At the start of the year, Bank Innovation predicted, “if 2019 was the year of the challenger bank, 2020 will be the year payments companies move closer to bank territory.”

But as 2020 would have it, not much is what it seemed at the beginning of the year, with the coronavirus pandemic disrupting the fintech and innovation space. And it seems the focus from all directions has shunted toward SMBs, with big banks, fintechs and lenders all racing to better serve — and accelerate the recovery of — one of the hardest hit segments of the economy.

The SMB banking space is poised to experience a lift, with fintech lenders Kabbage and BlueVine wading closer to full-service banking territory and big banks, including TD Bank and Wells Fargo, looking to curb the competition by prioritizing digital tools for SMBs aimed at mobile banking and e-commerce. Meanwhile, e-commerce marketplaces Alibaba and Shopify debuted financing solutions and business checking accounts.

However, the recent influx to the SMB market has created a crowded marketplace, and as SMB banking needs become more complex, there will likely be a fallout of newer players, according to Christine Barry, research director of Aite Group’s wholesale banking practice.

“What we’re finding is that small businesses are becoming increasingly sophisticated in their needs, and they’re starting to look a little more like traditional commercial customers,” Barry said. “Once they do that, it’ll become very difficult for a less experienced player in the space to really be able to keep up with the complexity of the product,” compared with the incumbent banks who already have commercial-type products built out, she said.

TD Bank, for one, signaled a renewed focus on SMB customers with the creation of a new role dedicated to commercial products and payments. Jo Jagadish, who is filling that role at $355 billion dollar TD, recently told Bank Innovation that she will prioritize SMB online tools after finalizing a digital platform to support the forgiveness process for the Paycheck Protection Program.

Wells Fargo, too, has put dollars and hours into the small business segment, most recently lining up an e-commerce gateway product that will allow merchants to accept foreign currencies and transact around the globe.

Between March and July, Wells Fargo also issued Clover Go devices so that business customers could accept mobile payments and pivot their business operations to maintain their revenue streams during the pandemic. The $1.9 trillion dollar bank provided the devices during that this time frame for free and is also waiving the monthly fees, which range from $69 to $280, for the first six months, according to Colleen Taylor, head of merchant services at the bank.

Even with the recent push from big banks, alternative fintech lenders are not stepping back from the SMB opportunity.

Kabbage last month debuted Kabbage Checking, designed to work together with its other banking products, which also include a business insights tool, a payments product and Kabbage’s own lending product. The checking account product marks the company’s first partnership with Green Dot Bank, which will insure the checking accounts. Kabbage has raised $2.5 billion to date, according to Crunchbase, and was the third-largest PPP lender in the country by application volume with 209,000 approved customers, behind Bank of America and JPMorgan Chase.

Kabbage President Kathryn Petralia called the checking account the “glue that holds all those services together.” And that strategy should bode well for Kabbage, according to Aite’s Barry, who said launching checking accounts is especially relevant for lenders.

“If you think about where most bank relationships start at the credit product, and from there they cross-sell checking or some of the other banking products,” Barry said. “So they have a very captive audience so it only makes sense if they’re able to cross-sell checking or deposit products.”

Although Kabbage declined to say how many customers have signed up for the account, Petralia said it will lean into the fintech’s 200,000-plus new PPP customers. Already, the company has teed up mobile check deposit features and mobile wire transfers for the new account, slated for a yearend release.

BlueVine, which serves more than 125,000 small business owners, has also refined its checking account product, which launched last October. The Redwood, Calif.-based company enhanced its onboarding flow, streamlining some steps in the process and honing KYB questions, said Chief Product Officer Herman Man. This year, BlueVine also added the capability to manage debit cards within the mobile app.

BlueVine, which has delivered more than $6.5 billion in funds to SMBs, is also working to integrate with third-party accounting software to pull in information and has payment products in the works, noting there’s an opportunity to provide lift to SMB accountants and bookkeepers. BlueVine has raised $692.5 million to date, according to Crunchbase.

While larger players in the SMB banking space may have a leg up in terms of resources and experience to provide more complex banking products, the fintechs are bullish that the strategy of serving one segment and one segment only will help edge out the competition.

“We aren’t looking to go downstream or be a consumer bank, we’re not looking to be an enterprise commercial bank. We are targeted to the 30 million small businesses and they’ve never seen that before, not at Chase, not at Citi, not at Wells,” Herman Man said. “As long as we hold true to that point and we continue to build for them, push the envelope and solve their workflows through the innovation, we’re good there.”