Financial institutions are looking to upgrade their tech stacks to attract customers and drive deposit growth. 

The approach of strengthening deposits and adding to the client pool follows the spring collapses of Silicon Valley Bank, First Republic Bank and Signature Bank.

“Banks that had good and aggressive digital account opening experiences were able to gobble up a huge amount of market share,” Garrett Lair, director of decision sciences at banking software provider Amount, told Bank Automation News. 

For example, JPMorgan acquired First Republic Bank and Bank of America has continued to strengthen its portfolio through strong deposits and innovative use of technology.  

JPM reported a 5% year-over-year increase in tech spend to $2.3 billion, while Bank of America’s noninterest expenses increased 5% YoY to $16 billion in the second quarter. 

Strong portfolios 

Academy Bank, for one, teamed up with Treasury Prime last month to provide BaaS to its clients, ultimately allowing the bank to gain deposit growth, David Robinson, director of fintech partnerships at Academy Bank, previously told BAN.  

“We’re very much looking for deposit opportunities, and this will just open up doors for us that wouldn’t previously have been opened,” Robinson said. 

Similarly, First Internet Bank tapped digital banking solution provider Narmi in July to help business clients open accounts digitally, Craig Fortner, chief information officer at First Internet Bank, told BAN earlier. 

Upgrading the onboarding process helps the $4.5 billion bank provide a better user experience with less friction and higher conversion rates, he said. 

Since First IB is a digital-only bank, “it is critical for us to open accounts and drive deposits because we don’t have the branch network like a credit union,” Fortner said. 

Avoiding mergers through tech 

Banks are trying to find creative ways to gain and retain customers as more bank mergers are expected in the remaining months of the year, James White, general manager of banking at Total Expert, a software-as-a-service provider, told BAN. 

This year, there have been 65 bank mergers, according to Pacific Coast Bankers’ Bank. 

“Bank of America has been able to capture the most amount of millennial customers by having the coolest technology, having ATMs on every corner, improving their digital banking offerings and marketing,” White said. “Gaining more customers can help drive deposit growth and gives banks the opportunity to sell more products to its customers.”