By Ivan Maryasin, General Manager at OakNorth

Digital technology has transformed almost every aspect of business banking. Opening an account, making payments, reconciling transactions and accessing financial information are all faster and more intuitive than they were even a few years ago. Artificial intelligence is now beginning to automate everything from customer service to financial reporting, promising even greater efficiency for businesses.

For growing companies, these developments are overwhelmingly positive. Yet as the industry becomes increasingly focused on digitisation, there is a danger that we begin to equate better technology with better banking. For businesses navigating periods of rapid growth or change, that simply is not the case.

Digital is just the baseline

Not long ago, a seamless digital experience was a genuine competitive advantage. Today, it is table stakes. Fast onboarding, intuitive platforms, real-time payments and instant access to financial information have become the minimum standard rather than points of differentiation. Banks that fail to deliver these capabilities will quickly fall behind.

Digital-first providers have fundamentally changed customer expectations, prompting established banks to rethink how they serve SMEs and lower mid-market businesses. Crucially, however, research suggests the next phase of competition will not be won through technology alone, but by institutions that combine excellent digital experiences with trusted human expertise[1].

Technology is no longer what differentiates a bank – it is just the price of admission.

Where automation reaches its limits

Technology excels at handling repeatable, rules-based tasks. Payments, reconciliations, approvals and reporting can all be completed faster, more accurately and more efficiently through automation than through manual processes.

The challenge is that growing businesses are rarely straightforward. Growth creates complexity. A company acquires a competitor. It expands overseas. New investors join the table. Treasury becomes more sophisticated. Funding structures evolve. Increasingly, decisions require context rather than process.

At OakNorth, we have spent the past decade working alongside ambitious lower mid-market businesses as they navigate precisely these moments. No two growth stories are the same. One customer may be integrating an acquisition, another expanding into a new international market, while another is investing heavily to increase production capacity. Their circumstances are different, but one thing remains consistent: as businesses grow, their banking needs become more nuanced. That is where technology alone reaches its limits, and where experienced relationship managers can add real value.

One of AI’s greatest strengths is recognising patterns. Growth businesses, by contrast, tend to achieve their growth by creating exceptions. Research commissioned by the UK Government into SME technology adoption found that while businesses continue to embrace digital tools, they consistently value personalised, expert support when making more complex operational and financial decisions[2].

Judgement, and people, are becoming the differentiator

One consequence of the industry’s digital transformation is that many businesses now feel further removed from their banking provider than they did previously.

For routine transactions, that distance rarely matters. But when a business is preparing for an acquisition, restructuring its finances, entering new markets or responding to changing economic conditions, the conversation is no longer about processing transactions. Instead, it is about understanding the commercial context behind the decision.

Recent research suggests many businesses believe this element of banking has weakened. A survey of more than 2,000 UK SMEs found that while overall satisfaction with banking services remains high, around half were dissatisfied with the level of proactive advice they received from their primary banking provider[3].

High-tech yet high-touch

The future of business banking will be defined, not by a choice between technology and people, but by how effectively the two work together.

Paradoxically, as technology becomes more capable and more accessible, human judgement becomes more valuable. The more sophisticated a business becomes, the less likely its challenges are to fit neatly into a standardised process. Experience, perspective and commercial understanding become increasingly important because every growth journey has its own pitfalls.

Digital capability may now be the baseline, but judgement is becoming the true differentiator. The banks that stand out over the next decade will be those that understand when technology is enough, and when a growing business needs the insight, perspective and partnership that only experienced people can provide.

[1] https://thedigitalbanker.com/we-are-seeing-a-strong-momentum-in-sme-banking-bain-companys-manfredi-demozzi/

[2] https://www.gov.uk/government/publications/understanding-technology-adoption-among-uk-smes?utm_source=chatgpt.com

[3] https://rfi.global/press-release-fintechs-gain-ground-as-uk-smes-rethink-banking-relationships/