were on vacation; somehow the fraudsters knew that they were going away or maybe it was a holiday weekend. They had all these parameters put in. And then on a day when your desk would be susceptible to fraud, every time you typed something in at the bank, you would get a popup that said, "Heightened risk of fraud, slow your communications, recheck all numbers, don't do it quickly." And that was enough to stop people and say, "Hey, I always pay this counterparty, but is the routing number the same this time?"

Sekou Kaalund (26:27):
Yeah. I mean, back to the sophistication, whether that example or AWS, you name the thing.

Chana Schoenberger (26:35):
That was a problem for us too.

Sekou Kaalund (26:37):
As soon as that happens, they have crafted the scheme that they're going to use. It is fascinating. You're like, "Why can't you use your power for good?" But they are certainly looking for clients to have their guard down, and everything looks as it should, as one would think it would, without that deeper review. When you're doing 20 things at once, unless you're reminded, it feels like you get into the routine. This is the same provider. I'm not looking at this small change here.

Chana Schoenberger (27:08):
Joe Smith, he's my guy...

Sekou Kaalund (27:10):
Yeah. So that's where customers have to be diligent, but banks have to also alert them and leverage technology so that it makes it easier every now and then to remind them to check.

Chana Schoenberger (27:23):
Yeah. Or something as simple as when you get a communication from the bank—if they call you, if they email you—just politely hang up and call the number on the back of your credit card.

Sekou Kaalund (27:35):
Yeah. And that's the great thing about having such a large consumer base because we've seen every version and soup de jour of fraud examples, and you're able to take some of those highlights and push it out in terms of what are the best practices. When you receive this type of email or when you do receive an email purporting to be US Bank—or any bank—here are the things you should think about. I think the fact that all of the banks have some type of solution becomes important because you do have customers that bank with multiple banks. If we're reinforcing... For me, this is just about how do you protect small businesses from being defrauded. So it is important to ensure that the insights and information are out there.

Chana Schoenberger (28:22):
Definitely. Okay. So what is the ROI on all of this for you other than bank revenue, deposits, loyalty? Is there another way to measure the importance of small businesses to a bank?

Sekou Kaalund (28:34):
I have my own little measure: ROC, return on community. How is that small business scaling in the community? Another way we could look internally is how are we serving that small business? Is it just a single product client? If we have greater depth and are working with them across a number of products, then most likely we'll have all the insights to anticipate what those lending needs could be, when there's fraud, how we help grow and scale, how we help talk about different supply chains, et cetera. So depth really becomes the ROI for us—that you're not just providing one service, just a card client here, just a checking account there. You're providing value add, not just in the solutions, but they're leveraging some of the technology piece. I'll pivot to a consumer really quickly. We have this Cobrowse feature where it's almost like FaceTime being in the app where you could walk the consumer through things. We had a similar product on underwriting loans for equipment finance where you get to see that you may be in your truck pulled over on the side of the road and we're actually going through your loan and executing that. I think the ROI is when you see that customers are taking advantage of the technology that you've invested in and that you're able to provide more and more of what they need. For me, that is the measure: how we're serving them more holistically versus just a single product.

Chana Schoenberger (30:05):
So return on community, how do you calculate that?

Sekou Kaalund (30:08):
Well, see, that's why I said that was my measure. But how you calculate that is how you're scaling businesses. When I look at the business that we started serving five years ago, and when you do a relationship review, what are the things that we're doing as an institution that's supporting their growth trajectory and how have we been a part of that dialogue? The return on community is more, in my mind, a framework, because if you're serving small businesses and helping them scale and grow, by definition they're driving growth and job creation in that particular community. I think having that lens—again, that's a lens that I like—is captured in everything we measure from multi-service depth, client growth, et cetera. But that's the big "so what" for me. Scaling businesses means we're creating jobs. Back to that six million of 34 million: only six million have employees. What if that number went to seven, eight, or nine million? That is an ROI because that's an ROI that's creating job growth across the country.

Chana Schoenberger (31:07):
And if you do it well, someday they need your investment banking services and their CEO needs your wealth services.

Sekou Kaalund (31:16):
There you have it. I agree.

Chana Schoenberger (31:21):
Thank you very much.

Sekou Kaalund (31:22):
Thank you so much.