5 Ways to Keep and Attract Commercial Clients

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It’s no longer enough for banks to provide clients with standard products and services. Clients are constantly looking for differentiators when deciding which financial institution to trust with their business. Whether your clients are baby boomers preparing for retirement or millennials interested in purchasing their first home, everyone wants their bank to make them feel special.

When implementing any initiative, strategic marketing is key. Your clients need to be aware of, and excited by, your incentives — one benefit can set your institution apart from competitors. Below are five benefits for banks to consider.

1. Partner With Other Companies
Partnering with other companies like gas stations, grocery stores and retail brands gives you a way to offer rewards to clients when they purchase their essentials. Plus, your bank will enjoy free marketing and awareness as part of the collaboration. Banks can also increase their trust, credibility and relevance when they partner with businesses that clients already know and use. For example, Bank of America Corp. offers a customizable cash back credit card that offers 2% back at grocery stores and wholesale clubs.

2. Connect Clients to Capital
Often, clients are unaware of programs that can net them working capital, like the Employee Retention Credit (ERC). ERC providers are highly qualified professionals that help clients navigate the ERC process and can work with banks to help their commercial clients collect an average of $400,000. This is another example of an alliance that’s mutually beneficial: Clients gain back money they’re owed, while the bank receives referral commissions from its agreement with a trusted ERC provider. Banks can also benefit from the goodwill built between the institution and the client.

3. Offer a Loyalty Program
A loyalty program can provide clients with compelling, ongoing reasons to continue banking with your institution. Going a step further, your institution can add different tiers of rewards that incentivize clients to take advantage of each initiative. One great aspect of a loyalty program is that banks can customize it according to clients’ unique needs, creating a personalized offering that resonates with them. As an example, Kasasa Cash and Kasasa Cash Back function as a checking account, plus include monthly rewards like exclusive savings at different stores and restaurants.

4. Provide Enrollment Incentives
To encourage potential clients to sign up with your bank, consider offering exclusive rewards only available for new clients. From exclusive discounts to no sign-up fees, there are many ways banks can provide value up front to people deciding between institutions. For example, Citigroup’s Citibank is giving new clients up to $2,000 when they open a checking account by Jan. 9, 2023.

5. Implement Digital Banking
For banks with ample resources, a digital banking app is a great way to further improve your clients’ experience. Providing a more streamlined way for clients to manage their finances allows your bank to create greater value that other institutions may not be able to offer. Digital banking allows clients to interact with your bank wherever they are, at any time. Some features your bank may want to include are:

● Disposable virtual card.
● Credit card transaction disputes.
● Recurring bills.
● Chatbot support.
● Digital account opening.

Helping Commercial Clients Access New Tax Credit

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Helping commercial clients is also an opportunity for banks to increase fee income through a partnerships.

Commercial clients can access a payroll tax refund through the Employee Retention Credit (ERC); ERC providers that specialize in navigating the process can partner with banks to offer this service and increase their noninterest fee income and deposits.

The ERC was born out of the 2020 CARES Act, which is the same relief bill that created the Small Business Administration’s Paycheck Protection Program (PPP) loan. PPP clients may qualify for the ERC, which gives banks an opportunity to monetize their PPP client list. The ERC is easier for banks to implement than the PPP since it is not a loan: it is money that businesses are entitled to receive from the government. Once companies receive ERC funds from the U.S. Department of the Treasury, it’s the business owner’s money to keep.

Initially, the ERC tax credit was available to companies whose operations were fully or partially suspended from March 13, 2020, through Dec. 31, 2020. Back then, the maximum refund a company could receive was up to $5,000 per employee. Then, Congress made several modifications:

1. The Consolidated Appropriations Act extended the ERC to include wages paid before July 1, 2021. The maximum ERC amount was increased to $7,000 per employee and quarter.

2. The American Rescue Plan Act of 2021 included wages paid between July 1, 2021 and Dec. 31, 2021.

3. As of Sept. 30, 2021, the retroactive appeal of the ERC affected businesses that were originally scheduled to receive the ERC from Oct. 1 through Dec. 31, 2021.

Who Qualifies for the Payroll Tax Refund
Thanks to the payroll tax refund, banks that partner with an ERC provider can help their clients capture these rebates, benefiting from the higher deposits in their clients’ accounts. The IRS estimates that tens of thousands of businesses are eligible for the refund, which is available to both essential and non-essential businesses that were impacted by the pandemic. If a company experienced disruptions to commerce, travel or group meetings, it likely qualifies.

When banks empower their commercial clients with business opportunities they can take advantage of, both parties benefit in several ways, including:

Stronger relationships. Helping their commercial clients claim their payroll tax refund gives more trust and credibility.

Expanded services. Banks can set themselves apart from their competitors by offering assistance with navigating the ERC qualification and refund process.

Growth opportunities. With more noninterest fee income and deposits, banks can increase their budgets for other initiatives that help move their business forward.

While business owners may be tempted to go to their CPA to find out if they qualify, it’s recommended to go to an ERC provider that understands the intricacies and nuances involved in assessing eligibility. Choosing a highly qualified professional gives commercial clients a potentially higher refund amount than if they went to a general practitioner.

Banks that partner with an ERC provider can help their commercial clients navigate the payroll tax refund process easily and quickly. This partnership can then expand to additional services that allow banks to scale their commercial client base.