Show Notes
The U.S. is home to 36 million small businesses—99.9% of all businesses—and roughly 11 million of their owners are already credit union members, according to Velera’s CU Growth Outlook 2026. The opportunity, then, isn’t simply to win new small business members. It’s to turn existing relationships into deeper, more valuable ones.
In a PaymentsJournal Podcast, Velera’s Vice President of Marketing Carrie Stapp, and Vice President of Product Management Sheba Carnes, as well as Brian Riley, Co-Head of Payments at Javelin Strategy & Research, discussed how credit unions can capitalize on this opportunity. That means finding the sweet spot between big banks and single-service fintechs—combining the personal service and community connection that small businesses value with the tools and capabilities they expect.
Developments in the Market
The growth of the small business market comes at a moment when credit unions are facing slower consumer loan growth, greater competition for deposits and continued pressure on margins. Serving small businesses can help address all three challenges: They need lending, they need to maintain operating deposits and they need to use a variety of payment services that create additional revenue opportunities.
And this market is growing in ways that play to the strengths of credit unions. AI technology has lowered the barriers for entry to small businesses, allowing entrepreneurs to launch faster and operate more efficiently with smaller teams. With fewer people on staff, these businesses are more likely to turn to outside experts—including their credit union—for help with areas such as payments and data analysis. As those businesses succeed, credit unions should position themselves to grow alongside them.
“Many business owners have been forced to look elsewhere as their business grows and their financial needs become more sophisticated,” said Carnes. “We see the industry having a tremendous opportunity to evolve and to become the financial partner that the businesses don’t outgrow.”
This is especially important because small businesses rarely rely on just one financial institution. Velera’s study found that 86% of SMBs use multiple financial institutions, with the average business using three. One reason, perhaps surprisingly, is that small business accounts tend to be sticky: Once a business begins working with a financial institution, there is little incentive to switch.
As a result, credit unions are not necessarily losing these SMB relationships to other institutions; they are sharing them. The challenge is getting a larger share of the relationship, particularly as a business’s needs become more sophisticated.
That’s where credit unions can begin to fall behind. As small businesses grow, they increasingly look for reporting and analytics capabilities, more advanced business rewards programs and payment solutions that allow them to seamlessly move money in and out of their businesses while tracking finances and inventory. If a credit union can’t provide those capabilities, another financial institution or fintech can fill the gap.
Personal Service and Beyond
This is where one of the credit union sector’s traditional strengths becomes especially valuable.
Credit unions have always excelled at service, and small businesses especially value having a personal relationship with someone they can call when they need help. That relationship can give credit unions a meaningful foothold with business owners, but it can’t be the entire proposition.
“Winning on trust, service and relationship banking is something that the larger financial institutions and the fintechs are going to have a hard time replicating,” said Stapp. “That allows us to be the differentiator, especially when those small business owners are looking for the consultation and the location of their bankers to be there to help them set everything up and to grow and adjust with their needs.”
Personal service alone is no longer enough. Cr
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