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Asset Range: < $1B |
Third-party app providers are winning over small business direct deposit relationships
To lock in customer primacy, your financial institution must offer products that enable business owners to accept customer payments that settle directly into their existing business account at your financial institution.
The challenge is that many business owners are turning to third-party app providers to receive customer payments. While many of those businesses may link to their business account at your financial institution today, that may not be the case tomorrow.
Business Accounts Accepting Deposits through Third-Party Apps
The below table shows the total number of business accounts analyzed that received an
incoming deposit from either Square, PayPal, or Venmo (third-party apps).
# of FIs
84
# of Connected Business Accounts
13,601
Total Monthly
Third-Party App Transactions
279,601
Total Monthly Incoming
Deposits from Third-Party Apps
$266,636,060.23
Evaluating the account penetration of third-party app providers
It’s not often that you can easily benchmark the influence a competitor has over your customer base, but in the case of third-party app providers, we can do just that.
If an account holder is accepting payments through a third-party app, you can likely draw two conclusions from their behavior:
They have a need to accept online or in-app card payments from customers, and...
They have an interest in digital solutions that are increasingly becoming an alternative
to the banking services you provide a business.
Financial Institution Benchmarks
The below analysis represents per FI averages based upon total incoming deposit activity from PayPal, Square, and Venmo.
# of Accounts per FI
162
% of Account
Penetration
12.2%
Total Monthly Deposit
Amount per FI
$3,174,238.81
Account Benchmarks
The below analysis represents per account averages based upon total incoming deposit activity from PayPal, Square, and Venmo.
# of Transactions per Account
20.56
Average
Deposit Amount
$953.63
Average Total Monthly
Deposit Amount per Account
$19,604.15
Benchmarking the Competition – Financial Institution Averages
The below analysis represents the total monthly amount of incoming deposits from PayPal,
Square and Venmo across all the FIs within each asset range.
PayPal
# of Connected Business Accounts
4,387
Total Third-Party
App Transactions
36,365
Total Incoming Deposits
from Third-Party Apps
$71,019,475.63
Square
# of Connected Business Accounts
5,069
Total Third-Party
App Transactions
202,607
Total Incoming Deposits
from Third-Party Apps
$176,750,594.07
Venmo
# of Connected Business Accounts
4,145
Total Third-Party
App Transactions
40,629
Total Incoming Deposits
from Third-Party Apps
$18,865,990.53
Benchmarking the Competition – Account Averages
The below analysis represents the total monthly amount of incoming deposits from PayPal,
Square and Venmo across all the FIs within each asset range.
PayPal
# of
Accounts
per FI
# of Accounts per FI
52
# of
Transactions
per FI
# of Transactions per FI
433
# of
Transactions
per Account
# of Transactions per Account
8.29
Average
Deposit
Amount
Average Deposit Amount
$1,952.96
Average Total
Deposits per
Account
Average Total Deposits per Account
$16,188.62
Square
# of Accounts per FI
60
# of Transactions per FI
2,412
# of Transactions per Account
39.97
Average Deposit Amount
$872.38
Average Total Deposits per Account
$34,868.93
Venmo
# of Accounts per FI
49
# of Transactions per FI
484
# of Transactions per Account
9.80
Average Deposit Amount
$464.35
Average Total Deposits per Account
$4,551.51
With any challenge, there is an opportunity
Enabling business owners to accept payments through your existing online and mobile banking channels creates an opportunity to generate non-interest fee income, increase deposits, and increase account engagement.
Generate non-interest fee income
Increase deposits and reduce deposit displacement
Increase small business primacy, engagement, and loyalty
Benefits for your small business customers
Potential cost savings for your customers
Accelerate cash flow & increase deposit balances
Next steps to take action on your report data
1.
Upgrade to Autobooks Premium Reporting* and gain access to a detailed customer contact target list:
- Account owner name
- 3rd party deposit transaction totals
- 3rd party vendor totals
*Learn more inside Autobooks Hub.
2.
Leverage the Autobooks
Enrollment Resource Kit:
Send a targeted campaign to educate customers on the benefits of getting paid through their financial institution app.
3.
Further refine your targeting with the Autobooks Signal Campaign:
Send the right message at exactly the right time to customers who are searching for a third-party solution.