Catering to the $300 billion SMB industry with American Express Business Blueprint

SMBs are both a land of opportunity and a challenge for traditional FIs and service providers. On the one hand, there is the promise of a $300 billion industry that is looking for financial management solutions. On the other hand, developing such solutions for businesses across multiple verticals means that traditional “one-size-fits-all” approaches cannot cater to their needs, nor are they big enough to generate large revenue streams for specially developed products.

Despite this double-edged sword, the last couple of years have seen an increasing push towards product offerings for SMBs, and incumbent players have taken note. Joining this wave with yet another product is American Express, with its recent launch of American Express Business Blueprint – a new digital cash flow management hub built exclusively for SMBs. 

This hub comes on the heels of Amex’s acquisition of Kabbage, a fintech company that built cash flow solutions for SMBs and quickly grew amongst its previously underserved user base. For Amex, the plan has been to create products that combine checking accounts with card products as well as the company’s lending solutions in a one-stop shop solution for SMBs.

In this deal, Amex gained access to Kabbage’s employees, financial data and technology, but not its preexisting loan portfolio. The Business Blueprint platform builds on top of this acquisition, as both companies have fully integrated their technology and infrastructure. 

“I think if you ask a small business owner, they'll be very familiar with our card products. And that's a very important piece of the puzzle. But really, we are trying to serve a much broader set of small business owner needs and it really is about their overall cash flow visibility,” said Brett Sussman, VP of Marketing and Sales at Kabbage last year.

According to Sussman, one of the major reasons SMBs switched their primary FIs in the past few years was the need to have numerous services bundled into one place and necessary interoperability between those services. Amex caught onto this early and has been working to offer the right mix of solutions to SMB customers.  

For example, with American Express Business Blueprint, SMBs can now create virtual cards offered by Amex through its partnership with Extend, but also have visibility into their cash flow. Earlier, the company partnered with Airbase, a spend management platform that helps SMBs streamline all non-payroll expenditure. This move was in line with Amex’s larger strategy around building cash management solutions for SMBs by acquiring or partnering up with quickly growing players in the market. 

Gina Taylor, EVP & GM, Business Blueprint & Banking adds that the product is the culmination of 2 years of efforts spent integrating fintech with Amex.

So, what does American Express Business Blueprint have to offer SMBs?

My Insights: A free cash flow analytics solution that helps SMB owners have visibility into their Amex Business cards as well as their linked external accounts. Here SMBs can peer into their expense trends, have access to years of historical transactional data, view 30-day cash-balance projections, as well as have expense alerts.

Eligibility for Parallel Amex: If eligible, SMBs can gain access to capital and checking accounts, as well as accept payments through American Express Business Line of Credit, American Express Business Checking, and American Express Payment Accept.

SMB-focused UX: “We want the American Express Business Blueprint to be the daily homepage for our customers. To do that, Business Blueprint aggregates the data from a customer’s American Express Business products, plus they may connect their third-party business accounts — including other cards or bank accounts. This allows customers to get a thorough picture of their cash flow all in one place, without having to log in to disconnected products or platforms to try and analyze their data on their own,” added Taylor.

Like Business Blueprint, Amex has been consistently pushing towards other solutions for its SMB ecosystem. Last year, the company rolled out Business Link, which allows B2B suppliers to accept card and non-card payments from buyers locally and internationally. Similarly, Global Pay rolled out last year and gave SMBs the ability to send cross-border B2B payments to their suppliers globally. 

Unlike its competitors, Amex operates in a closed loop as an issuing bank as well as a card network. This gives Amex a whole system view of how and where consumers spend, allowing it to create customized rewards. Amex explains its Closed Loop Network to merchants in the following way on its website: 

“By knowing our cardmembers and their spending habits with you and your competitors, we can provide you insights to help you understand and target your customers better.”

This is the exact proposition Amex wants to bring to the middle market – creating a “full system view” of SMB payments and cash flow.

With others also eyeing the SMB space, Amex is confident in its 172-year legacy, and its ability to outlast and outrun its competition, says Taylor. For the future, the company is hoping to branch out from cash flow management and offer products for SMB management in general. Similarly, as the sector continues to grow, the company is thinking of adding faster payment settlements and deposits to its portfolio – making sure that SMBs have access to the same quality of products that large businesses have historically had access to.