Rewriting the Commercial Banking Playbook
Landing and Expanding Commercial Relationships through Digital Banking - 2Q25
Square now holds an average of $35,000 in deposits from mid-market businesses— funds that traditionally resided with community banks.
This isn't an isolated trend but part of a systematic strategy by fintechs to capture traditional commercial banking relationships. Jack Dorsey himself highlighted Square's "accelerated adoption among larger sellers" in their latest earnings call, with mid-market businesses now representing their fastest-growing segment.
Our collaborative research with 15 banks across the country reveals a concerning pattern: commercial banking customers are increasingly splitting their financial activities between traditional banks and specialized platforms that integrate seamlessly with their business operations.
We call this "silent switching"— where customers maintain minimal deposit relationships while shifting transaction volumes and operational accounts to integrated fintech platforms.
The central insight? Your commercial customers no longer view banking as a destination but as a component within their business operating systems. This shift fundamentally changes how they evaluate banking relationships— increasingly prioritizing operational efficiency over traditional relationship banking models.
In this executive briefing, we share:
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Specific examples of mid-sized businesses maintaining minimum balances at their bank while running thousands monthly through alternative providers
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The organizational implications for credit-centric banks and why some institutions are successfully shifting to Treasury-led commercial acquisition
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A practical framework for evaluating the emerging threats and opportunities that address the unique workflows of high-value segments
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Actionable strategies to transform your digital offering from a standalone experience to an embedded component within your customers' daily operations
This isn't simply about technology— it's about fundamentally reimagining how your bank creates and delivers value to commercial clients in an ecosystem where banking is becoming an ingredient, not the meal itself.
A New Playbook for the Next Era of Banking
Executive Briefing - 4Q24
The banking industry is navigating a rapidly evolving landscape, where gaining a clear, comprehensive view of the forces shaping the future has never been more critical for senior leaders.
Our Executive Briefings provide an authoritative, 360-degree perspective on the key trends, innovations, and strategic imperatives defining success over the next 12-24 months.
Drawing on proprietary data and insights from the Alloy Labs ecosystem of leading banks, partners, and portfolio companies, this briefing offers a uniquely valuable window into banking's next horizon.
Key highlights include:
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The acceleration of embedded finance and banking-as-a-service models, enabling banks to deliver new non-rate customer value propositions through strategic partnerships
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The rise of digital-first banking experiences and the new competitive landscape, as banks face an exponential increase in competition from both traditional and asymmetric players
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Emerging technologies and their industry-shifting applications for enhancing operational efficiency, driving product differentiation, and improving customer experiences
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Evolving customer demands around personalization, convenience and trust, amidst increasing regulatory complexity and the need to update legacy playbooks
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The imperative for banks to embrace VUCA (volatility, uncertainty, complexity, ambiguity) as the new normal, requiring greater speed, agility and a willingness to test and learn
For senior executives, these briefings represent an essential resource for staying ahead of the curve, identifying high-potential opportunities, and positioning your institution as an industry leader.
We welcome any questions and look forward to discussing the insights in greater detail with your team.
