TSB bank is working with a Silicon Valley startup, which was co-founded by Twitter CEO Jack Dorsey, to equip small and medium-sized enterprise (SME) customers with software enabling them to take card payments and run other business processes.
Through tech firm Square, TSB’s business banking arm will offer SME business customers a card reader for people making payments in-person, as well as point-of-sale software.
After processing payments, the software will enable SMEs to apply analytics to payments, manage inventory, send digital receipts, and issue refunds.
Square carried out research of UK SMEs and found that three million small companies do not have the technology to take card payments. The research also showed that SMEs that have started accepting card payments have seen their profits rise, on average, by up to 25%.
Catherine Douglas, business banking director at TSB, said: “We know that managing finances is often one of the key challenges for our business customers. Our partnership with Square means that our customers can manage their finances more easily and better serve their own customers.”
One SME that has been using the TSB and Square tools and services is Bespoke Trade Frames, based in the West Midlands, Its co-founder, Stuart Bates, said TSB offered 18 months’ free business banking, which helped to reduce costs and get the business started.
“We then needed a simple way to accept payments and track sales,” he said. “Through TSB, we were able to sign up to Square, which was quick and easy, and now we’re able to accept all major cards and get paid on the next business day.”
“This partnership will allow us to provide those businesses with access to the credit and debit card economy, often for the first time, so they can accept any way their customers want to pay,” said a Square spokesperson.
Fintechs are developing services that are scalable, which small businesses can make use of. Big banks can work with these fintechs as resellers, offering their own business customers accredited third-party services. This reduces the number of B2B services that banks have to develop themselves, which cost more than working with a fintech.