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Banks to turn attention to small firms next year, study suggests

Nov 13, 2011 Walt Wojoiechowski

Despite a recent wave of public criticism hurled at banks over the imposition of new checking and debit card fees - not to mention their slow pace of lending to small companies - a new report suggests financial institutions plan to increase their small business focus next year. A recent survey by research firm Novarica shows more banks are planning to focus renewed spending on technology in the small business sector. According to Matthew Josefowicz, partner and managing director of Novarica, mid-size banks are investing aggressively in analytics, straight-through-processing and social media for small business in 2012. "This research confirms what we're hearing from bank retail and small business executives as they increase their emphasis on improving their retail customer mix," said Les Dinkin, a partner at Novantas. "Given this investment trend, we expect to see a significant ramp-up in bank small business go-to-market activities during 2012." Michael McEvoy, head of banking research at Novarica, pointed out that investments in analytics and processing are paramount to small business lending. As new technologies and data sources proliferate, the need for equipment financing may become more pressing.