Where to Focus – Product Enhancement or Digital Access Improvement?
By Dave DeFazio
Nearly every banker will tell you improving digital banking access to products and services is a top priority.
In most cases, this results in just better access to the same look-alike products (namely checking and savings accounts) that have been provided for years with no new features or benefits.
But what about prioritizing product enhancement to go along with it? Products are a frequently overlooked area as the efforts and resources tend to be just on better access.
Banks and credit unions must innovate products as swiftly as digital access or risk becoming mere spectators as those who do both are rewriting the rules of financial engagement.
Digital and some mega banks have been steadily chipping away at traditional community banks’ and credit unions’ market share with consumers and small and midsize businesses (SMBs) with product innovation as an equal or sometimes as the primary focus. Chime, for instance, reports 8.6 million active users (March, 2025) who average 54 monthly transactions, making it one of the nation’s biggest financial services providers in terms of users.
These digitally native platforms continue to gain traction among younger clientele, drawn by features such as early payday, linked savings and investment accounts, and rewards. These and other features are ones that community FIs have been slow to replicate.
Innovation doesn't necessarily mean creating entirely new products, says Kirk Coleman, president of Q2. "I can take traditional products and add a lot of ingredients that make them feel fresh and extend the brand promise in a meaningful way.”
Making the Pieces Fit
FIs have an opportunity to create products that resonate deeply with customers/members simply by addressing their unique life circumstances and providing practical products with benefits that enhance their financial well-being.
"The innovation might be how FIs put the puzzle together,” Coleman explains. “Maybe what makes products that haven't seen that much innovation much more useful, more sticky, and more meaningful involves putting them together to help customers—whether an individual or a business—live their best financial lives in a very specific way."
Some FIs, including BankPlus in Ridgeland, Mississippi, are looking to expand their product set beyond traditional offerings. The bank recently launched a series of business products that include cybersecurity features and ransomware protection.
“You cannot ignore economic trends when you talk about what you're doing with products,” says Rob Armour, the bank’s chief marketing and product development officer. “We created a product
mix that is not only valuable to the customers, but it's also timely given the types of headlines that small and midsize businesses are seeing right now.”
Triumph Financial in Dallas is another example of a bank taking an innovative approach by strategically tailoring a digital banking product suite and platform to serve the logistics industry. Central to the strategy is LoadPay, a platform designed to provide a user experience—and financial products—for carriers. The product set is tailored to the financial needs of smaller trucking companies and brokers who pay the carriers. It includes tools and services to boost automation, mitigate fraud, create back-office efficiency and improve the payment experience.
Triumph has made strategic acquisitions to strengthen its position within the ecosystem, including Isometric Technologies Inc., which specializes in supply chain performance analytics, and Greenscreens.ai, a pricing platform that uses machine learning for real-time freight pricing. These acquisitions allow Triumph to address immediate payment concerns and provide valuable pricing insights, critical for brokers and carriers managing unpredictable market conditions.
Triumph’s strategy is “to transform data into actionable intelligence for the freight industry,”
CEO Aaron Graft said in a recent press release. The acquisitions are designed to lay “the groundwork for performance-based intelligence” and “expand...into pricing intelligence."
It Starts with the Interface
Digitally native banks, and select banks and credit unions, have figured out how to become known for easy access to products that cater to specific communities of modern consumers. The app becomes the identifier of the product for consumers. That is then followed up by a genuine product that is actually different from the myriad of FIs competing for consumer and small business market share
Jim Burson, a partner at Cornerstone Advisors, underscores the transformative potential of this integrated product-delivery model: "With digital platforms like Chime and Cash App, the distinction between product and delivery has become irrelevant. The app itself is the product—it manages payments, loans, and other financial activities seamlessly."
This convergence presents a challenge for traditional FIs that are still bound by a more fragmented approach to products and services. In other words, they spend most of their time on a better experience accessing the product/services without actually improving the product/services. This increases the risk of flight by younger customers and prospects, who have come to expect a certain level of functionality and modern curb appeal from their financial providers’ product sets.
Roughly 55% of millennial-run small business owners said they would prefer banking with a community financial institution if they offer similar product capabilities to what is provided by bigger banks, according to a first-quarter Apiture survey conducted by Datos Insights.
The survey also reveals a significant willingness among small businesses to switch institutions for better payment capabilities: Half would change banks for more diverse payment options, and more than a third would do so specifically for real-time payments.
Apiture’s findings further emphasize that non-traditional banking features are highly valued, with three-fourths of respondents willing to pay for effective financial management solutions— contradicting the prevailing industry notion that small businesses resist paying for bank products/ services, signaling untapped opportunities for traditional financial institutions.
Building a Financial Ecosystem
Burson emphasizes the urgency of shifting toward solutions-oriented banking: "Banks and credit unions need to reframe their products in terms of outcomes and solutions, rather than isolated financial transactions. Solutions-based marketing and tailored product offerings, designed around specific communities or industries, offer compelling value that customers will actively seek out and be willing to pay for."
“Every individual is different,” Coleman adds. “Stages of life would vary as well.”
Indeed, Triumph’s targeted approach to logistics mirrors successful strategies used by companies like Square, which offer comprehensive solutions encompassing payment processing, inventory management, and point-of-sale tools. By aligning their products explicitly around the unique needs and operations of their customers, these financial services providers effectively differentiate themselves in a crowded market.
Coleman echoes this sentiment, highlighting the role of customer-centric innovation.
“I don’t need 27 apps on my phone—I need one app with my primary banking relationship, where I can see everything I need about my financial life and embedded services under the umbrella of a trusted relationship,” Coleman says. “If a customer can manage their entire financial life through a single trusted relationship—rather than fragmented across multiple apps and institutions—banks and credit unions can achieve stronger loyalty and sustained market relevance."
However, financial institutions must acknowledge the cultural and structural challenges associated with such a strategic pivot. Burson points out that, for many of them, entrenched operational models and fragmented product strategies can impede innovation. The shift requires significant investment not just in technology but in education and internal cultural transformation.
Capital One provides a case study of successful adaptation, Burson says. Historically non- traditional in its banking approach, Capital One strategically streamlined its offerings around deposit gathering to fund credit card loans, effectively leveraging digital platforms to transform its market position. Platforms such as Capital One Shopping and Capital One Travel augment the customer experience.
Employee buy-in is also important.
“It is essential to encourage customers to engage with the product in some unique way early in the ownership process," Armour at BankPlus says. "The key to success lies in ensuring that frontline employees not only understand the product but genuinely believe in the benefits or even use it themselves. The real moment of adoption occurs when the customer has that first value experience in real life which is almost always facilitated by something they learned from one of our employees."
Ultimately, the move toward innovative, integrated banking solutions is not merely a technological upgrade but a fundamental strategic realignment of both product and digital platform access. Traditional FIs must reorient themselves around doing both with easy access to clearly defined, targeted solutions that address specific financial needs of consumers and businesses alike.
“You have to change the dialogue to solutions,” Burson says. “That starts with solution positioning. The smarter FIs these days are nimble, strategic, and data driven when it comes to product and digital platform changes. Ultimately that’s what it is about—those who figure it out first are the ones that will be more successful.”
Dave DeFazio is Chief Strategy Officer at StrategyCorps, a Nashville-based firm that provides financial institutions across the U.S. with mobile and data solutions that protect and grow customer relationships. Connect with him at dave.defazio@strategycorps.com or on LinkedIn.