Grasshopper Bank has reduced manual reviews in its onboarding process by 57% through fintech Alloy’s risk-management solution.  

The bank implemented Alloy’s Identity Risk Solution in March 2022. At the time, 20% of its applications were reviewed manually to monitor for fraud, Lauren McCollom, head of embedded finance at Grasshopper, told Bank Automation News. 

With Alloy’s automated workflow in place, “our team has the ability to not have to keep adding on new analysts … to review and investigate [applications],” she said.

Instead, the $733 million digital bank is tapping Alloy’s tools, technology and rule sets to stop fraud in onboarding, McCollom said, noting that onboarding is “the best place for it to stop … before it even gets into our system.” 

The bank reviews between 1,000 and 2,000 applications for digital business deposit accounts each month, and the automated workflow technology allows the bank to “keep bad actors out and keep in the good [and] allows us to more meaningfully scale our risk operations while growing our deposits,” she said. 

Fraud is more sophisticated than a mismatched ID, address or phone number, McCollom said. Fraudsters are taking over the identities of individuals and businesses, McCollom said. To stop that, Alloy’s platform allows Grasshopper to directly integrate with various data services that monitor the onboarding process. 

The technology “is critical to us being able to grow and bring the right customers in,” she said.