The news: Wells Fargo is focusing on banking for small and medium-sized businesses (SMBs)—with a strong emphasis on customer experience and satisfaction, per Banking Dive.

The play: SMBs are a huge segment. The US had 33.2 million businesses in 2024, and 31.7 million were small businesses, per Clearly Payments.

By consolidating relationships, banks that serve businesses and consumers well can grow by cross-selling to customers across segments. Deposit accounts, cards, and lines of credit under one roof put Wells Fargo in a position of strength over competitors with narrower products and services.

Room to breathe: Wells Fargo’s growth was constrained by an asset cap that the Federal Reserve put in place via an enforcement action in 2018 and lifted this summer. With growth now an option after seven years of stagnation, the bank can lean into new or existing markets.

The bank says it has more than 3 million small business customers—by that measure, it’s captured less than 10% of its addressable market.

Expanding the pipeline: A challenge banks have had with serving SMBs, especially small businesses, is that their needs and expectations for financial services vary widely. Wells Fargo’s response has been to modernize SMB account opening and onboarding, attempting to meet expectations for the digital experience and smoothing customer acquisition.

This year, at the top of the funnel, Wells Fargo has reportedly made several changes, per Banking Dive, and more digital improvements are in the pipeline.

Advancements include:

• New account opening tools for deposit accounts and business lines of credit.
• Improvements to the card account opening process.
• A banker-assisted account-opening application.

Not just about banking: The problem with small business banking is that it’s about banking. Banks have a worsening record of making these banking relationships commerce-driven, in which they also offer merchant services and therefore struggle to deepen day-to-day propositions.