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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Citizens Bank of Edmond has a single branch located in Oklahoma– what many people consider a “fly over state.” The town of Edmond, where the building is located, boasts a population of just under 100,000 people. That’s not stopping President and CEO Jill Castilla from pursuing growth, however.
Castilla announced today that her bank– with $400 million under management and just 55 employees– is taking Citizens Bank of Edmond national. Now, U.S. citizens across the country can sign up for a retail bank account at Citizens Bank of Edmond. The move broadens the bank’s reach to around 300 million people.
“In an unprecedented 72 day timeline to implementation, Citizens proves that small banks can be nimble, fast, thorough, sophisticated and still deliver a George Bailey-like experience,” said Castilla in an announcement on LinkedIn. “We love leading the way for other community banks to stay relevant for decades to come!”
Powering the launch is digital banking technology company Narmi. Founded in 2016 by former bankers Nikhil Lakhanpal and Chris Griffin, Narmi has a mission to offer financial institutions the best digital banking platform in the industry. The New York-based company offers both retail and commercial accounts, as well as a digital account opening solution that takes only two minutes and 13 seconds to complete.
Narmi, which has amassed $55 million in funding, counts Radius Bank (now Lending Club), Greater Alliance Federal Credit Union, Berkshire Bank, Freedom Credit Union, and more among its clients.
By opening its digital doors to everyone in the U.S., Citizens Bank of Edmond is breaking down geographical barriers. This shift toward “affinity banking” or “identity-based banking” will enable Citizens Bank of Edmond to take advantage of the brand identity and recognition it has spent the past few years building.
During the pandemic, the bank leaned hard into its focus on community and the small businesses that make up the community. For example, Castilla frequently shared her phone number on public channels as a resource for those in need. She also contacted all of the bank’s business customers to determine their main areas of stress. And when the bank had to close its lobby, its employees met customers at the curb to schedule time slots to serve its customers and maintain a personal touch.
It will be interesting to see how Citizens Bank of Edmond plans to maintain that level of personal touch while scaling up its accounts. Given Castilla’s fastidious determination, however, I do not envision the bank will have an issue maintaining its reputation of offering a top-notch customer experience. To hear Castilla talk about customer experience in person, come to FinovateFall next month and check out her panel.
PayPal launched its new stablecoin, PayPal USD (PYUSD) today.
PayPal USD is backed by U.S. dollar deposits, short-term U.S. treasuries, and cash equivalents. The coin is redeemable 1:1 for U.S. dollars.
The new offering is designed for digital payments and Web3 and will be available on Venmo “soon.”
Fully backed by U.S. dollar deposits, short-term U.S. treasuries, and cash equivalents, PayPal’s new stablecoin, PayPal USDis now live. The stablecoin – PYUSD – is designed for digital payments, and is compatible with most digital asset exchanges, wallets, and Web3 apps. Eligible U.S. PayPal customers who buy the coin will be able to transfer it to external wallets, send it via P2P payments, and use it to fund purchases at PayPal-supported checkouts. PYUSD holders will also be able to convert their cryptocurrencies into and from PYUSD, which is redeemable 1:1 for U.S. dollars.
PayPal president and CEO Dan Schulman said that the successful adoption of crypto will need stablecoins like PYUSD. “The shift toward digital currencies requires a stable instrument that is both digitally native and easily connected to fiat currency like the U.S. dollar,” Schulman explained. Moreover, Schulman noted that PayPal – with its “commitment to responsible innovation and compliance” – and powerful brand – is in an ideal position to play this role via its PayPal USD offering. He added that PYUSD will be compatible with Web3 apps from the start and will soon be available on Venmo, as well.
PayPal USD is an ERC-20 token issued on the Ethereum blockchain. The stablecoin is managed by Paxos Trust Company. Paxos has indicated that it will publish a monthly Reserve Report for PYUSD outlining the instruments composing the coin’s reserves. The first such report is expected in September.
PayPal has been a Finovate alum since 2011. In the years since, the fintech has grown into a payments leader with more than 435 million active consumer and merchant accounts, and nearly 30,000 employees. The company has facilitated more than 22 billion payment transactions, representing a total payment volume of $1.36 trillion. Founded in 1998 (as Confinity), eBay acquired the company in 2002 for $1.5 billion. eBay spun off PayPal to its shareholders in 2015, returning the firm to its independent status.
PayPal is a public company, trading under the ticker symbol PYPL on the NASDAQ exchange. The San Jose, California-based fintech has a market cap of $71 billion.
Knot has raised $10 million for its tool that updates consumers’ card-on-file at the company’s network of merchants.
The round was led by Nava Ventures and brings Knot’s total funding to $13 million.
Knot also offers a subscription cancelling solution and is currently working on a password updating tool.
With a mission to build an interconnected future online, Knot API has a long road ahead. Nevertheless, the New York-based company received a boost to help it make strides toward that goal with a new $10 million funding round today.
The Series A investment was led by Nava Ventures, with participation from Amex Ventures, Plaid, and more than 20 CEOs and founders. When added to the $3 million Seed round Knot received in 2021, today’s round brings the company’s total funding to $13 million.
Knot was founded in 2019 with an API to enable card issuers to update card-on-file information at Knot’s network of merchants– including Walmart, Netflix, Amazon, Starbucks, and Uber– with just a few lines of code. The company’s technology makes for an easier onboarding experience for consumers while helping the bank retain its customers.
Knot will use the $10 million to scale its services and expand its merchant support. The company’s goal is to “ultimately encompass virtually all online merchants.”
In addition to its card-on-file switching solution, Knot also offers a subscription cancelling tool that helps customers view and cancel their recurring subscriptions. The company is also working on an account creation tool that allows organizations to initiate accounts at third parties on their customers’ behalf, and a password updater that instantly updates customers’ passwords across the web.
“Securing this Series A funding signifies the immense trust our investors have in Knot’s potential to revolutionize the way card issuers manage their customers’ payment methods,” said Knot CEO Rory O’Reilly. “We’re grateful for the chance to further our mission of building a financially interconnected future, and we’re excited about the new opportunities this funding opens up for our team and our customers.”
Formerly known as TeamApt, Moniepoint is the largest business payments platform in Nigeria. The company processes $170 billion in annualized total payments volume (TPV), and became QED Investors’ first investment in Africa last year.
Headquartered in London, with offices in Nairobi and Lagos, as well as the U.S., Moniepoint was founded in 2015. The company counts more than 600,000 businesses large and small among its customers. Moniepoint has been recognized by the Central Bank of Nigeria as the most inclusive payment platform in the country, and was named the second-fastest growing company in Africa by the Financial Times.
We caught up with Tosin Eniolorunda (pictured), founder and CEO of Moniepoint, to discuss the state of fintech in Nigeria and what Moniepoint is doing to help provide better financial services to businesses and communities in Africa.
In our extended conversation, we discuss challenges to digital transformation in the region, the evolution of Nigeria’s cashless economy, and what to expect in the wake of Moniepoint’s recent rebranding.
What problem does Moniepoint solve and who does it solve it for?
Tosin Eniolorunda: Moniepoint solves the problem of fragmented, inaccessible, and low-quality financial services for businesses in emerging markets. It is a full-service business banking platform seeking to provide all the digital financial services a typical business needs.
Moniepoint specifically provides businesses in emerging markets with banking, payments, credit, and business management tools to help them grow. Our motivation is to power business dreams and create financial happiness for our customers. We recognize the importance of businesses in driving economic growth. By powering the profitability and operations of these businesses, we hope to enable them to make significant contributions to the economy at large.
To date, we have powered the dreams of over one million businesses who support local communities up and down Africa.
Your company began the year with a rebrand, transitioning from Team Apt to Moniepoint. What was the significance of this decision?
Eniolorunda: The company, TeamApt, started as a service provider, and our name was aptly selected. The team providing these services was the heart of our solution. As the company grew, our flagship product – Moniepoint – became ubiquitous in the market, and it became necessary to bring everything together to push the whole brand forward. We had become the point for people’s money, and it was only right we took up that name.
We know top talent is highly sought after in the global fintech industry, which is why we wanted to show our commitment to embracing the best and brightest by going out into the world in our choice of headquarters. By being more globally oriented, we want to be recognizable as an employer of choice for talents around the world.
What is the financial services industry like in Nigeria? And what is its relationship with the fintech ecosystem?
Eniolorunda: The financial services industry in Nigeria is generally a collaborative one. The Central Bank of Nigeria drives policy change in collaboration with all players in the industry – traditional banks and fintech players – all geared towards a more financially inclusive ecosystem. An example of how this plays out is fintechs working with traditional banks as their settlement partners, and traditional banks providing virtual account solutions to fintechs so they can, in turn, provide digital wallets to their customers.
It’s also recognized that fintechs take a generally technology-first approach to financial solutions, and regulations exist to make this as seamless as possible.
You have said that “low-trust” is an impediment to digital transformation in Africa. Can you elaborate on this challenge and what is necessary to overcome it?
Eniolorunda: Financial education is particularly important to gain trust and support for digital transformation, as people generally are wary of what they do not understand. In societies with a large percentage of uneducated people, it is expected that they will push back on innovation that promises to make their lives better.
For example, if a digital bank wants to provide nimble convenient services, it might decide not to have physical branches or a call centre to manage costs. However, low-trust means that these communities of people want to see a person or hear from them in order to leave their monies in the bank.
We overcame this barrier by approaching these markets using a hybrid distribution method – via collaboration with local people they could identify. When they got introduced to these digital solutions by people they knew and saw in their neighborhoods, it became easier for them to trust these products and try them out.
This spring there were a number of headlines about the “cash crisis” in Nigeria. Can you tell us about this and how the crisis impacted Moniepoint?
Eniolorunda: In March 2023, as part of its effort to aid in adopting cashless means of payments, combat inflation and prevent fraud, the Central Bank of Nigeria started a redesign of the Naira, Nigeria’s currency. People had to turn in their old notes as they were no longer legal tender, and the consequence of this process was a reduced availability of cash and, by extension, increased reliance on digital payments.
Moniepoint began to focus on supporting businesses in April 2022, extending our banking and payment tools to them. Consequently, during this cash crunch, we were well-placed to provide these businesses with the tools they needed to accept digital payments and stay afloat.
As a result, we saw a surge in transactions during this period. We adjusted our platform to make it more reliable, helping us to keep supporting these businesses.
What role will Moniepoint play in an increasingly cashless economy in Nigeria and other parts of Africa?
Eniolorunda: By being a banking partner for businesses, we enable them to receive payments digitally, which is very important in Africa’s journey towards becoming a cashless economy. In 2022, we helped businesses process over $170 billion, and are continuing this positive trend in 2023.
We are determined to stay at the forefront of the digital revolution. Initial efforts across the continent have been focused on providing individuals with access to digital financial services, giving them cards and other means to pay digitally. It’s not enough for customers to be empowered to pay digitally; the businesses have to be equipped with the education and resources to receive these payments.
When businesses are able to receive these digital payments directly, cash becomes less central to every transaction, and we’re collectively closer to a cashless ecosystem.
There has been talk in the fintech press about Moniepoint and potential acquisition opportunities. Is the company actively looking to make significant acquisitions?
Eniolorunda: Yes, the plan is to make significant and strategic acquisitions that align with our overall goal of providing an all-in-one financial platform for businesses in emerging markets. These acquisitions allow us to expand our product suite or enter new markets.
Also recently Moniepoint announced a partnership with Google Cloud. Why did Moniepoint pursue this partnership, and what will the partnership help Moniepoint accomplish?
Eniolorunda: As we grew bigger and faster, it was important that financial transactions on our platform could be performed at light speeds, so adopting a hybrid cloud strategy was key for us.
Some of the tools include Cloud Spanner and Kubernetes, which help us to manage and process high volumes of transactional requests per minute, with no lag time. A partnership with Google Cloud ensures we can use their services with personalized support that the scale of our business needs.
What can we expect from Moniepoint in the second half of 2023 and into next year?
Eniolorunda: We are proud to have already been be recognized this year as not just Africa’s largest fintech, but also its fastest-growing. But this is only the beginning.
We have so much in store for the second half of 2023, including plans for a new product and to enter new markets. Watch this space.
Trends in fintech move fast, and one way to stay ahead of each new advancement is to follow the minds of thought leaders in the space. That’s why, for FinovateFall 2023, we’ve gathered an insightful group of speakers to take the stage during the event, which takes place on September 11 through 13 in New York. Be sure to register soon; FinovateFall is typically our largest event.
The diverse group of speakers will offer presentations on a wide range of industry topics, including payments, decentralized finance, lending, open banking, AI, and more. FinovateFall will host almost 130 speakers. And because it’s difficult to feature them all in a single post, we’ve distilled the list to highlight a handful of fintech celebrities that will grace the stage.
Alexa Von Tobel, Co-Founder & Managing Partner at Inspired Capital
Alexa Von Tobel is the co-founder and managing partner of Inspired Capital. Prior to Inspired Capital, Alexa founded LearnVest in 2008 with the goal of helping people make progress on their money.
Matt Harris, Partner at Bain Capital Ventures
Matt Harris is a Partner at Bain Capital Ventures in New York City and focuses on investments in financial technology. He sees a huge amount of revenue, profit, and market cap shifting from regulated financial institutions to entrepreneur-led insurgents, across payments, lending, capital markets, real estate and insurance.
Jacqueline Baker, Author of The Unexpected Leader
Jacqueline M. Baker is a speaker, author, leadership consultant and advisor known for her unique approach to modern etiquette and leadership. As the author of The Unexpected Leader: Discovering the Leader Within You and Leader by Mistake: Becoming A Leader One Mistake At A Time, she frequently speaks and writes on the leadership-for-all concept.
Sam Kilmer, Managing Director at Cornerstone Advisors
Sam Kilmer leads Cornerstone Advisors’ fintech advisory practice working with industry providers, fintechs, and investors. He also leads select strategy engagements with banks and credit unions.
Jill Castilla, President & CEO at Citizens Bank of Edmond
As President & CEO of Citizens Bank of Edmond, a one-location $350 million community bank in suburban Oklahoma City, and Chairman of Citizens Bancshares, Inc., Jill Castilla is a nationally recognized innovator in banking and financial technology.
FIS-owned Worldpay is integrating Alipay+ to broaden the payment acceptance tools it offers merchants.
The rollout will begin with AlipayHK, a standalone e-wallet that is limited to Hong Kong dollars.
“By tapping into Worldpay’s market leading footprint, together we can help more merchants globally accelerate their growth journeys and expansion into strategic markets,” said General Manager of Ant Group in Europe and the Middle East Guoming Cheng.
Worldpay revealed its latest partnership today. The FIS-owned electronic payment and banking company announced it will integrate Alipay+ as an option among its e-commerce and POS offerings.
To initiate the rollout, Worldpay will start by enabling its merchant clients to support Alipay’s AlipayHK e-wallet. AlipayHK will be available to Worldpay’s clients in phases. Alipay launched AlipayHK as a standalone app in 2017. The AlipayHK wallet differs from Alipay because, as the name suggests, it is limited to transactions that are made and settled in local Hong Kong dollars.
“To stay competitive, merchants must understand and offer the payment methods that their customers prefer. Local wallet providers are extending their dominance in several APAC markets,” said Worldpay from FIS General Manager for Global E-commerce, APAC Phil Pomford. “We’re thrilled to be collaborating with Ant Group to provide our global merchants access to the Alipay+ platform starting with the AlipayHK wallet.”
Developed by Ant Group, the wider Alipay+ brand provides global cross-border mobile payment tools that help merchants enable Alipay’s one billion active consumers to pay with apps they’re already using, including MPay, Kakao Pay, GCash, and more. Alipay+ also offers merchants digital marketing tools to better target and serve customers.
“The collaborative effort with Worldpay will empower merchants to sell globally and contribute to our mission of providing more open, digitalized, and inclusive financial services to global audiences,” said General Manager of Ant Group in Europe and the Middle East Guoming Cheng. “Alipay+’s suite of innovation solutions is connected with more than one billion consumers worldwide. By tapping into Worldpay’s market leading footprint, together we can help more merchants globally accelerate their growth journeys and expansion into strategic markets.”
Originally acquired in 1971, Worldpay now processes $130 million daily for more than one million merchants across the 146 countries. FISacquired the company in 2019 for an estimated $34 billion. Earlier this year, FIS sold a majority stake in Worldpay to private equity firm GTCR.
Venture investing platform OurCrowd announced an integration with Airwallex.
The integration will make it easier for investors around the world to use their local currency to invest in startups.
Based in Israel, OurCrowd made its Finovate debut at FinovateSpring 2016.
Payments and financial platform Airwallex and venture investing platform OurCrowdannounced a new partnership this week. The two companies are combining their efforts to make it easier for both institutions and accredited investors to invest in startups wherever they are and in their local currency – all with a single click.
The integration works with OurCrowd allocating a global account for each investor. Investors can choose to convert their funds into a number of different currency options, including their own local currency. OurCrowd converts the funds to the selected currency at a transparent rate that is typically guaranteed for 24 hours. More than a third of OurCrowd’s FX flow has moved via Airwallex since the company embedded its API in February. OurCrowd anticipates increasing its flow to 90% by the end of the year.
“With the globalization of the startup world advanced fintech which is multi-currency is a game changer,” OurCrowd CEO Jon Medved said. “Now you can be sitting in Israel and invest in a Silicon Valley startup, pay in Shekels with a single click and it is totally transparent.”
Traditionally, investors have had to convert their local funds into U.S. dollars and then send those funds by wire in order to invest in startups. In contrast, the partnership between OurCrowd and Airwallex will provide investors from more than 195 countries with a platform that enables them to use their own currency to invest in startups. Integrating Airwallex’s API into its platform also gives accredited investors access to Airwallex solutions such as Global Accounts, Payouts, and LockFX which offer further opportunities for investors to participate in startup deals.
Pranav Sood, EGM, EMEA at Airwallex, described the partnership as another success for embedded finance. Sood explained that the integration was a “perfect example” of supporting the growth of its end users while simultaneously giving OurCrowd tools to add to the services they are able to offer. “From streamlining payment processes for investors and startups to minimizing FX costs, embedded finance is simplifying the way businesses operate across borders,” Sood explained.
Headquartered in Melbourne, Australia, Airwallex helps more than 100,000 businesses streamline their international payments and financial operations. The company offers solutions for payments, treasury and spend management, as well as embedded finance, and processes $50 billion in annualized transaction volume. In recent months, Airwallex has forged partnerships with Brex, payments network TrueLayer, business payments platform MODIFI, and Expedia. Founded in 2015, the company has raised more than $900 million in funding at a valuation of $5.6 billion.
OurCrowd made its Finovate debut at FinovateSpring 2016. At the conference, the Israel-based company showed how its app provided an interactive investment discovery and review process to help accredited investors make better, more informed decisions. One of the most active venture investors in Israel over the past ten years, according to Pitchbook, OurCrowd has more than $2.2 billion in commitments. The company has deployed capital into more than 420 portfolio companies and 50 funds across five continents. Founded in 2013, OurCrowd has more than 225,000 registered members from 195 countries on its platform today.
Melio is launching Pay Over Time, a buy now, pay later tool for small businesses.
Pay Over Time enables businesses to pay invoices in a single installment, or over the course of three, six, or 12 months.
The suppliers receive the payments on time and in full and do not need to sign up or register.
Small business payments and receivables company Meliounveiled its newest tool for small businesses (SMBs) this week. The New York-based company is launching Pay Over Time, a buy now, pay later (BNPL) solution for SMB clients.
Powered by Credit Key, Pay Over Time allows Melio’s small business customers to pay invoices in monthly installments, while their suppliers get paid in full and on time. Businesses can select to repay in a single installment (net 30) or over the course of three, six, or 12 months. Melio then debits the repayments each month from the business’ preferred bank account.
“We’re proud to be providing more flexibility to small businesses that need to pay bills and invoices with strict terms, enabling our customers to better align their spend and income,” said Melio Co-founder and CEO Matan Bar.
As a result of the more flexible payments structure, Melio’s business customers are able to free up to $50,000 in cash flow when they need it. The installments come with no impact to vendors and doesn’t require them to sign up or register.
Melio was founded in 2018 to provide accounts payable and receivable as a service through banks, software providers, and marketplaces. The company’s tools allow businesses to choose how they pay and get paid, and help them stay on top of paying their bills and invoices.
“Melio is continuing to scale rapidly and offer new products to meet the evolving needs of small business owners,” said Melio co-founder and CTO Ilan Atias. “This product will be a gamechanger for small businesses because of the ease of use – with Pay Over Time small businesses have a tool embedded into their pay flow to quickly access financing.”
Rumors have circulated that the partnership between one of the biggest names in finance – Goldman Sachs – and one of the biggest names in tech – Apple – is coming to an end.
Specifically, the reports suggest that Goldman Sachs is looking to exit its financial relationship with Apple. Goldman Sachs is Apple’s partner for its Apple Card – and has been since 2019. Goldman Sachs is also Apple’s partner for its Buy Now Pay Later service, currently in beta. Reports from the Wall Street Journal indicate that Goldman Sachs is looking to off-load its Apple credit card business to American Express.
So why has the relationship soured? Here are four possible factors:
Know Your Customer
One of the big headline issues hinting at friction between Goldman Sachs and Apple occurred when Apple CEO Tim Cook was testing the Apple Card and was unable to get approved. The issue had to do with fraud protection protocols on Goldman Sachs’ side. The company’s underwriters rejected the application because, as a well-known, high-profile individual, Tim Cook is often impersonated by fraudsters. This appeared to be a one-off problem at first. But an investigation by the U.S. Consumer Financial Protection Bureau led to additional concerns about disputed transactions and, ultimately, reports of gender bias in the granting of credit limit increases. Goldman Sachs was cleared of any wrongdoing, but the drama helped stoke tensions between the company and Apple.
Culture Clash
It’s not surprising that there were issues between the East Coast Wall Street culture of Goldman Sachs and the West Coast Silicon Valley culture of Apple. But there were very real challenges in the working relationship between the two firms. As is often the case when “move fast and break things” technologists team up with the rules-based world of finance, there was a tension between what one person called a focus on “the sleek technology and product pizazz” on the one hand and “regulatory compliance and profitability” on the other. Even at a more mundane level, basic issues such as the timing of billing statements and card design became grist for conflict and development delays.
The Bank Behind the Curtain
Writing at 9to5 Mac, Chance Miller noted that in addition to losing a ton of money with Apple Card – more than $1 billion by January 2022 – there are other ways that Goldman Sachs was losing out on the Apple partnership. Miller points out that not only was Apple developing its own in-house financial service project (called “Project Breakout”), but also there were other aspects of the relationship that ill-served Goldman Sachs. “One thing to keep in mind is that most Apple Card users likely don’t even know Apple Card is backed by Goldman Sachs,” Miller wrote. “Goldman Sachs exists in the backend, and everything else is managed directly through the Apple Wallet app.”
While this relationship is common in fintech and financial services, it seems like a poor approach for Goldman Sachs, which is newer to the consumer business than Chase or American Express and was likely seeking to build its consumer brand via its association with Apple. Couple that issue with the financial losses, and the potential of Apple “breaking out” on its own, and Goldman Sachs may have one more reason to start second-guessing its Apple Card gambit.
Whose Idea Was This Anyway?
When Goldman Sachs first announced its partnership with Apple, there were many who questioned the financial institution’s deepening foray into consumer banking. Goldman Sachs earned its lofty reputation in the world of finance as a leading investment bank and investment management firm. To say that consumer banking was not a core Goldman Sachs competency would be an understatement. But in the wake of the financial crisis, with Wall Street banks desperate for new revenue sources, consumer banking and the rise of fintech were alluring opportunities to an institution like Goldman Sachs. Goldman Sachs had room to grow – and money to burn. The firm also had a brand name and reputation that would help it gain the attention it would need in an increasingly competitive market.
But projects like Marcus rose and plateaued, with an initial rush of deposits leading to overly optimistic profit forecasts and, ultimately, significant losses. Efforts to expand into areas such as investing via Marcus revealed that Goldman Sachs was not as innovative as smaller upstarts like Robinhood. An attempt to leverage opportunities in consumer lending with the acquisition of Buy Now Pay Later startup GreenSky proved costly.
Seen through this lens, Goldman Sachs’s issues with Apple Card may have more to do with Goldman Sach’s issues with consumer banking.
Digital mortgage platform SimpleNexus has integrated with Finastra’s MortgagebotLOS.
The bi-directional integration is designed to streamline the home financing process for both home buyers as well as lenders, credit unions, and banks.
Finastra was formed in 2017 as the product of a merger between Misys and D+H.
Digital mortgage platform SimpleNexus has integrated with Finastra’s loan origination system for digital mortgage lending, MortgagebotLOS. The bi-directional integration will streamline home financing for both home buyers as well as the credit unions, banks, and lenders who cater to them. Homebuyers will be able to submit mortgage applications by smartphone or other Internet-connected device, and will benefit from being able to easily and securely scan and upload required documents. Automated mortgage loan milestone updates, courtesy of real-time data syncing between the two systems, notify homebuyers on their progress and point to next steps.
“The integration enables financial institutions to optimize their use of both platforms while providing borrowers with a seamless and supportive mortgage application process,” Finastra director of product management Mary Kay Theriault said. “Our goal is to equip lenders with the tools they need to stay ahead in any mortgage market.”
Ben Miller, SimpleNexus CEO, underscored the importance of the bi-directional integration of the two technologies. Miller noted that both homebuyers and lenders will benefit from improvements in convenience, efficiency, and overall usability with the new “from-anywhere digital mortgage application portal.”
Among the first banks to have deployed the technology are ChoiceOne Bank, based in Michigan, and Flanagan State Bank, based in Illinois. Both institutions have leveraged the integration to improve the navigability of the mortgage process for homebuyers as well as reduce manual and redundant tasks for loan originators and processing teams.
Founded as a merger between Misys and D+H in 2017, Finastra currently serves more than 8,100 financial institutions – including 45 of the world’s top 50 banks -across 130+ countries. The company offers solutions for lending and corporate banking, payments, treasury and capital markets, investment management, and banking-as-a-service.
Last month, Finastra announced a partnership with Open Finance company and fellow Finovate alum MX. The partnership will integrate MX’s PFM, insights, and account aggregation solutions with Finastra’s Fusion Digital Banking platform. Also in July, Finastra announced that it was working with European payments processing startup Salve Financial Hub and specialist mortgage lender and savings provider Melton Building Society.
Headquartered in London, Finastra maintains offices in Canada, Singapore, the UAE, and the U.S. Simon Paris is CEO.
This is a sponsored blog post by Matt Roche, CEO, Extole
Your job needs to be easier.
What you want is reasonable: acquire customers at a reasonable cost that will stick around and grow to use your broader offering. Instead, you are getting lower account retention and more difficulty opening new accounts, originating loans, or signing policies. And it gets harder every year, with higher paid media customer acquisition costs (CAC) and lower loyalty.
There is a solution, Customer-led Growth (CLG), the strategy of putting your customers and account holders at the center of your marketing, and it can deliver higher quality customers at a lower CAC.
CLG works.
Customer-led Growth is executed as a coordinated set of programs and activities that activate and engage prospects and customers along the entire customer journey to drive high-quality/low-cost acquisition, higher LTV, and higher engagement. CLG is predicated on the simple fact that your existing customer base is your most valuable and underused source of brand, awareness, and growth.
Customer-led Growth delivers the highest quality customers of any channel. Extole has worked with leading credit card, credit union, bank, brokerage, insurance, mortgage, and fintech companies. In nearly every case, the newly acquired customers from CLG programs are more profitable than any other channel.
For a brokerage, 24% more customers adopted higher-value trading products
For a credit card company, 22% more customers made their card first out of wallet
For a credit union, customers executed 15% to 20% more debit card transactions
In addition, existing customers that participated in programs were more likely to be among the most valuable to the firms we served. Simply engaging in programs, whether referral, nominations, gifting, cross-sell, or otherwise led to customers that were stickier and more profitable.
If a marketing approach can deliver higher-quality customers in this economic environment, why wouldn’t you do everything possible to adopt it?
The elements of Customer-led Growth
CLG is based on a simple mechanism: offer incentives to targeted audiences along the customer journey to drive high-value engagement. The key elements of a successful strategy include:
Evergreen referral and advocacy – Make referral an essential part of being a customer or account holder, providing codes, links, and tools for sharing that promote and reward natural advocacy.
Challenges – Looking to increase app downloads or get customers to set up direct deposit? Test different incentives to drive higher uptake.
Journey-based engagement – Introduce customers to programs at different stages, from onboarding to more mature, to keep them engaged and grow product usage.
Targeted offers – Target incentivized programs to audiences, like new customers, partners, agents, or specific segments to make certain that incentives are going only to those individuals that will take action.
Dynamic incentives – Allow rewarding using a huge range of incentives, including account credits, gift cards, charitable donations, privileges, and vouchers with rules crafted to make certain you are rewarding what creates value for you.
What to expect from Customer-led Growth
Most marketers will begin their Customer-led Growth journey with referral (or refer-a-friend) because it provides the fastest, most reliable return on investment and the highest quality new customers. Even firms with existing programs find that adopting purpose-built and modern technology results in significantly higher results because the experience is more seamless for customers, eliminating fraud and manual processing that prevent rapid satisfaction.
The next stage is optimization, tuning the incentive and experience and expanding the marketing of the program to ensure the widest possible participation. For an ordinary credit union, this could mean delivering 10% of new accounts with a basic program.
Driving new customer acquisition
In my experience, the best programs have delivered 30% to 40% of new accounts, a staggering result for a channel that delivers consistently high-quality accounts. In order to achieve this level, marketing teams must drive participation, usually through three techniques:
Expand marketing – The number of new accounts created is a function of customer awareness of the programs and ultimately of customers taking action. Driving higher program awareness drives end volume.
Segment participants – Behavioral patterns will emerge as customers engage. You will be able to distinguish simple advocates from ambassadors and superadvocates/ affiliates. Target programs to each audience to maximize yield.
Vary terms and incentives – Different participants will respond to different incentives, and rapidly refreshing program structures can drive higher participation and yield.
Driving customer base revenue
Once you have established acquisition programs that are effective, then you can expand to broader programs to drive customers to higher-value segments through targeted challenge programs.
For example, for almost all firms, a customer who downloads a mobile app will have a meaningfully higher lifetime value. Create a challenge program targeted to customers in their first 90 days offering an account credit for downloading and installing the app. Other important milestones include connecting accounts, executing trades, or adopting new products, all of which can be promoted at different stages using incentives that are only available to customers that are at that point in their journey.
You can also adopt “surprise and delight” style programs that offer incentives for having done something, as a thank you for a behavior that has created value. While these are more subtle, they can have a profound effect on tenure.
The long-term benefits of Customer-led Growth
A mature Customer-led Growth approach will provide a healthier, longer-term customer base that is connected with you in a more meaningful, less transactional way. As you evolve in this strategy, you will find yourselves spending less time talking about “last click” attribution, and more time talking about customer quality by channel, rates of participation, and how incentives relate to your brand. Higher quality questions reflect higher quality marketing organizations.
Extole created CLG, and is the leading platform. Connect with us September 11-13, 2023 at FinovateFall in booth 210.
Ramp is launching Ramp Plus, a new suite of procurement tools.
Ramp Plus will help finance teams with procurement-related tasks, including approval workflows, global expense capabilities, payment card controls, and more.
The new tools will be available starting in September.
Business finance automation platform Ramp is getting a lift today. The New York-based company has launched Ramp Plus, a new procurement solution to help businesses scale. “With Ramp Plus,” the company explained in an announcement, “we are helping growing companies with their most complex financial operations.”
Today’s launch positions Ramp as a more unified platform to help finance teams with procurement-related tasks. Some of the new capabilities include:
Procure-to-pay solution that helps businesses with spend requests, approval workflows, and purchase order tracking.
Global expenses and payments capabilities that enable global spending with support for multiple entities, multiple currencies, tax reporting, and debiting for select currencies.
A workflow builder that helps businesses automate complex processes with rules-based workflows.
Enhanced controls and policy enforcement that include payment card auto-locks, transaction review mandates, and flags for out-of-policy expenses.
Ramp Plus can be easily integrated within an organization’s existing tech stack.
Shopify is one of Ramp Plus’ early partners. The ecommerce company is leveraging Ramp’s new technology to help manage business expenses and issue payment cards for its 10,000+ employees.
Ramp Plus will be available starting in September, and Ramp is automatically upgrading all of its existing SMBs and mid-market business customers to Ramp Plus for one year for free. Other existing Ramp customers that sign up for Ramp Plus before September 19 can receive complimentary access to the new service for free for a year.
Ramp was founded in 2019 and serves 15,000 companies that range in size from startups to enterprises with its suite of payment cards, expense management tools, accounts payable offerings, working capital, and more. The company has raised $1.4 billion in funding, including its most recent $200 million Series C round. Eric Glyman is co-founder and CEO.
