EXTON, Penn. — Small businesses are increasingly looking for financial institutions that combine advanced digital treasury tools with personalized service, creating an opportunity for credit unions to expand their commercial banking businesses, according to one credit union executive.
Thomas Sebok, chief commercial banking officer at Citadel Credit Union, told PYMNTS Intelligence that many business owners still associate credit unions primarily with consumer accounts, despite many institutions now offering sophisticated commercial banking services.
“There’s a stereotype when the words ‘credit union’ comes out, where people think about little league accounts, Boy Scout accounts, PTA type accounts,” Sebok said. “But what you’ll find here are embedded service providers, professional services and businesses like restauranteurs or local franchisees that make up the fabric of the communities where we live.”
Where Larger Institutions Struggle
Sebok, who joined Citadel after more than 20 years in commercial banking at larger financial institutions, said national banks continue to serve small businesses effectively but often struggle to maintain the close customer relationships many entrepreneurs value.
“Big banks do get small businesses in a resounding way,” Sebok told PYMNTS Intelligence. “The challenge for big banks is: How do you meet the needs of a small business owner when you have so many different customers.”
According to the report, business owners are increasingly seeking more than competitive loan rates, expecting services such as treasury management, payroll processing, ACH and wire payment capabilities, remote deposit capture and integrated fraud protection.
Sebok said those expectations reflect a broader digital transformation in commercial banking.
A ‘Pivotal Time’
“We’re at a pivotal time in the history of commercial and small business relationships,” he said. “It is a digital evolution.”
He added that fraud prevention has become one of the industry’s most pressing challenges as businesses face growing threats across both electronic and check payment channels.
“One of the most critical things that are facing our industry as a whole is the paralyzing volume of fraud, whether it be in the electronic or check-related format,” Sebok said.
How CUs Has Responded
According to PYMNTS Intelligence, Citadel Credit Union has responded by expanding its commercial banking capabilities beyond lending to include treasury management and other business services. The credit union reported commercial loans totaling $449 million, a 17% increase from a year earlier, according to company figures cited in the interview.
Sebok said the credit union’s strategy combines community-based relationship banking with technology, including artificial intelligence-assisted credit processes, predictive analytics and around-the-clock digital access.
“We’re not your grandparents’ credit union,” he told PYMNTS Intelligence.
