• Challenger bank NorthOne announced a partnership with The Bancorp Bank to launch real-time payments via The Clearing House’s network.
• NorthOne customers initially will be able to receive real-time payments. The ability to send real-time payments will come with “future updates” the company said.
• With offices in New York and Toronto, NorthOne has raised more than $90 million in funding for its deposit account that helps small businesses and freelancers better manage their finances.

U.S.-based challenger bank NorthOne has teamed up with The Bancorp Bank to launch real-time payments via The Clearing House’s Real-Time Payments network.

NorthOne co-founder and CEO Eytan Bensoussan called the new offering a “huge milestone” for both his company as well as for the fintech industry writ large. Bensoussan also underscored the value of real-time payments to NorthOne’s small business customers. “For small business owners, cash flow and liquidity are paramount,” he said. “By removing payment waiting times, we’re able to free up a frustrating technical bottleneck for our customers, making it easier for them to operate their business efficiently.”

Founded in 2016, NorthOne specializes in helping small business owners, startups, and freelancers better manage their finances. The company offers a deposit account that enables users to view full account histories and manage receipts, and provides automatic categorization of purchases. Users can connect their NorthOne accounts to their POS or payment processor to get paid faster, as well as leverage the account to pay invoices, manage payroll, and send ACH or wire payments.

With offices in New York and Toronto, Canada, NorthOne sees the introduction of real-time payments as a way to help the 61% of small businesses that it says are struggling because of poor cash management. The update announced this week will enable NorthOne customers to receive instant payments. The ability to send real-time payments will come as part of a separate, future update.

This week’s product launch is the latest news from NorthOne, which most recently made fintech headlines with a $67 million fundraising in October. The Series B investment featured participation from both new and existing investors, and brought the company’s total equity capital to more than $90 million.

“50% of small businesses in America fail over a five-year time horizon,” NorthOne co-founder and COO Justin Adler said when the company’s latest fundraising was announced last fall. “And the majority of those failures are due to financial mismanagement and a lack of financial systems and controls. Our team is proud to be able to de-risk entrepreneurship and make starting and running a successful small business accessible to anyone.”

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• Allianz Trade, Santander Corporate & Investment Banking (Santander CIB), and Two have partnered to launch a new B2B buy now, pay later (BNPL) tool.
• The new tool leverages Allianz Trade to protect against the risk of default, Santander CIB for financing, and Two for the BNPL technology.
• The launch comes one year after Santander’s digital consumer bank launched Zinia, a customer-facing BNPL solution.

A new three-way partnership is driving fresh innovation in the BNPL space this week. Trade credit insurance firm Allianz Trade, trade finance bank Santander Corporate & Investment Banking (Santander CIB), and B2B ecommerce payments platform Two have teamed up to create a BNPL tool for large multinational corporations.

Combining each firms’ expertise, the group has created a solution for corporations to offer a buy now, pay later (BNPL) tool for business buyers, enabling them to defer payments at checkout. Created by Two, the BNPL tool supports payments in multiple currencies and leverages Santander CIB for financing to offer sellers payment upfront while facilitating credit terms to buyers.

Allianz Trade protects against the risk of default. The firm will leverage its database that contains information on more than 80 million corporations to instantly assess credit requests via its API, helping Santander CIB make financing decisions instantly. 

“Our solution will be distributed worldwide and aims to allow large corporates to develop their online sales by offering deferred payments to existing and new customers, without being exposed to non-payment risks, while benefiting from immediate and guaranteed payments,” said Allianz Trade Global Head of e-commerce François Burtin. “It is a turnkey solution combining the very best of our three firms, easy to set up and improving both seller revenue and user experience.”

Today’s launch comes one year after Santander’s digital consumer bank launched Zinia, a customer-facing BNPL solution for customers in Germany and the Netherlands.

Founded in 2020, Two seeks to fix the world of B2B ecommerce by offering a corporate BNPL tool. The Norway-based company has raised $3 million in seed funding. “At Two we are obsessed about delivering seamless ordering and buying for B2B buyers while removing and automating the operational processes for sellers,” said Two Cofounder Stavros Tamvakakis. “Business buying is not a one-size fits all and our product streamlines key steps in the journey (e.g. instant onboarding, ordering, underwriting, invoice distribution, payments, reconciliation) so that sellers do what they do best while we abstract the pain points of drop-offs, working capital tie up, risk, and manual work. Our ambitions are at a global scale, so we decided to take our partnership with Allianz Trade further by collaborating with Santander CIB, combining two powerhouses in insurance and banking to create a unique and innovative solution dedicated to large corporates.”

As the demand for direct-to-consumer BNPL tools increases, so will the demand for B2B BNPL tools. Other players in the B2B BNPL arena include Bespoke Financial, TreviPay, and Tranch. These tools rely on business credit and repayment data to mitigate risk, so partnerships with firms like Allianz Trade will prove to be essential in helping B2B BNPL newcomers ensure repayment.

Photo by Pixabay

• Digital banking app for kids and teens, Greenlight, launched a financial literacy game today.
• The game, Greenlight Level Up, is designed to teach financial skills to kids from kindergarten to 12^th grade.
• Only 23 states in the U.S. require schools to offer lessons in personal finance.

Greenlight, a digital banking app for kids and teens, unveiled a financial literacy game today called Greenlight Level Up.

The game aims to teach kids from kindergarten to 12th grade skills that they can use to improve their financial well-being. Many financial skills are not taught in schools. In fact, only 23 U.S. states require schools to teach a personal finance course. Greenlight Level Up offers lessons on earning, spending, saving, investing, managing credit, income, taxes, and more.

The game was crafted by academic and game design experts to keep kids engaged, using coins and stars as rewards.

Schools, teachers, and students can access Greenlight Level Up for free via Greenlight for Classrooms, an online financial literacy library for kids in grades kindergarten through 12. Greenlight for Classrooms will launch later this year.

Greenlight was founded in 2014 and offers a money management platform for families. The company has served five million parents and kids, offering them real-life experience in the financial world with credit and debit cards, along with a tandem mobile app. By using the cards with help from their parents, Greenlight helps kids build skills to manage their earnings, savings, spending, and giving; and empowers kids to learn to invest. In 2021, Greenlight raised $260 million in a round that valued the company at $2.3 billion.

Photo by Jessica Lewis Creative

• Japanese buy now, pay later fintech Smartpay launched Smartpay Bank Direct, a tool that will enable users to pay for their purchases directly from their bank accounts.
• Prior to today’s launch, Smartpay users could only repay using a credit card.
• Smartpay is currently available in Japan, KSA, and the UAE. The company aims to expand into Singapore, South Korea, Taiwan, and other markets in Southeast Asia and MENA.

Japan-based Smartpay is launching Smartpay Bank Direct, a tool that offers users a new way to pay for their online installment purchases.

Starting today, Smartpay users can pay for their buy now, pay later (BNPL) purchases directly from their bank accounts. The move is made possible by Smartpay’s partnerships with 67 banks and makes Smartpay one of the first consumer finance companies to leverage Japan’s open banking ecosystem.

Smartpay markets itself as a “payments experience” company, offering consumers a BNPL tool that enables consumers to pay for their purchases in three installments over the course of two months with no fees or interest. When the company launched its BNPL tool, consumers could only repay using their credit card. Today’s launch empowers them to pay directly from their bank account.

Japan revised its open banking approach in June 2018, when it required banks to offer open APIs within two years. After the start of 2020, the deadline was extended to September 2020. By that time, 97% of banks were in compliance.

“Since the launch of Smartpay just over a year ago, as Japan’s first BNPL solution payable by credit card, we have continued to expand our partner ecosystem with new retailers and an expanding customer base with revenue growth over 200% in the last three months,” said Smartpay founder and CEO Sam Ahmed. “It’s interesting that we have lifted merchant average order value more than 30% in four different merchant categories. We attract higher value consumers for the merchant through our eKYC process.”

Smartpay was founded in 2021 and is currently focused on Japan, KSA, and UAE markets. The company aims to expand into Singapore, South Korea, Taiwan, and other markets in Southeast Asia and MENA “in the medium term.”

Photo by Isaque Pereira

• U.S.-based banking association and payments network operator The Clearing House appointed a new CEO this week.
• David Watson will assume the leadership position from Jim Aramanda, who will retire at the end of this month.
• Watson comes to The Clearing House from SWIFT, where he served as Chief Product Officer.

The Clearing House (TCH) is getting a new leader for the new year. The U.S.-based banking association and payments network operator appointed David Watson as its newest CEO, launching into 2023 with a fresh start.

Watson will take the reins from the company’s current President and CEO Jim Aramanda, who will retire at the end of this month. Aramanda has served as CEO of TCH for 15 years, beginning his tenure at the height of the financial crisis in 2008.

“The Clearing House’s Supervisory Board is grateful for Jim Aramanda’s long-standing service to the organization, said Bank of America Chair and Chief Executive Officer and Chair of the TCH Supervisory Board Brian Moynihan. “During Jim’s tenure, TCH continued its critical role in delivering ultra-reliable payments capabilities to the U.S. financial system, but importantly, also introduced innovative new payments capabilities. This includes the RTP network, which is now delivering real-time payments capabilities.”

Watson comes to TCH from SWIFT, where he served as Chief Product Officer, assisting in product engineering, development, and innovation. Prior to that, he served in multiple roles at Deutsche Bank for 17 years. His titles included Head of Cash Management Americas and Global Head of Digital Products, Global Head of Product Development – Global Transaction Banking, and Head of Americas Product Management – Global Transaction Banking.

“David brings extensive payments experience, in-depth expertise in the field, and a strong track record of innovation,” said Moynihan. “David will continue TCH’s important work of driving adoption of real-time payments capabilities and focusing on the safety, security, reliability, and efficiency of bank-owned payment systems which are critical to the financial system.”

TCH was founded in 1853. The 170-year-old company is owned by 24 of the largest commercial banks in the U.S. and clears and settles approximately $2 trillion in bank-to-bank payments each day through wire, ACH, check image, and real-time payments. In 2017, TCH took the historically slow U.S. payments industry into the next level by launching the Real Time Payments (RTP) network, which helps clear and settle payments instantly and facilitates the real-time exchange of payments-related data.

Shortly after David Watson becomes TCH’s new CEO, the company’s RTP will gain a new rival. RTP will compete directly with FedNow, the U.S. Federal Reserve’s real-time payment system, after it launches in July of this year. FedNow creates a new rail for payments that will provide all financial institutions access to secure, instant payment services in real time.

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• St. Mary’s Bank, a credit union headquartered in New Hampshire, has teamed up with credit risk specialist AKUVO.
• The nation’s first credit union, founded in 1908, St. Mary’s Bank will deploy AKUVO’s Aperture to automate and enhance its collection operations.
• With $1.5 billion in assets, St. Mary’s Bank said goodbye to its eighth CEO in December, as CEO and President Ronald Covey announced his retirement after 14 years leading the firm.

New Hampshire-based St. Mary’s Bank has teamed up with AKUVO, a credit risk specialist headquartered in Pennsylvania. St. Mary’s Bank will deploy AKUVO’s Aperture platform to streamline and enhance its collections operations, including bankruptcy, repossession, and foreclosure.

“We are committed to providing state-of-the-art banking services,” St. Mary’s Bank EVP and Chief Lending Officer Jan Raymond said. “With the amount of automation and integration we plan to leverage in Aperture, our team will have more time and the right tools to offer a first-class member experience while also managing risk and lowering delinquency.”

AKUVO’s Aperture platform helps banks and credit unions move away from the traditionally reactive, tactical approach to managing collections. Instead of static workflows, inefficient workspaces, and little customer personalization, AKUVO’s Aperture leverages analytics and automation to give financial institutions a streamlined, cloud-based solution. Not only does Aperture make day-to-day operational tasks easier, the technology also predicts behavior and provides insights to help head off delinquencies before they occur. Aperture helps banks and credit unions manage a wide range of collection and loss mitigation operations ranging from credit disputes and debt settlement to bankruptcy, foreclosure, and repossession.

“I think all service providers feel a tremendous sense of pride when they are chosen by the nation’s first credit union, and that is certainly the case at AKUVO,” AKUVO Chief Revenue and Operating Officer Steve Castagna said. “We look forward to assisting St. Mary’s in leading the credit union movement with its superior service and commitment to innovation.”

With $1.5 billion in assets, St. Mary’s Bank has the distinction of being the nation’s first credit union. Founded in 1908 and headquartered in Manchester, New Hampshire, St. Mary’s Bank is a not-for-profit, member-owned institution that offers financial products and services to both consumers and businesses. St. Mary’s Bank has eleven branch locations in Manchester, Hudson, Londonderry, Milford, Nashua, and Portsmouth, and supports a mortgage center in Concord.

St. Mary’s Bank ended 2022 with an announcement that Ronald Covey, who had served as the credit union’s president and CEO for 14 years, was retiring. Under Covey’s tenure, St. Mary’s Bank grew in membership from 60,000 to 98,000 members. Assets grew from $652 million to nearly $1.5 billion. Covey was also credited for helping the institution adapt to the “rapid technological advances in the financial services industry,” according to St. Mary’s Bank board of directors chair Steve Grzywacz.

Founded in 2020 by CEO Jay Mossman, AKUVO finished last year with a series of new partnerships. These include new pacts with Florida-based credit union FAIRWINDS and Michigan-based Financial Plus Credit Union in December; Mountain America Credit Union in November, and both CapEd Credit Union and Tucson Federal Credit Union in October. The company has raised $1.7 million in funding and announced a pair of debt financing rounds in February and May of 2022.

Photo by Scott Webb